1981 (1) TMI 293 - HC - Indian Laws

Summary

Issues Involved:
1. Admissibility of an insufficiently stamped and unregistered document.
2. Compliance with the Gram Panchayat Act regarding surcharge.
3. Use of an unregistered document for collateral purposes.
4. Impact of non-payment of surcharge on admissibility.

Issue-wise Detailed Analysis:

1. Admissibility of an Insufficiently Stamped and Unregistered Document:
The plaintiff sought to admit an exchange deed dated 14-6-1958 to prove possession of the disputed property. The Principal District Munsif refused to admit the document due to insufficient stamping and lack of registration. The court emphasized that under Section 35 of the Stamp Act, an instrument chargeable with duty must be stamped to be admissible in evidence. The proviso to Section 35 allows a document to be received in evidence upon payment of stamp duty and penalty if initially unstamped or insufficiently stamped. The court noted that the document in question had been impounded by the R.D.O., who imposed duty and penalty, and a certificate was appended confirming compliance with Section 35. Thus, the document satisfied the requirements of Section 35 and could be admitted for collateral purposes.

2. Compliance with the Gram Panchayat Act Regarding Surcharge:
The lower court refused to admit the document because the surcharge required by Sections 69 and 73 of the Gram Panchayat Act was not paid. It was undisputed that transactions involving immovable property under village panchayat jurisdiction require a 5% surcharge on the property's value. The court found that the R.D.O. did not collect this surcharge when impounding the document. The court held that the non-payment of surcharge under the Gram Panchayat Act does not fall under the provisions of Section 35 of the Stamp Act, which governs the admissibility of documents based on stamp duty and penalty.

3. Use of an Unregistered Document for Collateral Purposes:
The plaintiff argued that the document was tendered for collateral purposes, specifically to prove possession rather than title. The court acknowledged that under Section 49 of the Registration Act, an unregistered document can be received in evidence for collateral purposes if it complies with Section 35 of the Stamp Act. The court cited precedent where unregistered documents were admitted for collateral purposes, such as proving possession, in conformity with the proviso added by the Amendment Act of 1929 to Section 49 of the Registration Act.

4. Impact of Non-payment of Surcharge on Admissibility:
The court determined that the lower court's refusal to admit the document based on non-payment of surcharge was unjustified. The court noted that the Gram Panchayat Act and its relevant rules do not incorporate Section 35 of the Stamp Act concerning the duty on property transfers. The court referred to a Division Bench decision in Manavala Naicker v. K. R. Gopala, which dealt with a similar issue under the Madras District Municipalities Act. The court concluded that the legislature did not intend for the surcharge under the Gram Panchayat Act to affect the admissibility of documents under Section 35 of the Stamp Act. Consequently, the document could be admitted in evidence for the limited purpose for which it was tendered, despite the non-payment of surcharge.

Conclusion:
The court set aside the lower court's order and directed it to receive the document in evidence for the limited purpose of proving possession. The defendant retained the right to challenge the document's genuineness and raise other contentions. The Civil Revision Petition was allowed without costs.