ADARSH SAHKARI GRIH NIRMAN SWAWLAMBI SOCIETY LTD v. THE STATE OF JHARKHAND
Stamp Duty Exemption for Cooperative Societies: Additional Recommendation Requirement Deemed Illegal and Superfluous by Supreme Court.
Court: Supreme Court of India
Citation: 2025 INSC 1389
Decision Date: 05-12-2025
List of Laws
The Indian Stamp Act, 1899; The Indian Stamp (Bihar Amendment) Act, 1988; The Jharkhand Self-Supporting Cooperative Societies Act, 1996; Article 226 of the Constitution of India; Administrative Law
Case Brief
- Facts: A cooperative society, registered under the Jharkhand Self-Supporting Cooperative Societies Act, 1996, aimed to provide housing to its members. The Principal Secretary, Department of Registration, issued a memo mandating that stamp duty exemptions under Section 9A of the Indian Stamp (Bihar Amendment) Act, 1988, for cooperative societies would only be granted upon recommendation from the Assistant Registrar, Cooperative Society. The cooperative society challenged this memo, arguing it created an unnecessary hurdle.
- Procedural Posture: The cooperative society filed a writ petition in the High Court under Article 226 of the Constitution of India, challenging the memo. The High Court refused to exercise judicial review. The cooperative society then appealed to the Supreme Court.
- Issue: Was the memo issued by the Principal Secretary, Department of Registration, requiring recommendation from the Assistant Registrar, Cooperative Society, as a pre-condition for stamp duty exemption under Section 9A of the Indian Stamp (Bihar Amendment) Act, 1988, legal and valid?
- Holding: No, the memo is illegal and set aside. The Supreme Court allowed the appeal against the High Court's judgment.
- Reasoning: The Court reasoned that the certificate of registration of a cooperative society under Section 5(7) of the Jharkhand Self-Supporting Cooperative Societies Act, 1996, is conclusive proof of its existence. Requiring an additional recommendation from the Assistant Registrar is a superfluous and unnecessary requirement that disrupts the ease of transactions without adding value. The court held that the memo was based on irrelevant considerations, leading to illegality. The court emphasized that "executive actions that mandate certain unnecessary, excessive requirements, must equally be set aside as illegal." The court also noted that Section 9A of the Indian Stamp (Bihar Amendment) Act, 1988, intended to encourage the cooperative movement by exempting stamp duty on instruments relating to the transfer of premises by Cooperative Societies to their members.