Delhi High Court - Orders
Namita Sharma & Anr vs Jag Mohan Ahuja & Ors on 3 November, 2022
Author: Anup Jairam Bhambhani
Bench: Anup Jairam Bhambhani
$~11
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ CS(OS) 243/2019
NAMITA SHARMA & ANR. ..... Plaintiffs
Through: Mr. Anshul Mittal & Mr. Kshitij
Mittal, Advocates.
versus
JAG MOHAN AHUJA & ORS. ..... Defendants
Through: Mr. Rajneesh Sood & Mr. Gurpreet
Singh, Advocates for D-1, 9 & 10.
CORAM:
HON'BLE MR. JUSTICE ANUP JAIRAM BHAMBHANI
ORDER
% 03.11.2022 I.A. 540/2020 (under section 33/38/40 of the Indian Stamp Act, 1899) By way of this application filed under sections 33, 38 and 40 of the Indian Stamp Act, 1899, the plaintiffs seek impoundment of Property Development Agreement dated 06.04.2018 ('PDA' for short) and imposition of penalty for alleged under-stamping of the document purportedly executed between defendants Nos. 1, 9 and 10. Mr. Anshul Mittal, learned counsel for the plaintiffs has strenuously argued that by way of the PDA, Shri Jag Mohan Ahuja, defendant No.1, has transferred and conveyed title to two floors, being the ground floor and first floor, of property bearing No. E - 285, Naraina Vihar, New Delhi in favour of defendants Nos. 9 and 10, Shri Shoti Purshotam Gera and Shri Ravit Gera. To substantiate his submissions Mr. Mittal has drawn attention to clauses 13 and 14 of the PDA which read as under:
Signature Not Verified Digitally Signed By:DIVYA SHARMA CS(OS) 243/2019 Page 1 of 11 Signing Date:03.11.2022 19:12:05"13. That the First Party above named shall be the sole and exclusive owner of the built up Entire Second Floor, and Entire Third Floor, measuring 250.9 Sq Mts (each), with exclusive terrace roof rights, along with half share of parking at stilt area (below ground floor) out of freehold property bearing No. E-285, alongwith proportionate undivided, indivisible and impartiable ownership rights of the underneath land of the said property, with super structure, in Block E, situated at NARAINA VIHAR, New Delhi- 110028;
14. That the Second Party/Builder shall retain built up Entire Ground Floor, and Entire First Floor, measuring 250.9 Sq Mts (each), without terrace roof rights, along with half share of parking at stilt area (below ground floor) out of freehold property bearing No.E-285, alongwith proportionate undivided, indivisible and impartiable ownership rights of the underneath land of the said property, with super structure, in Block E, situated at NARIANA VIHAR, New Delhi-110028 with ownership rights and all rights for transfer/sale of the said floor and the Second Party will be fully entitled for the sale of his share."
(emphasis supplied)
2. Although from para 4 of the application it appears to be the plaintiffs' case that defendants Nos. 1, 9 and 10 have executed the PDA on 'NIL' value stamp paper, the petitioners also state in the same paragraph that the said defendants have paid stamp duty and registration fee "only for the 1/3rd share of defendant No. 1 in the property".
3. Be that as it may, Mr. Mittal's submission is restricted to the assertion that since the PDA amounted to defendant No. 1 transferring and conveying title to the ground floor and the first floor of the subject property unto defendants Nos. 9 and 10, the said document was liable Signature Not Verified Digitally Signed By:DIVYA SHARMA CS(OS) 243/2019 Page 2 of 11 Signing Date:03.11.2022 19:12:05 to be stamped ad-valorem on the value of the share in the property transferred thereby.
4. Based on the said allegation, Mr. Mittal submits that the PDA is liable to be impounded by the court and sent to the Collector of Stamps as per sections 33, 38 and 40 of the Indian Stamp Act. The relevant portions of sections 33 and 38 of the Indian Stamp Act, read 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 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 public offices.
***** Signature Not Verified Digitally Signed By:DIVYA SHARMA CS(OS) 243/2019 Page 3 of 11 Signing Date:03.11.2022 19:12:05
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, 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."
