Mukesh Kumar vs Kulvinder Singh on 10 March, 2021

[Cites 23, Cited by 1]

Madhya Pradesh High Court

Mukesh Kumar vs Kulvinder Singh on 10 March, 2021

Equivalent citations: AIRONLINE 2021 MP 220

(1) The present petition is being filed challenging the order dated :: 2 :: M.P.No.2045/2018 (Mukesh Kumar Vs. Kulvinder Singh (dead) through its legal heirs Jaspreet Kaur and others) 2.4.2018, whereby the learned Trial Court has calculated the deficit stamp duty to be paid upon the document i.e. agreement to sell dated 15.7.2013 and despite the petitioner arguing the fact that he does not want to tender the said agreement to sell in evidence, the learned Trial Court has sent the same to the Collector for impounding. It is pointed out that the civil suit for specific performance of agreement to sell and for permanent injunction with respect to the property as mentioned in para 1 of the plaint was filed by the petitioner-plaintiff. The defendant no.1 and 2, who happens to be the husband and wife have executed an agreement to sell on 15.7.2013 for consideration of Rs.2,50,000/- per bigha and received advance of Rs.5,00,000/- vide cheque no.957126 & 957127 in presence of witnesses. The sale deed was executed in the month of December, 2013 and after execution the remaining consideration amount was to be paid, but despite of several requests, no heed was paid by the defendants no.1 and 2. A notice was issued by the plaintiff on 2.1.2014 showing his readiness and willingness for execution of the sale deed, but the notice was not replied, therefore, again a notice on 15.2.2015 was issued, but the same was also not replied which forced the petitioner to file a civil suit before the learned Trial Court for specific performance of agreement to sell and permanent injunction. (2) It is argued that the written statement was filed by the :: 3 :: M.P.No.2045/2018 (Mukesh Kumar Vs. Kulvinder Singh (dead) through its legal heirs Jaspreet Kaur and others) defendants no.1 and 2 denying all the averments of the plaint and has also denied from agreement dated 15.7.2013 and further stated that the so called advance of Rs.5,00,000/- with respect to some other transactions and ultimately has prayed for dismissal. The plaintiff has filed an affidavit under Order 18 Rule 4 of CPC during the course of evidence when the petitioner's counsel tried to mark exhibit upon the agreement dated 15.7.2013 and objection under section 35 and 38 (2) of Indian Stamp Act was filed by the respondents pointing out the fact that the agreement to sell is not properly stamped. The objection was entertained by the learned Trial Court. The plaintiff counsel on 2.4.2018 stated that they do not want to rely upon the agreement to sell dated 15.7.2013 and prayed for recording of plaintiff's evidence without placing reliance upon the agreement to sell and without marking it as exhibit. It is submitted that once the plaintiff has shown his dis-interest and if he has stated that he does not want to rely upon the document, such document cannot be forced to be relied upon and should have been returned back to the plaintiff. He has relied upon the judgment passed in the case of Satya Narayan Vs. Ram Singh, 2007 (3) MPLJ 384 and in the case of Gajanand Awasthy Vs. Sharif Khan, 2008 (II) MPWN 63 to the effect that deficit stamp duty could not have been calculated by the learned Trial Court, it was the duty of the Collector. He has further relied upon the :: 4 :: M.P.No.2045/2018 (Mukesh Kumar Vs. Kulvinder Singh (dead) through its legal heirs Jaspreet Kaur and others) judgment passed in the case of K.B.Jayaram and another Vs. Navineethamma and others, AIR 2003 Karnataka 241 and order passed in the case of Manoj Shivhare Vs. Sunil Kumar Khandelwal and others, W.P.No.8429/2012 order dated 9.11.2017, wherein it is held by this Court that in case the plaintiff is not willing to get the document exhibited he cannot be forced to pay the deficit stamp duty. In such circumstances the order passed by the learned Trial Court is perse illegal and has prayed for setting aside of the impugned order.

