Madras High Court
Dierdre Elizabeth (Wright) Issar vs Ameer Minhaj on 2 December, 2016
Author: K.K.Sasidharan
Bench: K.K.Sasidharan
IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 02.12.2016 CORAM: THE HONOURABLE MR.JUSTICE K.K.SASIDHARAN C.R.P.(P.D.) No.1700 of 2016 1.Dierdre Elizabeth (Wright) Issar 2. Phyllis Muriel Wright : Petitioners versus 1.Ameer Minhaj 2.Bay Orient Realty Pvt. Ltd., No.47, College Road, Nungambakkam, Chennai 600 006 : Respondents PRAYER: Revision filed against the fair order and decree dated 1 June 2016, in I.A.No.26 of 2014 in O.S.No.23 of 2010 on the file of the District Judge, Nilgiris. For petitioners :: Mr.Rahul Balaji For respondents :: Mr.Swarnam J. Rajagoplan O R D E R
The petitioners filed an interlocutory application before the District Court, Nilgiris in I.A.No.26 of 2014 to decide the admissibility of the unregistered sale agreements and to impound the power of attorney on account of payment of insufficient stamp duty. The application was dismissed by the Trial Court with an observation that nothing has been mentioned in the power of attorney with regard to consideration and that the sale agreements were not required to be registered. The said order is under challenge in this civil revision petition. Submissions:-
2. The learned counsel for the petitioners contended that the predecessor-in-interest of the petitioners executed an agreement dated 12 November 1995, with the second respondent. The vendor, pursuant to the sale agreement dated 12 November 1995, executed a power of attorney dated 2 May 1996 in favour of the second respondent. The power of attorney was given as a continuation of the transaction relating to sale. The first respondent was therefore obliged to pay stamp duty as provided under Article 48(f) of the Indian Stamp Act, 1899. The learned counsel further contended that no reliance could be placed on the document dated 9 July 2003 on account of its non registration.
3. The learned counsel for the respondents supported the order passed by the Trial Court. According to the learned counsel, there was no mention about consideration in the power of attorney and as such, there is no need to pay stamp duty or penalty as contended by the petitioners. Since possession was given to the second respondent as per the earlier sale agreement, there is no need for registration of the subsequent sale agreement. No other contentions were taken before me.
Analysis :-
4. The documents available on record indicate that Thiru.Charles Wright, predecessor-in-interest of the petitioners entered into a sale agreement with the second respondent on 12 November 1995. The second respondent agreed to pay a total sale consideration of Rs.75 lakhs. The predecessor-in-interest of the petitioners executed a general power of attorney in favour of the second respondent on 2 May 1996. There was a clear reference in the general power of attorney with regard to the execution of agreement of sale dated 12 November 1995.
5. The General power of attorney was given in pursuance of the earlier agreement of sale dated 12 November 1995. Since the general power of attorney was given pursuant to the agreement of sale dated 12 November 1995, there is no requirement to incorporate the terms and conditions of the sale agreement in the general power of attorney. The very statement made in the General power of attorney that it is made in pursuance of the agreement of sale dated 12 November 1995 would make it very clear that power of attorney was given on consideration and that the sale agreement was part and parcel of the sale transaction.
6. The learned District Judge was of the view that consideration was not specifically mentioned in the general power of attorney and as such, the document would not attract Article 48(f) of the Indian Stamp Act. Sub Article (F) of Article 48 of the Indian Stamp Act clearly provides that in case power of attorney is given for consideration, authorizing the attorney to sell any immovable property, stamp duty is payable, treating it as a deed of conveyance. In short, the same duty payable for a conveyance deed is payable in case the power of attorney is given for consideration, authorizing the agent to sell immovable property.
7. Even though consideration was not specifically mentioned in the general power of attorney dated 2 May 1996, the fact remains that it was made in pursuance of the agreement dated 12 November 1995. The agreement dated 12 November 1995 contain a clear statement with regard to the consideration agreed to be paid by the second respondent to the predecessor-in-interest of the petitioners. Since power of attorney was given pursuant to the sale agreement dated 12 November 1995, it cannot be said that consideration was not mentioned and as such, the document would not come within the purview of Article 48(f) of the Stamp Act.
