[40. Collector’s power to stamp instruments impounded. ––(1) When the Collector impounds any instrument under section 33, or receives any instrument sent to him under sub-section (2) of section 38, he shall adopt the following procedure :––
(a) when any instrument so impounded or received by the Collector relates to a transaction of immovable property and on which the stamp duty is chargeable on the basis of market value of the subject matter property, the Collector shall for the purpose of assessing proper stamp duty payable thereon, determine the market value of such property by following the procedure as prescribed by rules made by the [State Government] in this behalf ;
(b) if he is of opinion that such instrument is duly stamped, or is not chargeable with duty, he shall certify by endorsement thereon that it is duly stamped, or that it is not so chargeable, as the case may be ; and
(c) If he is of opinion that such instrument is chargeable with duty and is not duly stamped, he shall require the payment of the proper duty or the amount required to make up the same, together with a penalty equal to two per cent of the deficient portion of the stamp duty for every month or part thereof from the date of execution of the instrument, minimum being rupees one hundred :
Provided that when such instrument has been impounded only because it has been written in contravention of section 13 or section 14 or section 14-A, the Collector may, if he thinks fit, remit the whole penalty prescribed by this section.
(2) Subject to the provisions of Chapter VI, every certificate under subsection (1) shall, for the purposes of this Act, be conclusive evidence of the matters stated therein.
(3) Where an instrument has been sent to the Collector under sub-section (2) of section 38, the Collector shall, when he has dealt with it as provided by this section, return it to the impounding officer.]