KERALA LAND REFORMS & DEVELOPMENT COOPERATIVE SOCIETY LIMITED versus THE DISTRICT REGISTRAR (GENERAL) & ANOTHER on 14 October 2022

KERALA LAND REFORMS & DEVELOPMENT CO-OPERATIVE SOCIETY LIMITED

v.

THE DISTRICT REGISTRAR (GENERAL) & ANOTHER

(Civil Appeal No. 6588 of 2015)

OCTOBER 14, 2022

[M. R. SHAH AND KRISHNA MURARI JJ.]

Kerala Co-operative Societies Act, 1969 – ss. 40 and 110 –Stamp duty – Remission of – In exercise of powers conferred underthe Travancore Act, 1951 and Madras Act, 1932, the Governmentof Kerala by SRO No. 75/1960 dated 08.10.1960, directed that inrespect of a co-operative society registered in the State, the wholestamp duty with which under the Kerala Stamp Act, 1959 instrumentsexecuted by or on behalf of any registered co-operative society orinstruments executed by officer of such society or member in hisown capacity or/and in the capacity of a Guardian of minor andrelating to the business thereof and decisions, award or orders ofthe Registrar or the Arbitrators under the said Cooperative SocietiesAct, there shall be remission of stamp duty – By Kerala Co-operativeSocieties Act, 1969, which came into force on 15.05.1969, theTravancore Act, 1951 and the Madras Act, 1932 came to be repealed– s.40 of the Kerala Act, 1969 provided for remission of stamp duty– Appellants were denied the benefit of remission of stamp dutyconsidering s.40 of the Kerala Act, 1969 – Case of appellants thatdespite repeal of the Travancore Act, 1951 and the Madras Act,1932, SRO 75/60 which was issued under the aforesaid Acts wassaved – Held: The notification issued under the repealed Acts shallbe saved to the extent “so far as may be” – On true interpretationof s.110(2) of the Kerala Co-operative Societies Act, the provisionsof the repealed Acts and/or the notifications and/or orders issuedunder the repealed Acts is/are saved and/or deemed to have beenissued under the Kerala Co-operative Societies Act, 1969 to theextent the same is not at variance or inconsistent with the provisionsof the Kerala Co-operative Societies Act – The instruments executedby a member in his own capacity or/and in the capacity of aGuardian of a minor, which was there in clause 1(a) of SRO 75/60

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Ais missing insofar as s.40 of the Kerala Co-operative Societies Act,is concerned – As clause 1(a) of SRO 75/60 is inconsistent withrelevant provisions of the Kerala Co-operative Societies Act, moreparticularly s.40 thereof, the said order is not saved and cannot besaid to be deemed to have been issued under the Kerala Co-operative Societies Act, (s.110(2) of the Kerala Co-operativeBSocieties Act) – Therefore, considering the express provisioncontained in s.40(1) (a) of the Kerala Co-operative Societies Act, amember of the society executing the document in his own capacityor in the capacity of a Guardian or a minor shall not be entitled tothe benefit of remission of stamp duty – Appellants not entitled toCbenefit of remission of stamp duty on instruments/sale deeds inquestion which could not be said to be executed by or on behalf ofa society or by an officer or member thereof relating to the businessof the society.

Dismissing the appeals, the CourtD

HELD:1. As rightly interpreted and held by the Full Benchof the High Court, the notification issued under the repealed Actsshall be saved to the extent “so far as may be”. Therefore, ontrue interpretation of Section 110(2) of the Kerala Co-operativeSocieties Act, 1969, the provisions of the repealed Acts and/orEthe notifications and/or orders issued under the repealed Actsis/are saved and/or deemed to have been issued under the KeralaCo-operative Societies Act, 1969 to the extent the same is not atvariance or inconsistent with the provisions of the Kerala Co-operative Societies Act, 1969. [Para 7][552-C-E]F

