Stamp Duty On Sales Through Court Auctions

In a recent Order of the Hon'ble Bombay High Court, Justice G. S. Patel settled a very peculiar situation, when the stamp duty was initially calculated on the Ready Recknor value, instead of the value fetched in a Court Auction Sale.

As a rule of law, the stamp duty to be paid on an instrument is based on the market value of the property which is either the price at which such property would have been sold at in the open market or the consideration paid for it, whichever is higher. In this particular sale, the sale was conducted through a Court Auction Sale which fetched a price of around 15 Crores but when the sale certificate was sought to be registered, the stamp authorities valued the property at around 155 Crores and demanded stamp duty as per the said price of 155 crores.