In Pinak Bharat & Co. vs Anil Ramrao Naik, the High Court at Bombay has dealt with the issue of valuation of immovable property and its stamp duty in execution of a decree or an award.
The court said that in such situations, the following questions have come up:-
1) When submitted for adjudication under the Maharashtra Stamp Act, how should the authority, the Collector of Stamps, assess the ‘market value’ of the property?
2) Is he required to accept the value of the accepted bid, as stated in the court-issued sale certificate? 3) Is he required to spend time and resources on an independent enquiry?
4) Or is some of the available material on the record of this Court, and which underlies the auction sale, sufficient for his purposes?
5) Is there a meaningful distinction to be drawn between sales by the government and government bodies at a predetermined price, which has to be accepted by the adjudicating authority as the market value, and a sale by or through a court?
The Court decided that is such situation as a general practice:
(a) Where there is a sale by private treaty, the usual course stipulated in the Maharashtra Stamp Act will apply;
(b) Where the sale is by the Court, i.e. through the office of the Sheriff, or by the Court Receiver in execution, and is by public auction pursuant to a valuation having been previously obtained, then—
(i) If the sale price is at or below the valuation obtained, then the valuation will serve as the current market value;
(ii) If the final sale price, i.e. the final bid, is higher than the valuation, then the final bid amount and the not the valuation will be taken as the current market value for the purposes of stamp;
(iii) Where there are multiple valuations obtained, then the highest of the valuations most recent, i.e. most proximate in time to the actual sale, should be taken as the current market value.
The court said that in such situations, the following questions have come up:-
1) When submitted for adjudication under the Maharashtra Stamp Act, how should the authority, the Collector of Stamps, assess the ‘market value’ of the property?
2) Is he required to accept the value of the accepted bid, as stated in the court-issued sale certificate? 3) Is he required to spend time and resources on an independent enquiry?
4) Or is some of the available material on the record of this Court, and which underlies the auction sale, sufficient for his purposes?
5) Is there a meaningful distinction to be drawn between sales by the government and government bodies at a predetermined price, which has to be accepted by the adjudicating authority as the market value, and a sale by or through a court?
The Court decided that is such situation as a general practice:
(a) Where there is a sale by private treaty, the usual course stipulated in the Maharashtra Stamp Act will apply;
(b) Where the sale is by the Court, i.e. through the office of the Sheriff, or by the Court Receiver in execution, and is by public auction pursuant to a valuation having been previously obtained, then—
(i) If the sale price is at or below the valuation obtained, then the valuation will serve as the current market value;
(ii) If the final sale price, i.e. the final bid, is higher than the valuation, then the final bid amount and the not the valuation will be taken as the current market value for the purposes of stamp;
(iii) Where there are multiple valuations obtained, then the highest of the valuations most recent, i.e. most proximate in time to the actual sale, should be taken as the current market value.
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