2. The instruments executed by a member in his owncapacity or/and in the capacity of a Guardian of a minor, whichwas there in clause 1(a) of SRO 75/60 is missing insofar as Section40 of the Kerala Co-operative Societies Act, 1969 is concerned.Section 40 of the Kerala Co-operative Societies Act, 1969 furtherGprovides that only in cases where, but for such remission thesociety, officer or member, as the case may be, would be liable topay such stamp duty. As per Section 40 (1)(a), the stamp dutychargeable under the Kerala Stamp Act, 1959 in respect of anyinstrument executed by or on behalf of a society or by an officer H

or member thereof and relating to the business of such society…..and in cases where, but for such remission the society, officer ormember, as the case may be, would be liable to pay such stampduty, there shall be remission of stamp duty. Thus, as clause 1(a)of SRO 75/60 is inconsistent with the relevant provisions of theKerala Act, 1969, more particularly Section 40 thereof, the saidorder is not saved and cannot be said to be deemed to have beenissued under the Kerala Act, 1969 (Section 110(2) of the KeralaAct, 1969). Therefore, considering the express provisioncontained in Section 40(1) (a) of the Kerala Act, 1969, a memberof the society executing the document in his own capacity or inthe capacity of a Guardian or a minor shall not be entitled to thebenefit of remission of stamp duty. [Para 8][552-H; 553-A-D]

3. The appellants shall not be entitled to benefit of remissionof stamp duty on the instruments/sale deeds in question whichcould not be said to be executed by or on behalf of a society or byan officer or member thereof relating to the business of the society.[Para 9][553-E]

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 6588of 2015.

From the Judgment and Order dated 17.03.2015 of the High Courtof Kerala at Ernakulam in W.A. No. 631 of 2015.

With

Civil Appeal Nos. 6830, 6831-6832, 6833, 6834-6836, 6837-6838of 2022.

Gopal Sankaranarayanan, Jayanth Muth Raj, Sr. Advs., M.P.Srivignesh, Lakshman Raja T., Mithun Kumaar N., Ms. Jhanvi Dubey,A. Selvin Raja, Haris Beeran, Mushtaq Salim, Usman Ghani Khan, AzharAssees, Radha Shyam Jena, A. Raghunath, K. Rajeev, Ms. NivedithaR. Menon, Aditya Verma, R. Nedumaran, Chandan Kumar Mandal,Romy Chacko, Sudesh Kumar Singh, C. K. Sasi, Abdulla Naseeh V.T.,Ms. Meena K. Poulose, Ranjith K. C., A. D. Sikri, Advs. for the appearingparties.

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[2022] 13 S.C.R.

AThe Judgment of the Court was delivered by

M. R. SHAH, J.

1. As common questions of law and facts arise in this group ofappeals, all these appeals are decided and disposed of together by thisBcommon judgment and order.

2. Feeling aggrieved and dissatisfied with the impugnedjudgment(s) and order(s) passed by the Full Bench of the High Court ofKerala at Ernakulam, by which the Full Bench of the High Court hasheld that,

Ci) the benefit of remission of stamp duty is available only in respectof instruments executed by or on behalf of a society or by anofficer or member thereof and instrument so executed should berelating to the business of the society; and ii) the benefit of remission can be claimed by the society only if,Dbut for such remission, the society, an officer, or the member, asthe case may be, would have been liable to pay such stamp duty,the Kerala Land Reforms & Development Cooperative SocietyLimited, Federal House Construction Cooperative Society Limited& Another, N.B.Krishna Kurup and Others, Aluva TownCooperative Housing Society and the Central Excise & CustomEOfficers Housing Co-operative Society Limited have preferredthe present appeals.

3. The particulars of each appeal(s) are as under:

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4. The facts leading to the present appeals in a nutshell are asunder:

Section 35 of the Travancore-cochin Co-operative Societies Act,1951 (hereinafter referred to as the ‘Travancore Act, 1951’) providedthat the Government, by notification in the gazette, may in the case ofany society or class of societies, remit the stamp duty with which, underany law for the time being in force, instruments executed in favour of orby or on behalf of a society or by an officer or member and relating tothe business of such society or any class of such instruments or awardsof the Registrar or Arbitrators under the Act are respectively chargeable.