8. The Hon'ble Supreme Court in U.S.Sasidharan vs. K.Karunakaran and another, 1989 (4) SCC 482 and Manohar Joshi vs. Nitin Bhaurao patil and another, 1996(1) SCC 169, reiterated the legal position that where a document is sued upon and its terms are not set out in the plaint, but referred to in the plaint, the said document gets incorporated by reference in the plaint. In view of this legal position, there is no basis in the contention taken by the first respondent and observation made by the learned Trial Judge that since consideration was not specifically mentioned in the power of attorney, it cannot be construed as a document of conveyance. Since there was a reference in the power of attorney that it was executed pursuant to the sale agreement dated 12 November 1995 the said document gets incorporated in the power of attorney, meaning thereby it was given on consideration. Therefore, it would attract Stamp duty applicable to a deed of conveyance. The contra finding recorded by the learned Trial Judge is therefore liable to be set aside.
9. The petitioners have taken up another contention with regard to the inadmissibility of the sale agreement dated 9 July 2003. The sale agreement was executed between the respondents 1 and 2 after cancellation of the power of attorney by the predecessor-in-interest of the petitioners by document dated 2 January 2002. There was a statement in the agreement dated 9 July 2003, that vendor has put the purchaser in possession of the property in part performance of the contract. There was a statutory requirement to register such agreements as on the date on which the sale agreement dated 9 July 2003 was executed by the parties, in case there is a recital with regard to putting the purchaser in possession of the property. Section 49 of the Registration Act is a clear bar to make a claim regarding part performance of the contract in case the document was not registered. Section 17(1A) provides that all such documents containing contract to transfer for consideration, any immovable property for the purpose of Section 53(A)of Transfer of Property Act shall be registered.
10.The learned Trial Judge observed that in the sale agreement dated 12 November 1995, there was a statement that the vendor has put the purchaser in possession of the property. The said statement was taken as a material by the learned Trial Judge to arrive at a conclusion that the document dated 9 July 2003 does not require registration. There is no basis for the said finding. The recital in the sale agreement dated 12 November 1995 with regard to part performance of the agreement would not come to the benefit of the first respondent. By the time the sale agreement was executed on 9 July 2003, the Registration Act, was amended by Tamil Nadu Act 48 of 2001. Because of the amendment, sale agreement containing a term attracting Section 53A of T.P. Act, is required to be registered compulsorily. Such being the legal position the learned Trial Judge was not correct in making the observation that there is no need for registration of the subsequent sale agreement, even if there is a defence on the basis of Section 53A of the T.P. Act.
11.There was no agreement between the predecessor-in-interest of the petitioners and the first respondent. The only document on the side of the first respondent is the sale agreement dated 9 July 2003 which was executed by second respondent after cancelling the General power of attorney by document dated 2 January 2002. The first respondent made a claim in his plaint that the second respondent transferred possession of the suit property to him in part performance of the agreement made with him. The alleged transfer of possession was only after the introduction of sub section (1A) of Section 17 of Registration Act as amended by Tamil Nadu Act 48/2001. Since there was a statutory requirement to register such documents, as on the date on which the sale deed dated 9 July 2003 was executed, the said document is inadmissible in evidence to prove part performance of contract. In fact, Registration Act was subsequently amended by Tamil Nadu Act 29 of 2012 with effect from 1 December 2012, making registration compulsory in case agreement was in relation to sale of immovable property of the value of Rs.1000 and upwards. The Legislative mandate as indicated above was not taken note of by the learned Judge while negativing the contention taken by the petitioners.
12. The Hon'ble Supreme Court in Avinashi Kumar Chauhan vs. Vijay Krishna Mishra, 2009(2) SCC 532, referred to the earlier decisions relating to section 35 of the Stamp Act and approved the view expressed by Privy Council in Ram Rattan vs. Paramanand, AIR 1946 PC 51, that the words for any purpose in Section 35 of the Stamp Act should be given their natural meaning and effect and it would include even a collateral purpose.
K.K.SASIDHARAN, J.
(tar)
13.In view of the reasons set out above, the petitioners must succeed.
14. The order passed by the learned District Judge, Nilgiris, dated 1 June 2016 is set aside. The application filed by the petitioners in I.A.No.26 of 2014 is allowed by holding that the General power of attorney dated 2 May 1996 was given for consideration and it was part and parcel of the sale agreement dated 12 November 1995. The sale agreement dated 9 July 2003 is inadmissible in evidence for the purpose of proving part performance in view of the statutory bar.
15. In upshot, I allow the civil revision petition. No costs. Consequently, C.M.P.Nos.9069, 9070 of 2016 are closed.
02.12.2016 Index:Yes tar To The District Judge, Nilgiris.
C.R.P.(P.D.) No.1700 of 2016http://www.judis.nic.in