#Registration Archives

7 Feb

A registered sale deed where the full consideration is paid would operate from the date of its execution: Supreme Court

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Case title: Kanwar Raj Singh vs Gejo

Case no.: Civil Appeal No. 9098 of 2023

Decided on: 02.01.2024

Quorum: Hon’ble Justice Abhay S. Oka, Hon’ble Justice Pankaj Mithal

FACTS OF THE CASE:

The current appeal stems from a decision of the Punjab and Haryana High Court. The appellant sued for a declaration. She sought a declaration of ownership over the land measuring 71 kanals 8 marlas (“suit property”), citing the executed and registered sale deed. According to the case of the original plaintiff, Smt. Gejo, the first defendant made an interpolation in the sale deed before it was registered, adding that only one-third of a share measuring 23 kanals and 8 marlas was sold. The first defendant contested the suit, claiming that what was sold was the area of 23 kanals and 8 marlas, which was his one-third share of the suit property.

The trial court ruled in favour of the suit. On appeal to the District Court, the Additional District Judge granted the appeal and determined that the correction in the sale deed was genuine and not fraudulent. The plaintiff sought a second appeal before the High Court. The appeal was allowed by the impugned judgement, and the Trial Court’s decree was restored.

ISSUE RAISED:

Can a compulsorily registerable document, once registered under the Registration Act, operate from a date prior to its registration?

LEGAL PROVISIONS INVOLVED:

According to Section 47 of The Registration Act of 1908, a registered document is effective from the time it would have begun to operate if no registration was required. Thus, when a compulsorily registerable document is registered in accordance with the Registration Act, it can begin to operate on a date prior to its registration. The date of the operation will vary depending on the nature of the transaction.

Section 54 of the Transfer of Property Act of 1984 defines a sale. A sale is a transfer of ownership in exchange for a price paid or promised, or a partial payment and partial promise.

Section 54 of the Transfer of Property Act requires that all sale deeds for property worth more than Rs. 100/- be registered. Thus, a vendor-executed sale deed becomes an instrument of sale only after it is registered.

APPELLANTS CONTENTIONS:

The learned counsel contended that the sale took effect on the date the sale deed was registered, not the date it was executed. He contended that the sale deed conveys the same information as the registered sale deed. He claimed that even the agreement for sale signed prior to the execution of the sale deed refers to the sale of a third of the first defendant’s share, not the entire property.

The counsel relied on a Constitution Bench decision in the case of Ram Saran Lall v. Domini Kuer and contended that, under the said decision, the sale was completed when the sale deed was registered, and thus the description of the property recorded in the registered sale deed will prevail.

COURT ANALYSIS AND JUDGMENT:

The court ruled that the consideration was paid in full on the date the sale deed was executed. The sale deed was registered with an interpolation concerning the description/area of the property sold. The first defendant admitted that the interpolation occurred after the execution but before the registration. According to Section 47 of the Registration Act, a registered sale deed in which the entire consideration is paid becomes effective on the date of execution. As a result, the original sale deed will be effective. Therefore, the court concluded that the high court’s decision was correct and dismissed the appeal.

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Written by – Surya Venkata Sujith

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1 Nov

Inspector General Of Registration To Be Responsible If More Than One Society Is Registered Under Same Name In TC Act: High Court Of Kerala

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Citation: WP(C) NO. 29707 OF 2023

Decided On; 20TH DAY OF OCTOBER 2023

Coram: Honourable Mr. Justice Devan Ramachandran

Introduction:

The allegation of the petitioners is that respondents have been allowed to be registered by the District Registrar, Kottayam and Thiruvananthapuram respectively, in the same name of the first among them, even though they obtained such registration much earlier. They allege that the attempt of respondents is to pass over as the first petitioner; and that, therefore, their registrations are now liable to be cancelled.

Facts:

It was submitted that, when societies apply to be registered under the provisions of the Travancore- Cochin Literary, Scientific and Charitable Societies Registration Act (for short ‘TC Act’), the District Registrars can only verify the bye-laws and the purposes of registration and then grant it, if there are no other legal impediments. It was further submitted that the District Registrars, obviously, were not aware that the first petitioner had already been registered; and therefore, that they cannot now do anything,

Petitioner is left with the remedy to approach Inspector General of Registration appropriately, who can then take necessary action under the statutory scheme, though he also will not be able to cancel registrations, which relief can be obtained only under the orders of competent Civil Courts.