A similar provision was made under the Madras Co-operativeSocieties Act, 1932 (hereinafter referred to as the ‘Madras Act, 1932’)as per section 30(2) of the said Act.

4.1 In exercise of the powers conferred under the TravancoreAct, 1951 and Madras Act, 1932, the Government of Kerala by SRONo. 75/1960 dated 08.10.1960, directed that in respect of a co-operativesociety registered in the State, the whole stamp duty with which underthe Kerala Stamp Act, 1959 instruments executed by or on behalf of anyregistered co-operative society or instruments executed by officer ofsuch society or member in his own capacity or/and in the capacity of a A

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AGuardian of minor and relating to the business thereof and decisions,award or orders of the Registrar or the Arbitrators under the said Co-operative Societies Act, there shall be remission of stamp duty. Clause1(a) of SRP No. 75/60, which is relevant for determination of the issuein question, reads as under:

B“1. The stamp duty, registration fees and fees for EncumbranceCertificate payable under the Stamp Act and the Registration Actin force in the State shall be remitted to the Co-operative Societies,in the following cases to the extent indicated in each case.

(a) The whole stamp duty with which under the Kerala StampCAct, 1959 (Act 17 of 1959) instruments executed by or onbehalf of any registered Co-operative Society or instrumentsexecuted by “any officer of such Society or member in hisown capacity or/and in the capacity of a guardian of minor”and relating to the business thereof and decisions, awards ororders of the Registrar or the arbitrators under the said Co-Doperative Societies Act.”

4.2 By the Kerala Co-operative Societies Act, 1969 (hereinafterreferred to as the ‘Kerala Act, 1969’), which came into force on15.05.1969, the Travancore Act, 1951 and the Madras Act, 1932 cameto be repealed. Section 110 of the Kerala Act, 1969 deals with RepealEand Savings, which reads as under:

“110. Repeal and Savings – The Madras Co-operative SocietiesAct, 1932 (VI of 1932), as in force in the Malabar District referredto in sub-section (2) of S.5 of the State Reorganization Act, 1956(Central Act 37 of 1956) and the Travancore-Cochin Co-operativeFSocieties Act, 1951 (X of 1952) are repealed.

(2) Notwithstanding the repeal of the Madras Co-operativeSocieties Act, 1932 and the Travancore-Cochin Co-operativeSocieties Act, 1951 and without prejudice to the provisions of Ss.4and 23 of the Interpretation and General Clauses Act, 1125 (VIIGof 1125).

(i) all appointments, rules and orders made, notifications and noticesissued, and suits and other proceedings instituted, under any ofthe Acts hereby repealed shall, so far as may be, be deemed tohave been respectively made, issued and instituted under this Act; H

(ii) any society existing in the state on the date of commencementof this Act which has been registered or deemed to be registeredunder any of the aforesaid repealed Acts shall be deemed to beregistered under the Act, and the bye-laws of such society shall,so far as they are not inconsistent with the provisions of this Act,continue in force until altered or rescinded.”

4.3 Section 40 of the Kerala Act, 1969 provides for remission ofstamp duty, which reads as under:

“40. Exemption from certain taxes, fees and duties –

(1) The Government may, be notification in the Gazette, remit inrespect of any class of societies- (a) the stamp duty chargeable under the Kerala Stamp Act, 1959(17 of 1959), in respect of any instrument executed by or on behalfof a society or by an officer or member thereof and relating to thebusiness of such society, or any class of such instruments, or inrespect of any award or order made under the Act, in cases where,but for such remission the society, officer or member, as the casemay be, would be liable to pay such stamp duty.”