(3) Per contra counsel appearing for the respondents has opposed the contentions of the petitioner and has submitted that the order passed are just and proper as it was the duty of the learned Trial Court to impound the documents and send it to the Collector of the districts for payment of deficit court fees in terms of sections 33, 35 (a) and 38 of the Indian Stamp Act, 1899. It is argued that the learned Trial Court has not committed any error in even calculating the deficit stamp duty because as soon as the document is brought to the notice of the Court, the Court is duty bound to impound the document and calculate the deficit stamps duty and in case the petitioner/plaintiff deposit the entire stamp duty calculated by the learned Trial Court without any objection then the document could have been considered in evidence after deposition of the stamp duty, but if any objection is :: 5 :: M.P.No.2045/2018 (Mukesh Kumar Vs. Kulvinder Singh (dead) through its legal heirs Jaspreet Kaur and others) raised with respect to calculation being made by the learned Trial Court then the learned Trial Court was duty bound to send the document to the Collector for proper assessment of the stamp duty. In the present case the learned Trial Court has initially assessed the deficit stamp duty and the petitioner has shown his dis-interest to deposit the same, therefore, the document agreement to sell was rightly being impounded and send to the Collector for calculation of the deficit stamp duty. He has relied upon the judgment passed by the Division Bench of this Court in the case of Abdul Hamid Vs. State, 1964 JLJ 603 and also relied upon the decision passed in the Full Bench in the case of Balkrishna Vs. the Board of Revenue M.P., 1969 MPLJ 827 and has argued that no illegality is being committed by the learned Trial Court in passing the impugned order. He has further relied upon the judgment passed in the case of Bhagwati Prasad Vs. Mathura Devi, 2012 (3) M.P.L.J. 170 and has argued that the learned Trial Court has passed a well reasoned order. As soon as the document i.e. agreement to sell brought to the knowledge of the learned Trial Court which was not properly stamped, the learned Trial Court has impounded the document and directed for payment of deficit court fees after calculation. No illegality is being committed. He has prayed for dismissal of the petition.

:: 6 :: M.P.No.2045/2018 (Mukesh Kumar Vs. Kulvinder Singh (dead) through its legal heirs Jaspreet Kaur and others) (4) Heard the learned counsel for the parties and perused the record.

(5) From the perusal of the record, it is undisputed that in a civil suit filed for specific performance of agreement to sell the civil suit is at the stage of evidence and the agreement to sell is dated 15.7.2013, document is tried to be exhibited by the plaintiff, the objection was raised under section 35 and 38 of the Indian Stamps Act, 1899 by the defendants with respect to document being improperly stamped. The learned Trial Court has taken a cognizance of the matter and has impounded the matter calculated the deficit stamp duty and when the plaintiff has denied to pay the deficit stamp duty then the document was impounded and send to the Collector, District Shivpuri for calculation of the correct stamp duty and for impounding of document. The relevant provisions of Stamps Act, 1899 are required to be seen.

(6) Section 33 of the Indian Stamp Act deals with examination and impounding of instruments, which reads as under:

"33. Examination and impounding of instruments.- (1) Every person having by law or consent of parties, authority to receive evidence, and every person in charge of a public office, except an officer of police, before whom any instrument, chargeable, in his opinion, with duty, is produced or comes in the performance of his :: 7 :: M.P.No.2045/2018 (Mukesh Kumar Vs. Kulvinder Singh (dead) through its legal heirs Jaspreet Kaur and others) functions, shall, if it appears to him that such instrument is not duly stamped, impound the same.

(2) For that purpose every such person shall examine every instrument so chargeable and so produced or coming before him, in order to ascertain whether it is stamped with a stamp of the value and description required by the law in force in [India] when such instrument was executed or first executed:

Provided that--

(a) nothing herein contained shall be deemed to require any Magistrate or Judge of a Criminal Court to examine or impound, if he does not think fit so to do, any instrument coming before him in the course of any proceeding other than a proceeding under Chapter XII or Chapter XXXVI of the Code of Criminal Procedure, 1898 (5 of 1898);

         (b)     in the case of a Judge of a High Court, the
         duty     of   examining    and    impounding     any

instrument under this section may be delegated to such officer as the Court appoints in this behalf. (3) For the purposes of this section, in cases of doubt,--

(a) [the [State Government]] may determine what offices shall be deemed to be public offices; and

(b) [the [State Government]] may determine who shall be deemed to be persons in charge of :: 8 :: M.P.No.2045/2018 (Mukesh Kumar Vs. Kulvinder Singh (dead) through its legal heirs Jaspreet Kaur and others) public offices."