Court’s Analysis and Judgement:

Court observed that rima facie, at first blush, this presents a real problem because, if there is no database accessible to the District Registrars, as to whether any other entity has been registered in the same name, then controversies as impelled herein, will keep arising in the future. It is directed to put a proper method to be put in place with respect to societies seeking registration under the “TC Act”; and it is the suggestion of this Court that the competent Authorities must consider collating all information in a proper Database, so that it can be accessed by the respective Registrars in future. This is only a commendation and not a command as court can’t command such action.

The petitioners is directed to move the Inspector General of Registration or the competent Civil Court seeking apposite reliefs against respondents.

Written by- Sushant Kumar Sharma

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19 Oct

Allahabad High Court Issues A Mandamus To Reinstate The Registration Certificate of Petitioner With Effect From 18.8.2022, Along with Consequential Benefits.

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Title: M/S Vidya Coal Depot v. Additional Commissioner Grade (Appeal) Ii And Another

Decided on: 5th October 2023

WRIT TAX No. – 394 of 2023:AHC:192420

Coram: HON’BLE PIYUSH AGRAWAL.

Introduction

The High court of Allahabad has entertained Writ Tax since G.S.T. Tribunal is not functional in the State of Uttar Pradesh pursuant to the Gazette notification of the Central Government. The petitioner has assailed the order passed by Assistant Commissioner Sector-14 Commercial Tax, Agra cancelling the GST registration of the petitioner under Section 29 (2) of U.P.G.S.T. Act. A mandamus has been sought for restoration of the registration of petitioner.

Facts of the case

Smt. Vidya Devi is the proprietor of the petitioner firm carrying the business of purchase and sale of coal on retail basis for which the GSTIN was granted. Since the petitioner’s turn over was below Rs. 50 lacs, it opted for compounding scheme under Section 9(1) of U.P.G.S.T Act as provided under Section 10 of the Act. On 24.09.2022, a show cause notice was issued by respondent no.2 to cancel the registration of the petitioner with the direction of the TTZ authority and written direction by JC (SIB) B Agra for cancellation of registration of all coal depot. The petitioner replied through registered post on 3.10.2022. Not being satisfied with the reply, the registration of petitioner was cancelled order dated 14.10.2022. Aggrieved by the order, petitioner preferred an appeal, but was rejected by order dated 1.12.2022. Hence the writ petition was filed.

Court Analysis and Decision

The petitioner has not violated Section 29 read with Rule 21 of UPGST Act and Rules framed therein. The registration of the petitioner has been cancelled at the behest of direction issued by JC (SIB) B, Agra as well as the direction of TTZ authority, but neither a copy of such direction has been provided at any stage to the petitioner nor the same was annexed along with the copy of notice issued to the petitioner. It was wrongly mentioned that no reply was submitted by the petitioner. The record reveals that along with the cancellation order, an appendix order was filed in the counter affidavit. It appears that to improve the case of the revenue such appendix has been annexed for the first time by the officer/respondent in the counter affidavit. The Apex Court in the case of Mohinder Singh Gill Vs. The Chief Election Commissioner, held that State authority cannot be permitted to supplement fresh reasons by means of affidavit and the the appendix along with the cancellation order cannot be any aid to the respondent authority.

It is a matter of common knowledge that under the GST Act, A/c book are to be maintained by every person. In absence of such, no violation of rule of UPGST Act, be made out against the petitioner. Once, there is no violation of Section 29 read with rule 21, any action taken for cancellation of registration cannot sustain in the eye of law. Thus, the judge has quashed the orders dated 14.10.2022 & 01.12.2022 and has issued a mandamus to the respondent-authorities No.1 to 3 to reinstate the registration certificate of petitioner immediately with effect from 18.8.2022 with all consequential benefits.