4.4 The respective appellants herein were denied the benefit ofremission of stamp duty considering Section 40 of the Kerala Act, 1969,more particularly the last part of the Section which provides that remissionis available only in cases where, but for such remission, the society,officer or member, as the case may be, would be liable to pay suchstamp duty. It was the case on behalf of the appellants that with respectto sale deeds in question, the appellants shall be entitled to remission ofstamp duty. As per clause 1(a) of SRO 75/60 and as per Section 110(2)of the Kerala Act, 1969, notwithstanding the repeal of the TravancoreAct, 1951 and the Madras Act, 1932, all notifications under the repealedActs shall be deemed to have been respectively made, issued and institutedunder the Kerala Act, 1969. The matter reached up to the Full Bench ofthe High Court. On interpretation of the relevant provisions of the KeralaAct, 1969 and on interpretation of Section 110(2) of the Kerala Act,1969 (repealed provision), the Full Bench of the High Court has answeredthe reference as under:

“(1) SRO No. 75/60 issued under section 35 of the TC Act andsection 30 of the Madras Act is saved by virtue of section 110(2)

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Aof the Kerala Act only to the extent it is not inconsistent with theprovisions of the Kerala Act.

(2) SRO No. 75/60 should be understood within the limitations ofsections 110(2) and 40(1)(a) of the Kerala Act.

(3) The benefit of remission of stamp duty is available only inBrespect of instruments executed by or on behalf of a society or byan officer or member thereof and instrument so executed shouldbe relating to the business of the society.

(4) The benefit of remission can be claimed by the society only if,but for such remission, the society, an officer or the member asCthe case may be, would have been liable to pay such stamp duty.”

Hence, the present appeals.

5. Shri Gopal Sankaranarayanan, learned Senior Advocate andS/Shri Haris Beeran, K. Rajeev and R. Nedumaran, learned counselDhave appeared on behalf of the respective appellants and Shri JayanthMuthraj, learned Senior Advocate has appeared on behalf of therespondents.

5.1 Learned counsel appearing on behalf of the appellants havevehemently submitted that the Full Bench of the High Court has erred inholding that on the sale deeds in question executed by the members ofEthe society in favour of the society and the respective sale deeds executedby the society in favour of its members respectively, there shall not beany remission of stamp duty.

5.2 Learned counsel appearing on behalf of the appellants havevehemently submitted that in view of Section 110(2) of the Kerala Act,F1969, the notifications issued under the Travancore Act, 1951 and theMadras Act, 1932 are saved and they are deemed to have been issuedunder the Kerala Act, 1969. It is submitted that therefore SRP No. 75/60 which was issued in exercise of powers conferred under theTravancore Act, 1951 and the Madras Act, 1932, which provides forGremission of stamp duty on the instruments executed by the co-operativesociety or executed by a member in favour of the society, shall beapplicable and therefore on the instruments/sale deeds in question, thereshall be remission of stamp duty.

5.3 It is also submitted on behalf of the appellants that in theHinstruments/sale deeds in question, it is specifically provided that the liability to pay the stamp duty would be upon the society and thereforealso and considering the relevant provisions of the Kerala Act, 1969,there shall be remission of stamp duty.

5.4 It is further submitted that denying the remission of stampduty paid on the instruments/sale deeds in question would defeat theobject and purpose of providing the exemption from payment of stampduty with respect to society.

5.5 Making the above submissions, it is prayed to hold that on theinstruments/sale deeds in question executed either by the members ofthe society in favour of the society (Civil Appeal Nos. 6588/2015 &6830/2022) and the sale deeds executed by the society in favour of itsrespective members (rest of the civil appeals), there shall be remissionof stamp duty as per clause 1(a) of SRO No. 75/60.

6. While opposing the present appeals, Shri Jayanth Muthraj,learned Senior Advocate has vehemently submitted that on trueinterpretation of Section 110(2) of the Kerala Act, 1969 and having foundthat the Travancore Act, 1951 and the Madras Act, 1932 and SRO 75/60 issued in exercise of powers under the aforesaid Acts are not savedas they are inconsistent with the provisions of the Kerala Act, 1969(Section 40 of the Kerala Act, 1969).

