Roopkishore Gupta vs Ramrani Alias Saroj on 20 August, 2019

[Cites 10, Cited by 3]

Madhya Pradesh High Court

Roopkishore Gupta vs Ramrani Alias Saroj on 20 August, 2019

By the instant petition, the petitioner is challenging the order dated 22.07.2019 (Annexure- P/5) passed by Second Additional Civil Judge, Class-I, District Damoh turning down the request made by the petitioner/plaintiff that the agreement dated 05.04.2014 needs to be impounded by the Collector of Stamp, Damoh and, therefore, requested the Court that the said document be referred for impounding by the Competent Authority.

The said application was replied and denied that the document which needs to be registered cannot be referred for impounding. The Court below rejected the application on the ground that at the time of filing the suit, the said document was filed and it was in the knowledge of the plaintiff that the document requires to be properly stamped and needs to be impounded by the Collector of Stamp but without doing so, request is being made at a belated stage, therefore, the same cannot be accepted and the said request of the plaintiff/petitioner was rejected by the Court below.

2 MP No.4140/2019

The learned counsel for the petitioner has relied upon a decision passed by this Court in Writ Petition No.10443/2013 parties being Premlal Jharia Vs. Smt. Mango Bai Mehra & ohters in which, this Court has observed as under:-

5. I find that the order of the learned Trial Court is not sustainable in law. The appropriate stamp duty can be paid at any time before any document insufficiently stamped is produced in evidence. The deficient stamp duty can be made up at any stage as the question of appropriate stamp duty is required to be examined when such document is produced in evidence. If the document is insufficiently stamped, then the document is required to be impounded.

Therefore, before such document is admitted, any deficiency in stamp duty can be made up. The delay is not relevant but the stage in which the document is produced is relevant. Before the document is tendered in evidence, the appropriate stamp duty has to be paid. The consequence of the insufficient stamp duty is impounding of document. Such stage of impounding will arise only when document is to be produced in evidence in terms of Section 33 of the Act.

6. The matter has been examined by the Supreme Court in a case reported as Chilakuri Gangulappa Vs. Revenue Divisional Officer, Madanpalle and another [(2001) 4 SCC 197], wherein the plaintiff sought enforcing of an agreement of sale of an immoveable property. Such agreement was found insufficiently stamped. The learned Court impounded it and forwarded the instrument to the Revenue Divisional Officer for the purpose of taking further action. The Revenue Divisional Officer found that the agreement of sale was deficient in stamp duty and imposed penalty. Such order was challenge by the plaintiff under Section 47-A of the Stamp Act. In the light of such facts, the Supreme Court found that Section 47-A of the Act would not be applicable as in case of deficient amount of stamp duty, it is section 38 of the Act, which would be applicable. The relevant extract of the judgment in Chilakuri Gangulappa (supra) is as under:-

11. We extracted the relevant sub-sections 3 MP No.4140/2019 of Section 47-A for the purpose of showing that the whole route followed hitherto was wrong as Section 47-A would not come into picture at all since nobody has a case that the instrument concerned was ever presented for registration. In the context of this instrument being presented before the Civil Court the relevant provision to be noticed is Section 40 of the Stamp Act. Sub-

section (1) of that Section says that when the Collector impounds an instrument under Section 33, or receives any instrument sent to him under Section 38(2) he shall adopt the procedure laid down in the sub-section. In this context Section 38 is to be looked into. It is extracted below:

38. Instruments impounded, how dealt with.- (1) When 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, 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.

12. It is clear from the first sub-section extracted above that the court has a power to admit the document in evidence if the party producing the same would pay the stamp duty together with a penalty amounting to ten times the deficiency of the stamp duty. When the court chooses to admit the document on compliance with such condition the court need forward only a copy of the document to the Collector, together with the amount collected from the party for taking adjudicatory steps. But if the party refuses to pay the amount aforesaid the Court has no other option except to impound the document and forward the same to the Collector. On receipt of the document through either of 4 MP No.4140/2019 the said avenues the Collector has to adjudicate on the question of the deficiency of the stamp duty. If the Collector is of the 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 of an amount not exceeding ten times the amount of the proper duty or of the deficient portion thereof".

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14. Inasmuch as none of the above proceedings had been adopted by any of the authorities including High Court we set aside the impugned orders. We direct the Munsif to consider first whether the document is insufficiently stamped and if he finds that question in the affirmative he has to adopt the next step indicated above.

7. Since the plaintiff in the present case admits that the document is insufficiently stamped, the learned Court had two options, first; to allow the plaintiff to make up the deficiency in the stamp duty and second; to impound and send the same to the Revenue Officer for recovery of stamp duty. But since the plaintiff was willing to pay the deficient amount of stamp duty, the Trial Court should have exercised the first option of calling upon the plaintiff to pay the amount of deficient stamp duty before the document is produced in evidence.

8. Consequently, the order passed by the Trial Court cannot be sustained in law. Thus, the same is set aside. The petitioner/plaintiff is permitted to make up the deficient stamp duty in terms of the provisions of the Indian Stamp Act, 1899 in accordance with law. However, it is clarified that payment of stamp duty is not proof of document. The document has to be proved in accordance with law.

Looking to the observation made by this Court and the law laid down in respect of the impounding the document, I am of the opinion that the order passed by the Court below which is impugned in this case is not sustainable as the same is contrary to law. However, impounding of the document and 5 MP No.4140/2019 payment of stamp duty is a matter of State concern and the private parties are not required to be heard but in the Court below since their reply has been considered by the Court below, therefore, they are required to be heard.

In view of the above, let notice be issued to the respondents on payment of process fee within a period of seven days by ordinary as well as RAD mode.

Notice be made returnable within four weeks.

(SANJAY DWIVEDI) JUDGE Devashish Digitally signed by DEVASHISH MISHRA Date: 2019.08.26 18:34:18 +05'30'

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Madhya Pradesh High Court