5. Disputing the very basis of the assertion made on behalf of the plaintiffs, Mr. Rajneesh Sood, learned counsel for defendants Nos. 1, 9 and 10 submits that on a plain reading of the provisions thereof, it is evident that the PDA is simply an agreement between defendant No. 1 on the one hand and defendants Nos. 9 and 10 on the other, for reconstruction and re-development of property No. E - 285, Naraina Vihar, New Delhi; which contemplates that in consideration of incurring the costs for such reconstruction and redevelopment, the builders, viz. defendants Nos. 9 and 10, shall be entitled to receive the title and ownership of the ground floor and first floor of the newly constructed property. Attention in this behalf is invited to clauses 9, 14-A and 32 of the PDA, which read as under:
"9. That the stamp duty and other expenses for the execution of the sale deed/(s) and transfer charges of any authority pertaining to the share of the Second Party shall be paid by him or by the either party or his/her/their prospective purchasers etc. And the partition of the aforesaid property into the respective floors of the first party and Second party shall be paid by first party and Second Party equally.
***** 14-A. That the total bargaining has been settled between both the parties for a sum of Rs. 1,10,00,000/- (Rs. One Crore and Ten Lakhs Signature Not Verified Digitally Signed By:DIVYA SHARMA CS(OS) 243/2019 Page 4 of 11 Signing Date:03.11.2022 19:12:05 Only) out of which Rs. 75,24,000/- (Rs. Seventy Five Lakhs and Twenty Four Thousand Only) has been received by the First Party from the Second Party at the time of signing of this Deed after deducting Rs. 76,000/- TDS (as applicable) and the balance sum of Rs. 34,00,000/- (Rs. Thirty Four Lakhs Only) which will be received by the First Party from the Second Party at the time of proper registered Sale Deed in respect of 1/3rd undivided share of built up aforesaid entire freehold property, before Sub-Registrar, New Delhi on or before 04/04/2018 after deducting TDS as applicable. That the stamp duty and registration tax shall be paid by the Second Party at his own cost and expenses.
***** 32 That the first party and Second Party shall execute proper registered Partition Deed in respect of the aforesaid floor allocated to each party as per the collaboration Agreement at the time of laying of marble Stone of the aforesaid property on or before 31.12.2018. And after the partition Deed each floor shall have their 1/4thundivided share in the underneath land of the said entire property."
(emphasis supplied)
6. Upon a careful perusal and consideration of the documents on record, in particular the provisions and covenants contained in the PDA, and on a proper appreciation of the submissions made by counsel, it is noticed that there is no covenant or clause in the PDA that purports or operates to transfer or convey the title, in or to, the ground floor or first floor of the subject property in favour of defendants No. 9 and 10 in-praesenti by way of the PDA. Clause 32 read with clause 9 makes it clear that the actual transfer of title in respect of the ground floor and first floor of the subject property is yet to be effected by defendant No. 1 in favour of defendants Nos. 9 and/or 10 at a subsequent stage/time; at which stage, the parties have covenanted that requisite stamp duty shall be paid in the execution of the sale Signature Not Verified Digitally Signed By:DIVYA SHARMA CS(OS) 243/2019 Page 5 of 11 Signing Date:03.11.2022 19:12:05 deed(s) and transfer charges payable to any authority in respect of the share to be transferred to defendants Nos. 9 and 10.
7. It is evident that the PDA is a classic, template collaboration agreement between defendant No. 1 (the owner/co-owner of the property) and defendants Nos. 9 and 10 (who are builders), to redevelop and re-construct the property, which has been agreed to be constructed at the cost and expense of the builders. In lieu of such redevelopment and reconstruction, the builder is entitled to receive a certain portion of the newly constructed building. In the present case, it would appear, the agreement between defendant No. 1 on the one hand and defendants Nos. 9 and 10 on the other, is that the builder would pay to the owner a certain sum of money and also incur all costs and expenses for construction of the new building; and in return the builder would receive title to, or the right to sell the ground floor and first floor of the newly constructed building alongwith a share in ownership of the land beneath, which the builder is then entitled to transfer onward.