6.1 It is submitted that as per SRO 75/60, the instruments executedby or on behalf of any registered co-operative society; instrumentsexecuted by officer of such society and instruments executed by amember in his own capacity or/and in the capacity of a Guardian ofminor and relating to the business thereof, there shall be remission ofstamp duty. It is submitted that however so far as the Kerala Act, 1969is concerned, as per Section 40 thereof, on the instruments executed byor on behalf of a society or by an officer or member thereof and relatingto the business of such society and only in cases where, but for suchremission, the society, officer or member, as the case may be, would beliable to pay such stamp duty, there shall be remission of stamp duty. It issubmitted that as per Section 40 of the Kerala Act, 1969, there shall notbe any remission of stamp duty in case any instrument is executed by amember in his own capacity or/and in the capacity of a Guardian of aminor, which was there in SRO 75/60. It is submitted that as per Section30 of the Kerala Stamp Act, the payment of stamp duty is exempted inrespect of documents/sale deeds/instruments executed by or on behalf A

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Aof a co-operative society. It is submitted that therefore when the societyis not liable to pay the stamp duty, there is no question of any remissionof stamp duty. It is submitted that therefore the respective appellantsshall not be entitled to remission of stamp duty on the instruments/saledeeds in question.

B7. We have heard learned counsel for the respective parties atlength.

The appellants herein are claiming remission of stamp duty on therespective instruments/sale deeds, the particulars of which are reproducedhereinabove. In two cases, the sale deeds are executed by the membersCin favour of the society and in rest of the cases, the sale deeds areexecuted by the society in favour of respective members. The respectiveappellants are claiming the benefit of remission of stamp duty underclause 1(a) of SRO 75/60. It is the case on behalf of the appellants thatdespite the repeal of the Travancore Act, 1951 and the Madras Act,1932, SRO 75/60 which was issued under the aforesaid Acts is saved.DHowever, as rightly interpreted and held by the Full Bench of the HighCourt, the notification issued under the repealed Acts shall be saved tothe extent “so far as may be”. Therefore, on true interpretation of Section110(2) of the Kerala Act, 1969, the provisions of the repealed Acts and/or the notifications and/or orders issued under the repealed Acts is/areEsaved and/or deemed to have been issued under the Kerala Act, 1969 tothe extent the same is not at variance or inconsistent with the provisionsof the Kerala Act, 1969. The following chart would demonstrate to whatextent clause 1(a) of SRO 75/60 is inconsistent with Section 40 of theKerala Act, 1969:

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8. From the aforesaid, it is apparent that the instruments executedby a member in his own capacity or/and in the capacity of a Guardian ofH

a minor, which was there in clause 1(a) of SRO 75/60 is missing insofaras Section 40 of the Kerala Act, 1969 is concerned. Section 40 of theKerala Act, 1969 further provides that only in cases where, but for suchremission the society, officer or member, as the case may be, would beliable to pay such stamp duty. As per Section 40 (1)(a), the stamp dutychargeable under the Kerala Act, 1959 in respect of any instrumentexecuted by or on behalf of a society or by an officer or member thereofand relating to the business of such society….. and in cases where, butfor such remission the society, officer or member, as the case may be,would be liable to pay such stamp duty, there shall be remission of stampduty. Thus, as clause 1(a) of SRO 75/60 is inconsistent with the relevantprovisions of the Kerala Act, 1969, more particularly Section 40 thereof,the said order is not saved and cannot be said to be deemed to havebeen issued under the Kerala Act, 1969 (Section 110(2) of the KeralaAct, 1969) as has been contended on behalf of the appellants. Therefore,considering the express provision contained in Section 40(1)(a) of theKerala Act, 1969, a member of the society executing the document inhis own capacity or in the capacity of a Guardian or a minor shall not beentitled to the benefit of remission of stamp duty.

9. In view of the above and for the reasons stated above, theappellants herein shall not be entitled to the benefit of remission of stampduty on the instruments/sale deeds in question. Such instruments/saledeeds in question cannot be said to be executed by or on behalf of asociety or by an officer or member thereof relating to the business of thesociety. We are in complete agreement with the view taken by the FullBench of the High Court.

10. Under the circumstances, all these appeals fail and the samedeserve to be dismissed and are accordingly dismissed. However, thereshall be no order as to costs.

Bibhuti Bhushan Bose(Assisted by : Preetam Bharti, LCRA)

Appeals dismissed.

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