Company paid Rs 440 for registration
Govt demanding nearly Rs 20 crore towards deficit registration fees based on the audit objections. (Photo: DC/File)
Chennai: M/s Gammon India Limited, which entered into a joint venture agreement with a Russian company to execute the works of the Chennai Metro Rail (CMRL) project involving nearly Rs 2,000 crore and paid a paltry sum of Rs 440 towards registration fees for registering the agreements, got into trouble after the state government issued notices, demanding nearly Rs 20 crore towards deficit registration fees based on the audit objections. The company has now approached the Madras high court, challenging the state government’s demand.
Justice V. Ramasubramanian before whom the petition filed by Gammon India Limited came up for hearing, adjourned it to December 1, after additional government pleader P Sanjaigandhi took notice for the Inspector General of Registration, District Registrar (Administration) and Joint Sub-Registrar, Chennai.
According to the petitioner, it entered into a joint venture agreement with M/s OJSC Moscow Metrostroy, a company established and existing under the laws of Russia, with a view to collaborate and jointly execute a contract for the design and construction of CMRL’s underground stations at three locations in Chennai.
The agreement sets out various terms governing the relationship between the two parties to the joint venture, management of the joint venture through a supervisory board, and on a day-to-day basis, by the project management.
In view of the fact that it was a joint venture agreement, neither party was required to nor paid consideration to the other for entering into the agreement and no property was transferred under the agreement.
The Table of Fees prescribed under section 78 of the Registration Act does not provide for fixed fees in respect of agreements entered between parties in forming a joint venture to execute works that may be awarded under independent agreements by third parties. Therefore, the agreement was not susceptible to valuation.
However, for the limited purpose of computing stamp duty and registration fees, they specified that the consideration would be Rs10,000 and paid a sum of Rs 220 each as registration fees and the two documents were registered on March 17, 2011. Now, nearly three years later, it had received notices from the District Registrar, demanding Rs 9.32 crore and Rs 10.12 crore as deficit registration fees based on the audit objections raised by the Accountant General of Tamil Nadu, the petitioner added.
The petitioner said that the agreement executed and registered merely governs the relationship between the parties and was not a construction agreement. CMRL was not a party to the said agreements and the registration fee could not be commuted on the basis of the value of the construction contract entered between the parties to the agreement and CMRL. Therefore, the registration fee of Rs 220 each was proper and not in deficit, it added.
( Source : dc correspondent )
Next Story
