The treatment provided to certificate of sale issued by an Official
Liquidator under the Insolvency and Bankruptcy Code, 2016 read with the
relevant Rules is different with respect to different Courts. There are
conflicting judgements of various High Courts on whether a certificate of sale requires to
be registered under the Registration Act and whether stamp duty is payable on
The Registration Act, 1908 states -
S. 17 (xii) - any certificate of sale granted to the purchaser of any property
sold by public auction by a Civil or Revenue-Officer does not need to be
S. 89 (4) - Every Revenue Officer granting a certificate of sale to the
purchaser of immovable property sold by public auction shall send a copy of
the certificate to the registering officer within the local limits of whose
jurisdiction the whole or any part of the immovable property comprised in
the certificate is situate, and such officer shall file the copy in his Book
This article aims to determine whether Official Liquidator appointed
under the Insolvency and Bankruptcy Code, 2016 can be considered a civil or
revenue officer within the scope of the above sections of the Registration
Insolvency and Bankruptcy Code and Regulations thereunder:
Regulation 33, Insolvency and Bankruptcy Board of India (Liquidation
Process) Regulations, 2016 states that The liquidator shall ordinarily sell
the assets of the corporate debtor through an auction in the manner
specified in Schedule I. Schedule I details the procedure that the
liquidator shall adopt in auctioning the property.
Section 5 (18) of the Insolvency and Bankruptcy Code defines
"liquidator" to mean an insolvency professional appointed as a liquidator in
accordance with the provisions of the Code.
Section 3 of the Insolvency and Bankruptcy Code provides:
(19) insolvency professional means a person enrolled under
section 206 with an insolvency professional agency as its member and
registered with the Board as an insolvency professional under section 207;
(20) insolvency professional agency means any person registered
with the Board under section 201 as an insolvency professional agency;
Indian Registration Act
Section 17 (1) (c) of the Registration Act, 1908 provides any documents
which is a non-testamentary instrument which acknowledges the receipt or
payment of any consideration on account of the creation, declaration,
assignment, limitation or extinction of any such right, title or interest
then, the registration for such document is compulsory.
Sub/clause (xii) further provides that nothing in the above shall apply
to any certificate of sale granted to the purchaser of any property sold by
public auction by a Civil or Revenue-Officer.
Section 89 (4) provides that every Revenue Officer granting a
certificate of sale to the purchaser of immovable property sold by public
auction shall send a copy of the certificate to the registering officer
within the local limits of whose jurisdiction the whole or any part of the
immovable property comprised in the certificate is situate, and such officer
shall file the copy in his Book No. 1.
Indian Stamp Act:
Schedule I, Article 18 of the Act provides for stamp duty on certificate
of sale granted to the purchaser of any property sold by public auction by a
Civil or Revenue Court, or Collector or other Revenue-officer� (c) in any
other case The same duty as a conveyance (No. 23) for a consideration equal
to the amount of the purchase money only.
Schedule I, Article 23 of the Act provides for stamp duty on conveyance
- for every Rs. 500 or part thereof in excess of Rs. 1,000, Five rupees.
The term Revenue Officer is defined in Advanced Law Lexicon by P. Ramanatha
Iyer as an Officer employed in or about the business of any branch of the public
revenue. In Sheopatsingh v. Harishchandra, it was held that the term Revenue
Officer will include such Officers of the Income Tax, Sales Tax and Irrigation
Again in Gopi Parshad v. State of Punjab, it was held that the
expression revenues means the income of the nation derived from its taxes,
duties or other sources, for the payment of the nation's expenses. It is a
generally used in referring to income of a Government or governmental sub
division and as so used means all the public moneys which the State collects and
receives from whatever source and in whatever manner.
