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2008 (12) TMI 767 - SC - Indian LawsInterpretation of Statute - Sections 33 and 35 of the Indian Stamp Act 1899 - suit filed for recovery - document was admissible for collateral purpose or not. HELD THAT - Indisputably an instrument was executed. By reason of such an instrument not only the entire amount of consideration was paid but possession of the property had also been transferred - The explanation has been inserted by M.P. Act 19 of 1989. By reason of the said provision, thus, a legal fiction has been created. Although ordinarily an agreement to sell would not be subject to payment of stamp duty which is payable on a sale deed, but having regard to the purpose and object it seeks to achieve the legislature thought it necessary to levy stamp duty on an instrument whereby possession has been transferred. We have noticed hereinbefore that Section 33 of the Act casts a statutory obligation on all the authorities to impound a document. The court being an authority to receive a document in evidence is bound to give effect thereto. The unregistered deed of sale was an instrument which required payment of the stamp duty applicable to a deed of conveyance. Adequate stamp duty admittedly was not paid. The court, therefore, was empowered to pass an order in terms of Section 35 of the Act. The contention of ld counsel for the appellant that the document was admissible for collateral purpose, in our opinion, is not correct. Section 35 of the Act, however, rules out applicability of such provision as it is categorically provided therein that a document of this nature shall not be admitted for any purpose whatsoever. If all purposes for which the document is sought to be brought in evidence are excluded, we fail to see any reason as to how the document would be admissible for collateral purposes. The view we have taken finds support from the decision of the Privy Council in Ram Rattan v. Parmananad 1945 (12) TMI 5 - PRIVY COUNCIL where it was held that That the words for any purpose in Section 35 of the Stamp Act should be given their natural meaning and effect and would include a collateral purpose and that an unstamped partition deed cannot be used to corroborate the oral evidence for the purpose of determining even the factum of partition as distinct from its terms. For the reasons aforementioned, there is no merit in this appeal which fails and is dismissed. However, in the facts and circumstances of the case, there shall be no order as to costs.
Issues Involved:
1. Interpretation of Sections 33 and 35 of the Indian Stamp Act, 1899. 2. Applicability of the Indian Registration Act, 1908. 3. Validity and admissibility of an unregistered deed of sale. 4. Stamp duty and penalty on an instrument deemed to be a conveyance. Issue-wise Detailed Analysis: 1. Interpretation of Sections 33 and 35 of the Indian Stamp Act, 1899: The Supreme Court examined the interpretation of Sections 33 and 35 of the Indian Stamp Act, 1899. Section 33 mandates that any person authorized to receive evidence or in charge of a public office must impound an instrument not duly stamped. Section 35 stipulates that such an instrument is inadmissible in evidence for any purpose unless the required stamp duty and penalty are paid. The Court emphasized that the purpose for which a document is sought to be admitted in evidence is irrelevant under Section 35, which uses the phrase "for any purpose whatsoever," indicating a broad application. 2. Applicability of the Indian Registration Act, 1908: The appellant argued that the unregistered deed of sale should be admissible for collateral purposes based on the proviso to Section 49 of the Indian Registration Act, 1908. However, the Court clarified that Section 35 of the Stamp Act overrides this provision, ruling out the admissibility of an unstamped instrument for any purpose, including collateral purposes. The Court referred to the decision in Bondar Singh v. Nihal Singh, where the interpretation of the Registration Act was in question, not the Stamp Act. 3. Validity and Admissibility of an Unregistered Deed of Sale: The Court held that the unregistered deed of sale, which required payment of stamp duty applicable to a deed of conveyance, was inadmissible in evidence due to inadequate stamp duty. The Court noted that the document was not admissible for any purpose, including collateral purposes, as per Section 35 of the Stamp Act. The Court referenced the Privy Council decision in Ram Rattan v. Parmananad, which held that the words "for any purpose" in Section 35 include collateral purposes. 4. Stamp Duty and Penalty on an Instrument Deemed to Be a Conveyance: The Court discussed the explanation appended to Article 23 of Schedule IA of the Stamp Act, as substituted by M.P. Act No. 19 of 1989, which creates a legal fiction deeming an agreement to sell immovable property as a conveyance if possession is transferred. The Court noted that the appellant had taken possession of the property, making the agreement subject to stamp duty as a conveyance. The Court upheld the Additional District Judge's order to impound the document and impose a penalty for insufficient stamp duty. Conclusion: The Supreme Court dismissed the appeal, affirming the lower court's decision to impound the unregistered deed of sale and impose a penalty for insufficient stamp duty. The Court reiterated that an unstamped instrument is inadmissible in evidence for any purpose, including collateral purposes, under Section 35 of the Indian Stamp Act, 1899. The appellant's reliance on the Indian Registration Act, 1908, was deemed inapplicable in the context of the Stamp Act's provisions.
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