Written by- K R Bhuvanashri

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4 Aug

Government Must Ensure Implementation Of Delhi Online Registration System For Document Preservation : Delhi High Court

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Title: Monk Estates Private Limited & Anr. v. Government of NCT of Delhi & Ors.
Decided on: 27th July, 2023

+ W.P. (C) 254/2023

CORAM: HON’BLE MRS. JUSTICE PRATHIBA M. SINGH

Introduction:

The Delhi High Court recently addressed a matter concerning missing documents from the Sub-Registrar’s office in Delhi and directed the Delhi Government to ensure the implementation of the Delhi Online Registration System (DORIS) for document preservation. The Court expressed serious concerns about the missing records and emphasized the need for an effective system to preserve documents.

Facts

In January 2023, a petition was filed seeking an inquiry into missing records from the Sub-Registrar-III’s office in Delhi related to the execution and registration of lands owned by Monk Estates Pvt. Ltd. An FIR was registered in 2019 after a significant delay of 14 years. The Court raised serious concerns about the missing records and directed authorities to conduct a thorough investigation into the matter.

In February 2023, the concerned Sub-Registrar filed a status report stating that only a Lost Report had been registered in 2019, but no further investigation was conducted. The Court also sought detailed information about the DORIS system used for document registration and directed the Principal Secretary (Revenue) to ensure its effective implementation in all Sub-Registrar offices.

Analysis

The Court expressed doubts about the full implementation of the DORIS system despite its design. It noted that there was a need to ensure the availability of necessary systems and cloud service in all Sub-Registrar’s offices to prevent a situation like the present case, where important documents were missing, from recurring.

Held

The Delhi High Court directed the Delhi Government to continue the investigation into the missing records and register an FIR if necessary. It further instructed the GNCTD to ensure that the necessary systems and cloud service are made available to all Sub-Registrar’s offices for proper document preservation. The Court held that the Principal Secretary (Revenue), GNCTD, shall be personally responsible for ensuring the effective implementation of the DORIS system. With these directions, the Court disposed of the petition.

Written by- Ankit Kaushik

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25 Jul

Delhi High Court set aside the show cause notice, order in original and order in appeal against the petitioner under section 107 of the GST act

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Title: Kartik Agarwal vs UOI

Date of Decision: 18.07.2023

+ W.P.(C) 9424/2023 and CM Nos. 36000/2023 & 36001/2023

CORAM: HON’BLE MR. JUSTICE VIBHU BAKHRU

HON’BLE MR. JUSTICE AMIT MAHAJAN

Introduction

Delhi High Court set aside the show cause notice, order in original and order in appeal against the petitioner and also held that the GST’s cancellation The process of registering a taxpayer has far-reaching effects on the taxpayer and often causes their business to halt. Legislators could never have intended to exclude anyone from operating a lawful company. As a result, the step of cancelling the GST should only be used sparingly and when absolutely required.

Facts of the case

In essence, the petitioner is offended by the revocation of her GST Registration. The petitioner has also asked for a return of Rs. 20,00,000 (Rupees twenty lacs only), which she alleges was placed under duress from the respondent authorities rather than willingly in response to any demand. However, the petitioner does not want to seek any remedy in relation to the deposit, totaling 20,00,000 as requested in the petition at this time, according to the experienced counsel for the petitioner. However, the petitioner wants to retain her rights so that, if required, she might subsequently avail herself of the proper remedies in this respect.

Given the foregoing, the current petition is limited to the petitioner’s challenge of the Order-in-Original dated 28.10.2022, which cancelled the petitioner’s GST registration, and the Order-in-Appeal dated 30.05.2023, which rejected the petitioner’s appeal against the Order-in-Original dated 28.10.2022.

The petitioner claims to be involved in the import and distribution of different minerals, lubricant preparations, and chemicals that come under Chapters 27 and 34 of the Customs Tariff Act, 1975. She asserts that she began operating the aforementioned business under the name and style of a sole proprietorship concern called “Vivaan International” before the GST Regime went into effect on July 1st, 2017, and that she was registered as a dealer under the Delhi Value Added Tax Act.