In Kishore Chandra Deo
Bhanj v. Raghunath Misra, the Village Accountants were also held to be
Similarly, the term Civil Officer is defined in Advanced Law Lexicon by
P. Ramanatha Iyer as any Officer holding appointment under the Government except in
the Military or Naval Service, whether the duties are Executive or Judicial or
in the highest or the lowest departments. The term Civil Officer has to be
understood only in the context of civilians as opposed to persons in Military
Reference To Case Laws:
Arvind Kumar vs. Government of India & Ors
Here, the Supreme Court was required to determine the absolute owner in
the property inherited by the appellant. The suit property was purchased by
the appellant�s father under an auction held by the Official Receiver. The
Official Receiver had issued a sale certificate.
The High Court had passed a judgement on its findings and inter alia stated
that the sale certificate did not convey any title in favour of the appellant�s
father as it was not followed by a registered instrument transferring the
Now, the Supreme Court sought to answer if the appellants father secured
any interest in the suit property as the sale certificate in his favour was not
followed by a registered deed of transfer. In response, it held that no further
deed of transfer was contemplated or required from the court and the sale
certificate is evidence of title.
The question as to whether stamp duty was payable under the Indian Stamp
Act on a certificate of sale issued by the official assignee, was not at all
in issue in that judgment and the sale certificate issued by the official
receiver in favour of the appellant's father in that case was found to have already been
While the court made reference to S. 17(2)(xii) of the Registration Act
and recorded that pursuant to this provision, sale certificate issued by a
court or officer authorised by the court does not need registration, it merely held that
the High Court had previously erred in holding that it does not transfer rights.
Tripower Enterprises (Private) Limited vs. The Sub Registrar, Alandur and
This judgement was passed by single judge bench of the Madras High Court.
Here, a sale certificate was issued under the SARFESI Act to the
petitioner. When the Authorised Officer sent the sale certificate to the Sub
Registrar for filing the said sale certificate u/s. 89 (4) of the Registration
Act, the Sub Registrar refused to file a copy demanding payment of stamp duty
and registration fee.
The petitioner argued that:
Sale certificate was presented for filing u/s. 89 (4) of the Registration
It does not required any stamp duty to be paid upon filing;
The requirement for payment of stamp duty and registration fees would
only arise under Article 18 of the Stamp Act only if original sale
certificate was presented for registration.
To support the above arguments, the petitioner relied upon the ruling in
B. Arvind Kumar vs. Government of India & Ors., N. Naresh Kumar vs. The Inspector
General of Registration and Esjaypee Impex vs. Asst. General Manager and
In N. Naresh Kumar vs. The Inspector General of Registration, the division
bench of this court held that any sale certificate issued under the provisions
of the Security Interest (Enforcement) Rules, 2002 in public auction, is deemed
to be sale by the revenue. Thus that statute makes it very clear that the sale
certificate need not be registered. The Court further held, the payment of
stamp duty may arise when the appellant wants to deal with the property by
selling it. If the appellant uses the document for any other purpose, the
requirement of stamp duty would arise.
In Esjaypee Impex vs. Asst. General Manager and Authorised Officer, the
court directed the original owners to hand over the possession of the property
to the auction purchaser who was the highest bidder in the auction held by the Authorised Officer under the SARFESI Act. Upon the Bank seeking time to validate
the sale certificate issued to the auction purchaser, the court expressed its
view that the mandate of the law only required the authorised officer of the
bank under the SARFESI Act to hand over the duly validated sale certificate to
the auction purchaser with a copy forwarded to the registering authorities as
per section 17 (xii) and 89 (4) of the Registration Act. The Court did not deal
with the inclusion of the meaning of authorised officer to fall within the
purview of sections 17 (xii) and 89 (4) of the Registration Act.
Basis the above arguments, the Court held that when the purchaser goes
for the registration of the original sale certificate issued by the Court
Officer, Article 18 of the Indian Stamp Act would be attracted and stamp
duty is to be paid as per Article 23 of the Registration Act treating it as
conveyance namely auction purchase value of the property. But when a copy of
the sale certificate presented before the Sub Registrar, not for the purpose
of registration but only for purpose of filing it by the Sub registrar in
his office as contemplated under Section 89(4) of the Registration Act, 1908
they cannot refuse to file a copy of the sale certificate by demanding
payment of stamp duty and registration fees to file the same in Book No.1,
as contemplated under Section 89(4) of the Registration Act, 1908.