8. For purposes of the present application, suffice it to say that the PDA in itself is not a transfer or conveyance of title in any portion or share of the subject property to defendants Nos. 9 and 10. The PDA is a mere agreement to effect such transfer subsequently; and accordingly, the PDA is required to be stamped as an 'Agreement or Memorandum of an Agreement' under Article 5(c) of Schedule IA to the Indian Stamp Act, 1899 as applicable to Delhi, for which the appropriate stamp duty is Rs.50/- which reads as under:
Signature Not Verified Digitally Signed By:DIVYA SHARMA CS(OS) 243/2019 Page 6 of 11 Signing Date:03.11.2022 19:12:05"5. AGREEMENT OR MEMORANDUM OF AN AGREEMENT-
****
(c) if not otherwise provided for. Fifty rupees."
9. It is seen that the PDA has been stamped at Rs. 50/-, which is accordingly the proper stamp duty payable under Article 5(c) of Schedule IA, as aforesaid.
10. In view of the above, there is no merit in the present application, and the same is accordingly dismissed.
I.A.15539/2019 (under Order XXXIX Rule 4 CPC)
11. By way of the present application filed by defendant No. 1 under Order XXXIX Rule 4 read with section 151 of the Code of Civil Procedure, 1908, the said defendant seeks modification of interim orders dated 06.05.2019 and 04.07.2019 made in I.A. No. 6600/2019 under Order XXXIX Rules 1 and 2 CPC, the relevant portion of which orders read as under:
Order dated 06.05.2019 "10. 1/3rd of the residential property at Naraina Vihar has already been sold to Defendant Nos.9 & 10 and hence there is an apprehension that further sale may also be made. Issue notices in the application to the Defendants in respect of the residential property, if Defendant No.1 intends to sell any portion of the share in the residential property in Naraina Vihar, he shall seek prior permission of this Court."
Order dated 04.07.2019 "10. As per the property development agreement entered into by Defendant No.1 with Defendant Nos.9 & 10, broadly, the upper ground floor and first floor have gone to the builder and second and third floors with roof rights have fallen to the share of Defendant No.1. In view of the fact that the other floors have been already sold to the builder and the Defendant no.1 prima facie has a Perpetual lease and a Conveyance deed executed in his favour, it is clarified Signature Not Verified Digitally Signed By:DIVYA SHARMA CS(OS) 243/2019 Page 7 of 11 Signing Date:03.11.2022 19:12:05 that Defendant No.1 shall stand restrained from creating any third party interest in respect of only his share in the suit property as per clause 13 i.e., Second floor and Third floor with terrace roof rights of the property bearing No.E-285, Naraina Vihar, New Delhi-
110028. The possession of the property shall also not be parted with by Defendant No.1 without permission of this Court. This order shall, however, not hinder Defendant No.1 from renting/leasing out his share in the suit property."
12. Mr. Rajneesh Sood, learned counsel for defendant No. 1 submits, that as is seen from a combined reading of orders dated 06.05.2019 and 04.07.2019, the restraint order was subsequently modified and restricted only to the second floor and third floor with roof rights of property bearing No E-285, Naraina Vihar, New Delhi, thereby limiting such order only to the portion falling to the share of defendant No. 1 in that property. Furthermore, in order dated 04.07.2019 this court has also recorded that if defendant No. 1 was desirous of parting with possession of the said portions of the subject property, defendant No. 1 could not to do so without prior permission of the court.
13. It is submitted that defendant No. 1 now wishes to sell the second floor of the subject property, for which he has potential third-party buyers. It is further submitted, that being a senior citizen defendant No. 1 needs financial resources to complete the interiors and furnishing of the third floor of the subject property, into which he intends to move from his current rented accommodation. Defendant No. 1 also requires money to buy an office/shop for his son to be able to undertake commercial activity. It is submitted that for all these reasons, defendant No. 1 needs to sell the second floor on an urgent Signature Not Verified Digitally Signed By:DIVYA SHARMA CS(OS) 243/2019 Page 8 of 11 Signing Date:03.11.2022 19:12:05 basis. It is also submitted on behalf of defendant No. 1, that he would continue to remain the owner in possession of the third floor of the subject property alongwith roof rights, which portion would be more than sufficient to satisfy the plaintiffs' claim for partition, even if the plaintiffs were to succeed. It is specifically assured that defendant No. 1 would continue to retain the third floor alongwith roof rights of the subject property till the disposal of the present suit.
