In this judgment, the Supreme Court held that executive mandates imposing superfluous requirements beyond statutory provisions constitute illegality in administrative law. It ruled that requiring a Cooperative Registrar’s recommendation for stamp duty exemption under Section 9A of the Stamp Act is irrelevant and unnecessary, as a society’s registration certificate is conclusive proof of its existence under Section 5(7) of the Cooperative Societies Act.
Facts Of The Case:
The appellant, Adarsh Sahkari Grih Nirman Swawalambi Society Ltd., a cooperative society registered under the Jharkhand Self-Supporting Cooperative Societies Act, 1996, challenged an executive memorandum issued by the Principal Secretary of the Registration Department, Jharkhand. The impugned Memo No. 494, dated February 20, 2009, directed all District Sub-Registrars that the stamp duty exemption under Section 9A of the Indian Stamp (Bihar Amendment) Act, 1988 would only be granted for property transfers by cooperative societies to their members if the transaction was recommended by the Assistant Registrar, Cooperative Society.The society contended that this additional requirement created an unnecessary procedural hurdle, was ultra vires the Stamp Act, and infringed upon the autonomy granted to cooperative societies under the 1996 Act. It argued that the Assistant Registrar had no authority under the central Registration Act, 1908, to approve or reject such transfers, and that the memorandum was issued without any consultation, violating principles of natural justice. However, the Single Judge and Division Bench of the Jharkhand High Court dismissed the writ petition, holding that the requirement was necessary to prevent fake societies from availing the exemption and that the registering authority lacked the power to verify a society’s validity. Aggrieved, the cooperative society appealed to the Supreme Court.
Procedural History:
The appellant cooperative society initially filed a writ petition before the Jharkhand High Court under Article 226 of the Constitution of India, challenging the validity of Memorandum No. 494 dated February 20, 2009, issued by the Principal Secretary, Registration Department. The Single Judge of the High Court dismissed the writ petition, holding that the impugned memorandum was not in contravention of the Stamp Act and that the requirement of recommendation from the Assistant Registrar was necessary to ensure only validly registered cooperative societies availed the exemption benefit. The court further observed that while registering authorities possess powers under Section 34 of the Registration Act, 1908 to make inquiries regarding executants and proper stamping, this power does not extend to examining the validity of a cooperative society’s registration or satisfaction of conditions for stamp duty exemption under Section 9A.Aggrieved by the Single Judge’s decision, the appellant filed a Letters Patent Appeal before the Division Bench of the Jharkhand High Court. The Division Bench concurred with the Single Judge’s reasoning and dismissed the appeal, affirming that the executive instruction was intended to simplify the process and benefit cooperative societies. The Division Bench similarly refused to exercise judicial review, maintaining that the memorandum served a legitimate purpose in preventing fake societies from claiming undue exemption benefits.Thereafter, the appellant approached the Supreme Court of India by filing a Special Leave Petition under Article 136 of the Constitution. The Supreme Court granted leave and heard the matter as Civil Appeal arising out of SLP (C) Diary No. 7678 of 2024. The Supreme Court ultimately reversed the High Court’s judgment and allowed the appeal, holding that the impugned memorandum was illegal as it relied on a superfluous and redundant requirement contrary to statutory provisions.
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Court Observation:
The Supreme Court made several significant observations regarding administrative law principles and the interpretation of statutory provisions. The Court observed that simplicity in public transactions constitutes good governance, and constitutional courts must uphold this virtue to strengthen the rule of law and ensure access to justice. It noted that executive actions mandating unnecessary and excessive requirements must be set aside as illegal, just as decisions based on irrelevant considerations are struck down. The Court emphasized that irrelevant considerations include insistence on performing acts or submitting documents that neither have relevance nor add value to the purpose or object of the law or policy in place, and such requirements are demonstrably superfluous and unnecessary, consuming limited time and human resources while directly impacting efficiency and good governance.Regarding the certificate of registration under the Cooperative Societies Act, the Court observed that Section 5(7) of the Jharkhand Self-Supporting Cooperative Societies Act, 1996 declares that the certificate of registration signed and sealed by the Registrar shall be conclusive evidence of the society’s existence and continuation as a body corporate. The Court held that the State and its instrumentalities are bound by this certification, and no further question should arise about the existence or authenticity of the cooperative society. Consequently, requiring a recommendation from the Assistant Registrar when the certificate itself is conclusive proof was deemed superfluous and disruptive of ease of transaction without any value addition to the integrity of the transaction. The Court further observed that Section 9A of the Stamp Act creates both a right in favour of cooperative societies to transfer premises without stamp duty and a corresponding duty on authorities to register such instruments without further stamp duty requirements.
Final Decision & Judgement:
The Supreme Court allowed the appeal and set aside the judgment and order of the Jharkhand High Court passed in LPA No. 553 of 2022. The Court held that Memorandum No. 494 dated February 20, 2009, issued by the Principal Secretary, Department of Registration, was illegal and liable to be quashed. The illegality stemmed from the memorandum requiring a recommendation from the Assistant Registrar, Cooperative Society as a precondition for availing stamp duty exemption under Section 9A of the Indian Stamp (Bihar Amendment) Act, 1988, which the Court found to be based on irrelevant considerations and entirely superfluous. The Court reasoned that once a cooperative society is registered and possesses a certificate of registration under Section 5 of the Jharkhand Self-Supporting Cooperative Societies Act, 1996, such certificate constitutes conclusive evidence of the society’s existence as a body corporate under Section 5(7) of that Act. Therefore, the additional requirement of a recommendation from the Assistant Registrar served no legitimate purpose and failed to add any value to the integrity of property transactions. The Court declared that the memorandum was disruptive of ease of transactions and imposed unnecessary procedural burdens without statutory authority. Consequently, the Supreme Court granted relief to the appellant cooperative society by striking down the impugned executive instruction, thereby restoring the position that the certificate of registration alone suffices for claiming stamp duty exemption on property transfers by cooperative societies to their members.
Case Details:
Case Title: Adarsh Sahkari Grih Nirman Swawalambi Society Ltd. v. The State of Jharkhand & Ors. Citation: 2025 INSC 1389 Civil Appeal No.: Diary No. 7678 of 2024) Date of Judgment: December 05, 2025 Bench/Judges: Justice Jamidighantam Sri Narasimha and Justice Atul S. Chandurkar
Download The Judgement Here