(7) Section 35 of the Indian Stamp Act deals with instruments not duly stamped inadmissible in evidence, etc. is required to be seen. Section 35 of the Indian Stamp Act reads as under:

"35. Instruments not duly stamped inadmissible in evidence, etc.--No instrument chargeable with duty shall be admitted in evidence for any purpose by any person having by law or consent of parties authority to receive evidence, or shall be acted upon, registered or authenticated by any such person or by any public officer, unless such instrument is duly stamped: Provided that--

(a) any such instrument [shall], be admitted in evidence on payment of the duty with which the same is chargeable, or, in the case of an instrument insufficiently stamped, of the amount required to make up such duty, together with a penalty of five rupees, or, when ten times the amount of the proper duty or deficient portion thereof exceeds five rupees, of a sum equal to ten times such duty or portion;

(b) where any person from whom a stamped receipt could have been demanded, has given an unstamped receipt and such receipt, if stamped, would be admissible in evidence against him, then such receipt shall be admitted in evidence against him, then such receipt shall be admitted in evidence against him on payment of a penalty :: 9 :: M.P.No.2045/2018 (Mukesh Kumar Vs. Kulvinder Singh (dead) through its legal heirs Jaspreet Kaur and others) of one rupee by the person tendering it;

(c) where a contract or agreement of any kind is effected by correspondence consisting of two or more letters and any one of the letters bears the proper stamp, the contract or agreement shall be deemed to be duly stamped;

(d) nothing herein contained shall prevent the admission of any instrument in evidence in any proceeding in a Criminal Court, other than a proceeding under Chapter XII or Chapter XXXVI of the Code of Criminal Procedure, 1898 (5 of 1898);

(e) nothing herein contained shall prevent the admission of any instrument in any Court when such instrument has been executed by or on behalf of [the [Government]] or where it bears the certificate of the Collector as provided by section 32 or any other provision of this Act."

(8) And Section 38 of the Indian Stamp Act deals with instruments impounded, how dealt with, which reads as under:

"38. Instruments impounded, how dealt with.--

(1) Where the person impounding an instrument under section 33 has by law or consent of parties authority to receive evidence and admits such instrument in evidence upon payment of a penalty as provided by section 35 or of duty as provided by section 37, he shall send to the Collector an authenticated copy of such instrument, together with a certificate in writing, :: 10 :: M.P.No.2045/2018 (Mukesh Kumar Vs. Kulvinder Singh (dead) through its legal heirs Jaspreet Kaur and others) stating the amount of duty and penalty levied in respect thereof, and shall send such amount to the Collector, or to such person as he may appoint in this behalf.

(2) In every other case, the person so impounding an instrument shall send it in original to the Collector."

(9) From perusal of aforesaid sections i.e. sections 33, 35 and 38 it is apparently clear that as soon as the document which is insufficiently stamped is brought to the notice of the authority of the Court and in case an objection is taken prior to admission of the document in question by any of the party or exhibiting the document in evidence, it is the duty of the Court or the authority to impound that document and calculate the deficit stamp duty and asked the person to deposit the same and in case he refuses to deposit the same, the document is to be impounded and send to the Collector for calculation of the stamp duty and for payment of the correct stamp duty alongwith penalty and if he agrees for payment of stamp duty as calculated by the Trial Court and is ready to pay the same, the same should be deposited and the document should be considered in evidence. The Division Bench of this Court in the case of Abdul Hamid (supra) has held as under:

"4. Having heard learned counsel for the parties, we have reached the conclusion that the :: 11 :: M.P.No.2045/2018 (Mukesh Kumar Vs. Kulvinder Singh (dead) through its legal heirs Jaspreet Kaur and others) only relief which the petitioner can be granted is a direction to the Collector to decide in accordance with section 40 the matter of the duty payable on the instrument forwarded to him by the Additional District Judge, Satna. Under section 33, read with section 38 of the Act, the Additional District Judge had no doubt the power to impound the document filed by the petitioner and to admit it in evidence upon payment of duty and penalty determined by him. When the amount of duty and penalty is paid by the person concerned, then the Court impounding the document and imposing a duty and penalty has to send under section 38 (1) of the Act an authenticated copy of the instrument, together with the amount paid, to the Collector. In every other case, the authority or the person impounding the instrument has to send it in original to the Collector, as laid down in sub-

section (2) of section 38. Thus, if the instrument is not admitted in evidence because of failure of the party to pay the amount of duty and penalty, then the Court impounding the document has to send it in original to the Collector, as required by section 38 (2). In the present case, the petitioner did not at all pay any duty and penalty. The document was therefore not admitted in evidence. The Additional District Judge, therefore, should have sent the instrument in original to the Collector, :: 12 :: M.P.No.2045/2018 (Mukesh Kumar Vs. Kulvinder Singh (dead) through its legal heirs Jaspreet Kaur and others) as laid down in section 38 (2). Actually, the Additional District Judge sent the document in original to the Collector, albeit with a direction that the Collector should recover the amount of duty and penalty imposed by him. The Additional District Judge had no power to give such a direction. When the document was not admitted in evidence for the petitioner's failure in the payment of the amount of duty and penalty, the document had to be sent to the Collector under section 38 (2).