14. In this backdrop, by way of the present application it is prayed that interim order dated 04.07.2019 be further modified, permitting defendant No. 1 to sell the second floor of the subject property to a third party.
15. The application is opposed on behalf of the plaintiffs on the ground that the entire property bearing No. E - 285, Naraina Vihar, New Delhi had been purchased from joint family funds; and that accordingly, defendant No. 1 is not entitled to deal with any portion of that property, even after redevelopment and reconstruction, until disposal of the present suit.
16. Mr. Sood rebuts this contention, drawing attention to perpetual lease deed dated 10.03.1967 whereby the subject property bearing No. E - 285, Naraina Vihar, New Delhi was purchased on lease-hold basis from the Delhi Administration (Land and Housing Department), to show that the said perpetual lease was granted in the sole and exclusive name of defendant No. 1 way back in 1967. It is pointed-out that subsequently, defendant No. 1 also got the subject property converted from 'lease-hold' to 'free-hold' vide Conveyance Deed dated 23.04.2002 executed by the Delhi Development Authority, Signature Not Verified Digitally Signed By:DIVYA SHARMA CS(OS) 243/2019 Page 9 of 11 Signing Date:03.11.2022 19:12:05 again in the sole name of defendant No. 1, whereby free-hold title to the subject property was conveyed in favour of defendant No. 1. It is argued therefore, that from 1967 defendant No. 1 has been the sole and absolute owner of the subject property, initially on 'lease-hold' and subsequently on 'free-hold' basis, which property was purchased by defendant No. 1 from some monies borrowed from his sisters. It is further stated that no part of the consideration for acquiring the subject property was ever received from any joint family funds. It is pointed-out that the plaintiffs have produced no evidence whatsoever to support the allegation that the subject property was purchased from any joint family money.
17. There is no cavil with the position that perpetual lease deed dated 10.03.1967 and conveyance deed dated 23.04.2002, both of which are registered documents executed by governmental authorities, operate to transfer rights to the subject property solely in the name of defendant No. 1. In fact, it is noticed that the plaintiffs' father Sh. Daulat Ram Ahuja was one of the witnesses to the perpetual lease.
18. This court is also conscious that, at this stage, the present application must be decided only on a prima-facie consideration of the averments and the documents on record; and defendant No 1's name clearly appears as the sole owner in registered documents relating to lease- hold/free-hold title to the subject property, viz. in the perpetual lease and the conveyance deed. It cannot therefore possibly be said that prima facie the case is not in favour of defendant No. 1 as regards the ownership of the subject property.
Signature Not Verified Digitally Signed By:DIVYA SHARMA CS(OS) 243/2019 Page 10 of 11 Signing Date:03.11.2022 19:12:0519. Moreover, if upon conclusion of the trial, it is found that the plaintiffs also had some right, title or interest in the subject property, defendant No. 1 is also ready and willing to undertake to retain ownership of the third floor along with roof rights of the subject property with himself, until conclusion of the proceedings in the suit.
20. Upon a conspectus of the foregoing, in the opinion of this court, the present application deserves to be allowed.
21. Accordingly, order dated 04.07.2019 is modified to the extent only of permitting defendant No. 1 to sell, transfer or convey and part with possession of the second floor of property bearing No. E - 285, Naraina Vihar, New Delhi to any third party; while restraining defendant No. 1 from transferring, alienating or creating any third party right, title or interest in or to the third floor with roof rights of the subject property; making it clear that as undertaken by defendant No. 1, he shall retain ownership and possession of the third floor with roof rights with himself till conclusion of the present suit or until this order is modified.
22. The application is allowed and order dated 04.07.2019 is modified in the above terms.
CS(OS) 243/2019
23. Learned counsel appearing for the parties submit that issues are required to be framed in the matter.
24. Let proposed issues be presented before court on the next date.
25. Re-notify on 08th February 2023.
ANUP JAIRAM BHAMBHANI, J.
NOVEMBER 3, 2022/uj Signature Not Verified Digitally Signed By:DIVYA SHARMA CS(OS) 243/2019 Page 11 of 11 Signing Date:03.11.2022 19:12:05