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3. The Stamp Act consolidates the law relating to stamps in the State of Kerala. It provides for the instruments which are to be stamped, and the rate at which they are to be stamped. It also provides for the machinery to check the evasion of stamp duty. Chapter IV deals with such instruments not duly stamped and how they are to be dealt with. The first provision under Chapter IV provides that every person who has authority to receive evidence and every person in charge of a public office except police before whom any instrument chargeable with stamp duty is produced or brought to his notice for the purpose of his functions and if the same is not duly stamped, he may impound the same. The expression 'impound' only means taking possession of the document for being held in custody in accordance with law. Sub-section 2 of Section 33 provides that for the said purpose every such person shall examine every instrument so produced or coming before him, in order to ascertain whether it is stamped with proper stamp or not. It is the case of the petitioner herein that he did not rely on the document and he did not adduce the same as evidence. The document was not marked also by the court and hence the learned Tribunal erred in impounding the same, it is contended. Reference is invited to two decisions of this Court, one in Thoma Thomas v. Parameawaran Nair (1989(1) KLJ 16) and the other in Uthuppan Abrahan v. State of Kerala (1997 (2) KLT 475). In the former case, K.P. Radhakrishna Menon, J. has taken the view that merely because a document is produced before a court, unless it is tendered in evidence, the same cannot be impounded even if the document is insufficiently stamped, because only if the document comes before the court in the performance of the functions, then alone impounding is permissible. To quote, "The words in the Section that require special mention are "is produced or comes in the performance of his functions." The insufficiently stamped document in order to be impounded under Section 33 therefore must be one which had been produced or had come in the performance of the functions of the persons or authorities mentioned in the sub-section. The phrase "in the performance of his functions" in the context is meaningful. The document, in order to find that it has been produced or has come in the performance of the functions of the authority concerned, must be one, the party concerned had taken steps to tender in evidence. A mere production of the document cannot therefore be said to be a production within the meaning of that phrase, because the party who has produced the document, has every right to take the same back before steps to tender it formally in evidence are taken. To put it differently, mere production of the document in contra-distinction to tender the document in evidence is not sufficient to impound the document chargeable with duty, however insufficiently stamped. Investigation to decide the issue whether the document is liable to be impounded under Section 33 thus cannot be bad until it is tendered in evidence although the document had in the meantime been produced before the authority concerned."

In the latter case, C.S. Rajan, J. has taken the view that unless the document that is produced in court has either been proved in evidence or acted upon by any of the parties, the same cannot be impounded. To quote, "Only the document which is either relied on by the parties for proving the case or admitted in evidence by marking as Exhibit is liable to be impounded by the Court. Merely because a document was filed in Court (and when the same was not either proved in evidence or acted upon by any of the parties) the Munsiff cannot order impounding the document or imposing any penalty for insufficiency of the stamp duty. The principle seems to be that a party to the litigation cannot escape the liability of payment of the stamp duty under the law whenever he wants to rely on the document in order to prove his case."

5. The position as explained above in fact is not res integra. A Division Bench of this Court in Asokan v. Dy. Collector (1995(2) KLT 292), dealing with court's power to impound a document even when the parties are not before the court held that "whenever the infraction of the Act is detected primary liability of the executant of the instrument cannot be shelved for the reason that he never produced it before the Court. Court's power to impound an instrument cannot be denied on the ground that the parties to the instrument are not before the Court. From a reading of Section 33(1) it can be discerned that whenever an insufficiently stamped instrument comes to the notice of the Court, it can impound the same." It has been further held that "Section 33 makes the position clear that whenever a document is produced before the Court and when it appears to the Court that such an instrument is not duly stamped it can be impounded." Thus it is not necessary that the production of the document should be followed by marking the same as part of the evidence. It is also not necessary that only a document that is relied on by the authorities that can be impounded. The moment a document is produced in any proceedings before the court and if the court notices that the same is insufficiently stamped, the Court has a duty to impound the same. Such duty is part of the power provided under Section 33 to take steps for evading the stamp duty. Therefore, the decisions in Thoma Thomas's case (supra) and Uthuppan Abraham's case (supra) are no more good law in view of the Bench decision of this Court in Asokan's case (supra).

6. The next question is regarding the procedure. Section 34 makes it clear that only when an insufficiently stamped document is sought to be admitted in evidence, the Court is empowered to impose penalty for payment of a sum equal to 10 times such duty in addition to the deficient portion of the stamp. The Court while impounding an instrument shall send the original to the District Collector, as provided under Section 37(2). In other words, the documents impounded by the court on mere production of the same and when they are not relied on by the parties as part of evidence have to be forwarded to the District Collector for action under Section 39; only when an insufficiently stamped document is sought to be admitted in evidence, the court is empowered to realise the deficient portion and impose the penalty at ten times of such portion. The difference between Sections 34 and 39 in the matter of penalty is that a discretion is given to the Collector under Section 39 but not to the court under Section 34. In other words, if an insufficiently stamped instrument is to be admitted in evidence, it is permissible only if the deficiency is made up and ten times the deficient portion is paid as penalty. As far as the document that is mainly produced before the court when impounded and sent to the Collector under Section 37(2), the Collector has a discretion to realise the deficient portion together with a penalty of Rs. 5/- or if he thinks fit an amount not exceeding ten times the amount of the proper duty or deficient portion. In fact Chandrasekhara Menon, J. has considered this procedure in Chanda Pillai v. Munsiff, Thiruvalla and Ors. (1975 KLT 753). To quote from the judgment, "As long as an instrument is not admitted in evidence, the Munsiff though he may have impounded the same has no jurisdiction to levy any penalty or charge any duty on the same. The question whether the Munsiff should not under Sub-section (2) of Section 37 by which every person impounding an instrument has to send it in original to the Collector, depends upon the answer to the question whether the case is one which can come within the description of every other case mentioned therein. Every other case means every case other than the cases mentioned in Sub-section (1) of Section 37. Among cases mentioned therein is the case of a person impounding an instrument under Section 33 who has by law authority to receive evidence and admits such instrument in evidence upon payment of penalty as provided by the proviso to Section 34. It is only when the case is different from the one mentioned therein that an occasion will arise for a Civil Court to act under Sub-section 2. Ordinarily, the duty or power of assessing the amount of stamp duty or collecting stamp duty and penalties is invested by the Act in the Collector. The proviso to Section 34 invests courts with the special jurisdiction of adjudicating upon stamp duty and imposing penalty in certain cases and those are cases where a patty to a litigation before the court tenders a document in evidence. In the instant case, as the documents have not been admitted in evidence no question of imposition of stamp duty by the Munsiff arises. He could have acted only under Section 37(2) by which he is to send the documents to the Collector who then can proceed to stamp the instruments concerned and collect the required duty and penalty if any from the person or persons who are liable to pay the same."