Ferrous Alloy Forgings Pvt. Ltd. vs. State of Punjab and Ors.
Here, the court sought to answer whether a sale certificate issued in
pursuance of a court auction under a winding up petition is required to be
stamped. On placing reliance on precedents, the court held that want of
affixation of stamp duty on the sale certificate was premature and that such
a document is not compulsorily registrable. It further stated that if the auction
purchaser seeks to use the document for any purpose, the question of impounding
it and referring it to the Collector of stamps could arise. The reliance placed
by the Court on precedents does not deal with the classifications of Officers to
fall within the purview of exclusions in Sections 17 (2) (xii) and 89 (4) of the
Registration Act and its effect on the payment of stamp duty.
Dr. Thiagarajan vs. Inspector General of Registration & Ors
A full bench of the Madras High Court dealt with the question of whether a
public auction conducted under the SARFESI Act wherein a certificate of sale is
issued to the purchaser is liable for register and payment of stamp duty. The
Court went into the details of whether a Authorised Officer appointed by the
court can be included in the meaning of Civil or Revenue Officer as contemplated
u/s. 17 (xxii) and 89 (4) of the Registration Act.
The court held that the Sale
Certificate issued by the Authorised Officer of the bank cannot be agnate with
the Sale Certificate issued by a Civil or Revenue Court. The nomenclature given
to the document issued by the Authorized Officer would be irrelevant for
exemption from payment of stamp duty and the same will not be covered under
Article 18-C Schedule 1 of the Stamp Act.
Therefore, the Sale Certificate issued
by one who is neither Civil or Revenue Officer would not fall under Section
17(2)(xii) of the Registration Act and the Sale Certificate issued by the
Authorized Officer is liable for stamp duty on the market value as per Article
18-C read with Article 23 of Schedule 1 of the Stamp Act.
If proper stamp duty
is not paid for the said Sale Certificate and registered as required under law,
then it is only a still born child and does not confer any right to the
petitioner whatsoever. When the Sale Certificate is not properly stamped and
registered, it is a void document and no right would vest upon the petitioner
based on the same.
Upon considering all aspects above, we have come to the following conclusions:
Sections 17 (2) (xii) and 89 (4) of the Registration Act specifically
pertain to a certificate of sale issued pursuant to an auction conducted by
Civil or Revenue officer. There are no specific provisions under the said
Act to evidence that the sections include a court appointed officer within
The case of Liquidator issued certificate of sale will fall within the
purview of Section 17 (c) of the Registration Act. Consequently, stamp duty
on the instrument will be payable in accordance with Article 23 of Schedule
I of the Indian Stamp Act.
To summarise the findings in relation to the precedents relied upon in the
opinion dated 03 08 2022, we find that the Madras High Court in Tripower
Enterprises (Private) Limited vs. The Sub Registrar, Alandur and Ors. took a
very aggressive view on the inclusion of an Authorised officer of a Bank to mean
Civil or Revenue Officer. In fact, a larger bench of the same Court, had
previously in detail held that section 17 (xii) and 89 (4) of Registration Act
does not include an Authorised officer appointed by the bank, which lend money
to the borrowers. Such Officer acts as an Authorized Officer, only for the
purpose of bringing the property for sale and merely replaces the secured
In Re: Official Liquidator, High Court and Kumararaja Paper Mills (P) Ltd.
vs. Tamil Nadu Principal Revenue Control Officer-cum-The Inspector General of
Registration and Ors. also the Courts have specifically dealt with and held
conclusively on mandatory requirement for registration and payment of stamp duty
on issue of certificate of sale by someone who is not a civil or revenue
As the specific application of Section 17 (xii) and 89 (4) is untested
in relation to liquidation proceedings under the Insolvency and Bankruptcy
Code and relying on the evident inclination of courts to keep the meaning of
civil and revenue officer separate from liquidator or authorised official, we find that
both registration under section 17 (c) of the Registration Act and Article 23 of
the Stamp Act to be mandatory and payable.