5. Now, section 40 (1) of the Act says that when the Collector received any instrument sent under section 38 (2), not being an instrument chargeable with a duty not exceeding ten Naye Paise only or a bill of exchange or promissory note, he shall adopt the procedure laid down in that section. Under section 40 the Collector has to decide for himself the nature of the instrument and the proper duty payable on it and the amount of penalty that should be imposed if the document is not only stamped. In the present case, though the Additional District Judge determined the amount of duty and penalty in respect of the document under section 38 (1) the transmission of the document to the Collector was lawful under sub-section (2) in asmuch as the petitioner did not pay the amount of duty and penalty levied by the Additional District Judge and the document was not admitted in evidence. :: 13 :: M.P.No.2045/2018 (Mukesh Kumar Vs. Kulvinder Singh (dead) through its legal heirs Jaspreet Kaur and others) That being the position the Collector erred in thinking that he was bound by the determination of the Additional District Judge on the question of nature of the instrument and the amount of duty and penalty leviable in respect of it, and that all that he had to do was to recover the amount of duty and penalty as levied by the Additional District Judge, Satna. The Collector should have entertained the petitioner's objection and determined the nature of the instrument and the amount of duty and penalty leviable in respect of it, uninfluenced by the decision of the Additional District Judge, Satna, as regards the nature of the instrument and the amount of duty and penalty. The recovery proceedings started by the Collector, Satna without arriving at any determination as required by section 40 of the Act are wholly illegal."

(10) The matter again came before the Full Bench of this Court in the case of Balkrishna (supra), wherein the Full Bench has held as under:

"10. It was an argument that there was no conscious admission of the document by the Court. It was mechanically produced when Balkrishna was in the witness-box and it was mechanically marked as an exhibit. The learned Judge of trial Court also wrote remark to that effect when objection was taken to the :: 14 :: M.P.No.2045/2018 (Mukesh Kumar Vs. Kulvinder Singh (dead) through its legal heirs Jaspreet Kaur and others) admissibility of the document during the course of recording of Hiralal's evidence. But the law is quite clear on the point. When a document is tendered in evidence and before it is marked as exhibit in a case, the trial Court has to judicially determine whether it is properly stamped or not.

Once it has been marked as exhibit in a case and has been used by the parties in examination-in- chief or cross-examination of a witness, section 36 steps in."

12. On the above analysis, it is abundantly clear that an instrument can be sent to the Collector under section 38 (2) of the Stamp Act only when it is impounded under section 33, it is not admitted in evidence on payment of penalty and/or duty with the aid of section 35. Section 38 (2) has no application to a case where the document has been admitted in evidence."

(11) Further in the case of Bhagwati Prasad (supra) the Court has held as under:

"7. I have considered the submissions made on both sides. Section 33 of the Act provides that when an insufficient stamped document is filed in the Court, the Court is duty bound to impound the same. Section 35 of the Act provides that no instrument chargeable with duty shall be admitted in evidence for any purpose unless such instrument is duly stamped. Clause (a) of the proviso to section 35 provides that such an :: 15 :: M.P.No.2045/2018 (Mukesh Kumar Vs. Kulvinder Singh (dead) through its legal heirs Jaspreet Kaur and others) instrument shall, be admitted in evidence on payment of the duty with which the same is chargeable, or, in the case of an instrument insufficiently stamped, of the amount required to make up such duty, together with a penalty of five rupees, or when ten times the amount of the property duty or deficient portion thereof exceeds five rupees, of a sum equal to ten times such duty or portion. Section 38 prescribes the procedure after impounding document. Section 38(1) provides that when the person impounding an instrument under section 33 has by law or consent of parties authority to receive evidence and admit such instrument in evidence upon payment of a penalty as provided by section 35, or of duty as provided by section 37, he shall send to the Collector an authenticated copy of such instrument, together with a certificate in writing, stating the amount of duty and penalty levied in respect thereof, and shall send such amount to the Collector, or to such person as he may appoint in this behalf. Sub-section (2) of section 38 provides that in every other case, the person so impounding an instrument shall send it in original to the Collector. Section 40 of the Act deals with power of the Collector to stamp the instrument which have been impounded. Section 40(1)(b) provides that if the Collector is of the opinion that instrument is chargeable with duty and is not duly stamped, he shall require the :: 16 :: M.P.No.2045/2018 (Mukesh Kumar Vs. Kulvinder Singh (dead) through its legal heirs Jaspreet Kaur and others) payment of the property duty or the amount required to make up the same, together with a penalty of five rupees; or, if he thinks fit, an amount not exceeding ten times the amount of the proper duty or of the deficient portion thereof, whether such amount exceeds or falls short of five rupees.

