Legal provisions involved: Section 9A of the Indian Stamp (Bihar Amendment) Act, 1988; Section 5(7) of the Bihar and Jharkhand Cooperative Societies Act

Judgement by: Supreme Court 

Judge/Bench:  Justice P.S. Narasimha and Justice Atul S. Chandurkar

Facts

Adarsh Sahkari Grih Nirman Swawlambi Society Ltd., a cooperative society, was claiming stamp duty exemption under Section 9A when transferring property to its members. In 2021, the Jharkhand Government issued a Memo requiring a recommendation from the Assistant Registrar as an extra step before the exemption could be granted. The society challenged this, saying the law does not require such a condition. The Jharkhand High Court had upheld the Memo, but the matter went to the Apex Court.

Key legal provisions

• Section 9A of the Indian Stamp (Bihar Amendment) Act, 1988
• Section 5(7) of the Bihar and Jharkhand Cooperative Societies Act

Issues raised

Can the State add extra verification requirements not mentioned in the law? Is a registration certificate alone enough to prove the society exists?

Arguments of the case

The society said the law already ensures the society is genuine and that no extra requirement should be added. The State argued the Memo was needed to stop fake societies from misusing the exemption.

Judgement

The Supreme Court struck down the Memo as illegal. It ruled that once a cooperative society is registered, its certificate is final proof of its existence. The court said the executive cannot add conditions not in the law, and statutory rights like stamp duty exemption must be respected. The society’s exemption was restored.

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