Legal Review and Analysis of Adarsh Sahkari Grih Nirman Swayam Samiti Ltd vs The State of Jharkhand & Ors 2025 INSC 1389
Case Synopsis
Adarsh Sahkari Grih Nirman Swayam Samiti Ltd. vs. The State of Jharkhand & Ors. (2025 INSC 1389)
Supreme Court Quashes Redundant Bureaucratic Hurdle; Upholds that Conclusive Statutory Proof Cannot Be Supplanted by Executive Fiat. The judgment affirms that when a law declares a registration certificate as conclusive evidence of a cooperative society's existence, the executive cannot impose an extra layer of verification. It strikes down an administrative memo for being an illegal, irrelevant, and burdensome requirement that undermined a statutory exemption and the principles of ease of doing business.
1. Heading of the Judgment
Case Name: Adarsh Sahkari Grih Nirman Swayam Samiti Ltd. vs. The State of Jharkhand & Ors.
Citation: 2025 INSC 1389
Court: Supreme Court of India
Bench: Honourable Mr. Justice Pamidighantam Sri Narasimha and Honourable Mr. Justice Atul S. Chandurkar
Date of Judgment: December 5, 2025
2. Related Laws and Sections
Indian Stamp Act, 1899: Section 9 (Power to reduce, remit, or compound duties).
Indian Stamp (Bihar Amendment) Act, 1988: Section 9A (Exemption from stamp duty on instruments relating to transfer of premises by Cooperative Societies to their members).
Jharkhand Self-Supporting Cooperative Societies Act, 1996: Section 5 (Registration of Cooperative Societies), Section 5(7) (Certificate of registration as conclusive proof), Section 6 (Cooperative Society to be a body corporate).
Registration Act, 1908: Section 34 (Enquiry before registration).
Constitution of India, 1950: Article 226 (Power of High Courts to issue certain writs).
3. Judgment Details
A. Facts of the Case
The appellant, Adarsh Sahkari Grih Nirman Swayam Samiti Ltd., is a cooperative society registered under the Jharkhand Self-Supporting Cooperative Societies Act, 1996. Its objective is to provide housing to its members. The society is entitled to an exemption from stamp duty under Section 9A of the Indian Stamp (Bihar Amendment) Act, 1988, for instruments transferring premises to its members.
In 2009, the Principal Secretary of the Registration Department, Jharkhand, issued a Memo (No. 494 dated 20.02.2009). This Memo mandated that the stamp duty exemption under Section 9A would only be granted upon a prior recommendation from the Assistant Registrar of Cooperative Societies. The Memo directed all District Sub-Registrars to insist on this recommendation.
The appellant challenged this Memo before the Jharkhand High Court via a writ petition, arguing that it created an unnecessary, ultra vires hurdle and undermined the autonomy of cooperative societies. Both the Single Judge and the Division Bench of the High Court dismissed the petition, holding that the requirement was a valid administrative measure to prevent fake societies from availing the exemption. Aggrieved, the appellant appealed to the Supreme Court.
B. Issues Before the Supreme Court
Whether the impugned Memo dated 20.02.2009, issued by the Principal Secretary, Registration Department, Jharkhand, mandating a recommendation from the Assistant Registrar of Cooperative Societies as a precondition for granting stamp duty exemption under Section 9A, is legal and valid?
Whether such an administrative instruction imposes a superfluous and illegal requirement, contrary to the statutory scheme and the principles of good governance?
C. Ratio Decidendi (Court’s Reasoning)
I. Primacy of Statutory Certification Over Executive Instructions:
The Supreme Court held that a cooperative society, once registered under Section 5 of the Jharkhand Act, becomes a body corporate under Section 6. Crucially, Section 5(7) of the Act declares the certificate of registration issued by the Registrar as "conclusive evidence" of the society's existence and status. This statutory certification is binding on all state instrumentalities.
II. The Requirement is Superfluous and an Irrelevant Consideration:
The Court reasoned that the objective of the Memo—to prevent fake societies from claiming benefits—was already fully met by the conclusive statutory certificate. Insisting on an additional recommendation from the Assistant Registrar added no value to the integrity of the transaction. Therefore, this precondition was an "irrelevant consideration" in administrative law. An administrative action based on irrelevant considerations is illegal.
III. Simplicity and Ease of Doing Business as Pillars of Good Governance:
The judgment emphasized that simplicity in public transactions is a virtue of good governance. Laws and procedures should be clear and straightforward, avoiding redundant requirements that waste time and resources. The impugned Memo created an unnecessary bureaucratic layer, disrupting the ease of transaction for cooperative societies without any legitimate public purpose.
IV. Distinction Between Power to Regulate and Power to Create Hurdles:
While the State has the power under the Registration Act to make inquiries to ensure proper stamping and registration, this power does not extend to questioning the validity of a cooperative society's registration when the statute itself provides conclusive proof of it. The Memo overstepped this boundary by effectively allowing a subordinate officer (Assistant Registrar) to re-verify what the law already deemed conclusive.
4. Core Principle of the Judgment
The Supreme Court addressed the core issue of the limits of executive power to impose procedural conditions that conflict with a substantive statutory right.
Judicial Analysis on Illegal Administrative Overreach and Conclusive Statutory Proof:
The core of the judgment is a robust affirmation that the executive cannot dilute a statutory right by imposing additional, unwarranted procedural conditions. Section 9A of the Stamp Act grants a clear exemption right to cooperative societies. The Jharkhand Cooperative Societies Act provides a conclusive certificate of registration. The Court held that when the statute itself provides definitive proof (conclusive evidence), any executive instruction demanding further verification is not just unnecessary but illegal. It constitutes an arbitrary exercise of power that undermines the rule of law and the legislature's intent. The ruling reinforces that administrative convenience or a vague suspicion of misuse cannot justify creating hurdles that negate a benefit expressly granted by law. It champions the principle of "simplicity in public transactions" as an essential component of non-arbitrary, good governance under Article 14 of the Constitution.
5. Final Outcome and Directions
The Supreme Court allowed the appeal. It set aside the impugned judgment of the Jharkhand High Court in LPA No. 553 of 2022. Consequently, the Memo No. 494 dated 20.02.2009 issued by the Principal Secretary, Registration Department, Jharkhand, was declared illegal and quashed. The registering authorities were directed to grant the stamp duty exemption under Section 9A of the Indian Stamp (Bihar Amendment) Act, 1988, to the appellant and similarly situated cooperative societies based on their certificate of registration, without insisting on any further recommendation from the Assistant Registrar of Cooperative Societies.
6. MCQ Questions Based on the Judgment
Question 1: In Adarsh Sahkari Grih Nirman Samiti Ltd. vs. State of Jharkhand (2025 INSC 1389), on what primary ground did the Supreme Court declare the government Memo illegal?
A. The Memo imposed an excessively high fee for registration.
B. The Memo required a recommendation that was superfluous, as the society's certificate of registration was already conclusive proof of its existence by law.
C. The Memo was issued without the signature of the Chief Secretary.
D. The Memo applied only to housing societies and not to other types of cooperatives.
Question 2: Which statutory provision formed the bedrock of the Supreme Court's reasoning that no further verification of a cooperative society's existence was needed?
A. Section 9 of the Indian Stamp Act, 1899.
B. Section 34 of the Registration Act, 1908.
C. Section 5(7) of the Jharkhand Self-Supporting Cooperative Societies Act, 1996, which makes the certificate of registration "conclusive evidence."
D. Article 226 of the Constitution of India.
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