8. Thus, the scheme of the Act is abundantly clear. Where the instrument is chargeable to duty is tendered in the Court, the Court is duty bound to impound the same, if it is of the opinion that the document is not duly stamped. The Court under section 35 of the Act has the power to admit the document in question on payment of duty with which the instrument is chargeable or amount required to make up such deficiency together with penalty, limits of which are prescribed in the section. There is no other course open to the Court, once it is found that instrument tendered in evidence is not duly stamped.

However, if the instrument has been impounded under section 33 of the Act, but has not been admitted in evidence, on payment of penalty and duty the Court has to send the document to the Collector under section 38(2) of the Act and the Collector is required to deal with the document in the manner prescribed under section 40 of the Act.

9. The Full Bench of this Court in Nathuram Arjun vs. Siyasharan Harprasad, 1969 MPLJ 349 :: 17 :: M.P.No.2045/2018 (Mukesh Kumar Vs. Kulvinder Singh (dead) through its legal heirs Jaspreet Kaur and others) = AIR 1970 M. P. 79, has held that the instrument can be sent to the Collector under section 38(2) of the Act only when it is impounded under section 33 of the Act, but has not been admitted in evidence on payment of penalty and or duty with the aid of section 35 of the Act.

10. The Supreme Court in Petiti Subba Rao (supra), has held that where the party fails to pay the penalty suggested by the Court the document impounded has to be sent to the Collector for the purpose of taking further steps in respect of document as provided in section 40 of the Act.

11. In the backdrop of aforesaid legal position if the impugned order is seen, the document is yet to be tendered in evidence. If the petitioners tender the document in evidence, the trial Court shall deal with the document in the light of the aforesaid well settled legal position and in view of the law laid down by the Supreme Court in Petiti Subba Rao's case as well as by the Full Bench of this Court in Nathuram Arjun's case (supra).

12. With the aforesaid direction, the writ petition is disposed of."

(12) From perusal of all the aforesaid sections and the law laid down by the Courts, it is apparently clear that the document not sufficiently stamped has to be impounded once it is brought to the knowledge of the Court or the authorities and is to be sent to the :: 18 :: M.P.No.2045/2018 (Mukesh Kumar Vs. Kulvinder Singh (dead) through its legal heirs Jaspreet Kaur and others) Collector in original. The aforesaid original document cannot be returned back to the concerning party without the proper payment of stamp duty, despite of the fact that he has chosen not to place reliance upon the document in the evidence and not to exhibit aforesaid document in the evidence. It is a choice of the party whether to rely upon such document or not and to pay proper stamp duty on the document, but once the document is brought to the notice of the authorities, the authorities are duty bound to impound that document and the original should not be given back to the concerning party without proper payment of stamp duty. In the present case also the petitioner/plaintiff has clearly stated that he has not relying upon the document i.e. agreement to sell and does not wish to get the document exhibited for which he has placed reliance upon the orders passed by this Court in the case of Manoj Shivhare Vs. Suni Kumar Khandelwal and others, W.P.No.8429/2012 decided on 9.11.2017 and and in the case of K.B. Jayaram (supra), but the fact remains that neither the Division Bench judgment nor the Full Bench judgment was brought to the notice of the Court at the time of passing of the aforesaid orders. In such circumstances, the order passed by the learned Trial Court is just and proper and the same does not call for any interference in the present writ petition. The document once brought to the notice of the authority if found to be insufficiently :: 19 :: M.P.No.2045/2018 (Mukesh Kumar Vs. Kulvinder Singh (dead) through its legal heirs Jaspreet Kaur and others) stamped has to be impounded and without payment of proper stamp duty the same cannot be returned back to the concerning person, despite of the fact that he has chosen not to place reliance upon the document and has chosen not to get the document exhibited before the Court below, even then it is the duty of the concerning authority of the Collector to impound and seize the document and impound it and the same should not be returned until and unless proper stamp duty is being paid in terms of Indian Stamp Act, 1899. (13) Accordingly, finding no illegality in the order passed by the learned Trial Court the writ petition sans merit and is hereby dismissed. No order as to costs.

(Vishal Mishra) Judge 10/03/2021 Pawar* ASHISH PAWAR 2021.03.16 10:46:34 +05'30'

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