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Issues Involved:
1. Whether a copy of an instrument produced under Section 125 of the Companies Act is an instrument chargeable with duty under Section 7(1) read with Section 19 and Section 2 of the Bombay Stamp Act, 1958. 2. Whether the Collector and Assistant Superintendent of Stamps was right in impounding the copy of the instrument and ordering levy of duty and penalty under the provisions of Sections 33 and 39 of the Bombay Stamp Act, 1958. Detailed Analysis: Issue 1: Chargeability of a Copy of an Instrument under the Bombay Stamp Act The primary issue was whether a copy of an instrument produced under Section 125 of the Companies Act is chargeable with duty under Section 7(1) read with Section 19 and Section 2 of the Bombay Stamp Act, 1958. The court noted that the original instrument creating a charge, if received in Gujarat, would attract differential stamp duty representing the difference between the Gujarat rate and the Maharashtra rate, as per Sections 18 and 19 of the Stamp Act. Section 19 states that if an instrument executed outside the state and related to property situated in Gujarat is received in the state, it shall be charged with the differential duty. Section 7(1) extends this liability to copies of such instruments, stating that "the duty chargeable on an instrument of sale, mortgage or settlement other than a principal instrument or on a counterpart, duplicate or copy of any instrument shall, if the principal or original instrument would, when received in this State have been chargeable under this Act with a higher rate of duty, be the duty with which the principal or original instrument would have been chargeable under Section 19." The court concluded that even a copy of an instrument is liable to differential duty as the original instrument would be under Section 19. Therefore, the first question was answered in the affirmative, with the clarification that while a copy of the original instrument cannot be called an "instrument" within the meaning of the Act, such a copy would be liable to stamp duty under Section 7(1) read with Section 19 of the Act. Issue 2: Impounding of the Copy and Levy of Duty and Penalty The second issue was whether the Collector and Assistant Superintendent of Stamps was right in impounding the copy of the instrument and ordering the levy of duty and penalty under Sections 33 and 39 of the Bombay Stamp Act, 1958. The court examined the role of the Registrar of Companies, who is a public officer charged with the duty of discharging functions under the Companies Act, including the registration of charges created by a company. Section 33(1) mandates that every person in charge of a public office must impound an instrument not duly stamped if it comes before them in the performance of their functions. However, the court noted that the document in question was sent to the Collector by the Registrar of Companies, not produced before the Collector by the company. The court emphasized that the function of impounding a document must be located in a specific section of the Stamp Act, and in this case, it was not. The court further analyzed Section 39, which allows the Collector to require payment of proper duty and impose a penalty if an instrument is not duly stamped. The term "instrument" as defined in Section 2(1) includes every document by which any right or liability is created, transferred, limited, extended, extinguished, or recorded. However, the court held that a copy of such an instrument does not create or purport to create any right or liability; it merely records the original instrument's details. Thus, a copy does not fall within the definition of "instrument" under Section 2(1) for the purposes of Section 39. Consequently, the court held that while differential duty is payable under Section 7 read with Section 19 of the Stamp Act in respect of a copy of an instrument creating a charge, such a copy cannot be impounded, and neither the duty nor the penalty can be levied under the current provisions of the Stamp Act. The second question was therefore answered in the negative. Conclusion The court answered the questions as follows: 1. A copy of an instrument produced under Section 125 of the Companies Act is chargeable with duty under Section 7(1) read with Section 19 and Section 2 of the Bombay Stamp Act, 1958, with the clarification that such a copy would be liable to stamp duty but is not an "instrument" within the meaning of the Act. 2. The Collector and Assistant Superintendent of Stamps was not right in impounding the copy of the instrument and ordering the levy of duty and penalty under Sections 33 and 39 of the Bombay Stamp Act, 1958. The reference was answered accordingly, and parties were directed to bear their own costs. The court also refused a certificate of fitness to appeal to the Supreme Court, noting that no substantial question of law of general importance requiring a decision by the Supreme Court arose in this case.
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