The petitioner claims that on September 7,2022, her premises were visited and examined by the Anti Evasion Staff of the Central Tax CGST, Delhi North Commissionerate. She says they also removed a few documents from her property without first drafting a panchnama. and they were pressured to deposit 20 lakh rupees, they gave in to their demands and, after speaking with the petitioner, deposited a sum of Rs. 10,00,000/- (Rupees ten lacs only) through DRC-03 dated 7.9.2022.

On October 10,2022, the petitioner replied to the aforementioned Show Cause Notice of 06.10.2022. The petitioner claimed in her response that her accountant had been to the office as needed and had asked for more time to complete the documentation. The petitioner also asked for the cancellation of her GST Registration, which had been suspended.

The competent officer issued the Order-in-Original dated 28.10.2022, which is also challenged in the current case, terminating the petitioner’s GST Registration with effect from 03.07.2017 since the petitioner’s argument was rejected.

Under Section 107 of the Central Goods and Services Tax Act of 2017 (hereafter referred to as “the CGST Act”), the petitioner filed an appeal against the aforementioned ruling. By an Order-in-Appeal of 30 May 2023, the aforementioned appeal was, however, denied. The petitioner was prompted by this to submit the current petition.

Analysis of the court

It is significant to note that the petitioner’s appeal against the first Orderin-first dated October 28, 2022 was denied on the basis of time limitations alone. According to Section 107(1) of the CGST Act, an appeal against an Adjudicating Authority order must be lodged within three months of the date the order was communicated. Therefore, the petitioner in this instance had until January 28, 2023, to submit an appeal. But on February 13, 2023, the petitioner submitted the same. This delay was caused due to involvement in the procedure of filing documents at anti evasion department for verification.

Undoubtedly, the Appellate Authority had the option to excuse the appeal’s filing delay as long as it did not exceed one month in accordance with Section 107(4) of the CGST Act. In the current instance, it is clear that the petitioner was in communication with the Department to resolve the issue with the cancellation of the GST Registration, and in our opinion, the petitioner provided an acceptable justification for the fourteen-day delay.

We believe that the Appellate Authority should have excused the delay given the extensive consequences of cancelling the GST Registration.

As previously mentioned, the ruling of October 28, 2022, terminating the GST registration, was only made in response to directives given by another body. The DC(AE), CGST, North Delhi had, by letter dated 30.09.2022, directed cancellation of the taxpayer’s registration as of the date of her GST Registration. This is the only basis for cancellation of the GST Registration as mentioned in the Order-in-Original.

It is significant to remember that the Order-in-Original dated October 28, 2022 also included a tabular statement indicating that no tax was determined to be owing. Generally speaking, a decision-making authority must independently use its authority and cannot do so only on the instructions of another authority unless it has independently verified the validity of the decision. In this instance, it is clear that the challenged Order-in-Original dated 28.10.2022, which was issued exclusively on the advice of a different authority without taking the petitioner’s response to the Show Cause Notice dated 6.10.2022, into consideration. It is obvious that the challenged Order-in-Original dated October 28, 2022, cannot be upheld.

The Show Cause Notice dated 6.10.2022 sought to revoke the petitioner’s GST Registration for the sole reason that the petitioner had not answered to the summons issued under Section 70 of the CGST Act, which is also relevant information to note. The petitioner had outlined how her accountant had come to the office and requested a postponement so that they could complete the paperwork. There is no indication in the Order-in-Original dated 28.10.2022, that the aforementioned argument was taken into consideration.

the GST’s cancellation The process of registering a taxpayer has far-reaching effects on the taxpayer and often causes their business to halt. Legislators could never have intended to exclude anyone from operating a lawful company. As a result, the step of cancelling the GST should only be used sparingly and when absolutely required.

We annul the contested Show Cause Notice dated 06.10.2022, the Order in Original dated 28.10.2022, and the Order in Appeal dated 30.05.2023, in light of the foregoing. Further clarification is provided, stating that the respondent authority would be free to submit a formal Show Cause Notice outlining the grounds for any planned adverse action against the petitioner. It goes without saying that any orders issued in response to the aforementioned Show Cause Notice would be supported by justifications.

The petition is dismissed on the aforementioned conditions.

Written By – Shreyanshu Gupta

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