2022 (3) TMI 1619 - HC - Indian Laws

Seeking waiver of payment of stamp duty in respect of the assets inherited by the various parties - seeking cancellation of the notice received from the Registry of the High Court of Delhi as also notice received from the Office of the Assistant Collector (Kalkaji) New Delhi - HELD THAT - The issue of registration of family settlements is no longer res integra. If an understanding has been arrived at between the parties previously and it is only written down in a document after the settlement has been arrived at the same would not require registration. This is the settled position of law as is clear from KALE VERSUS DEPUTY DIRECTOR OF CONSOLIDATION 1976 (1) TMI 172 - SUPREME COURT . The Division Bench of this Court has held in Nitin Jain v. Anuj Jain Anr. 2007 (4) TMI 785 - DELHI HIGH COURT that a memorandum recording an oral family settlement which has already taken place is not an instrument dividing or agreeing to divide property and is therefore not required to be stamped. Thus it is clear that family settlements are not required to be compulsorily registered and stamp duty is not required to be compulsorily paid in respect of the same when the settlement has been arrived at initially as an oral partition and is thereafter put into writing for the purpose of information. Considering the said position it is clarified that there is no requirement of valuation of the suit properties in the present case. The payment of stamp duty by the legal heirs of Late Sh. S.S. Walia and Dr. Urmila Walia shall stand waived. Notices issued by the various authorities shall also stand cancelled and withdrawn without any further orders. Decree sheet be drawn by the Registry within a period of eight weeks and compliance be reported.

Summary

Issues:
Application for waiver of stamp duty and cancellation of notices in a family settlement case.

Analysis:
The judgment concerns an application seeking waiver of stamp duty and cancellation of notices in a family settlement case involving assets inherited from deceased individuals. The suit for partition and other reliefs was filed by legal heirs of the deceased, leading to a settlement recorded in a 'Memorandum of Family Settlement and Arrangement.' The settlement was approved by the court, and the parties agreed to partition orally, with the terms reduced to writing for record-keeping. The main contention was the waiver of stamp duty and cancellation of notices related to valuation reports for calculating stamp duty.

The court highlighted that the family settlement, even when reduced to writing, does not require registration if the settlement was arrived at earlier and only documented later. Citing legal precedents, the court emphasized that a family settlement does not need registration if the terms are reduced to writing after the settlement. The court referred to the settled position of law regarding family settlements and the necessity of registration based on previous judgments.

Moreover, the court cited a Division Bench ruling that a memorandum recording an oral family settlement, which has already taken place, is not an instrument dividing or agreeing to divide property and thus not required to be stamped. The court clarified that oral family settlements, when documented later, do not create new rights but merely record existing agreements. Therefore, such memorandums do not attract stamp duty.

In conclusion, the court held that family settlements do not require compulsory registration or payment of stamp duty when initially agreed upon orally and later documented for record-keeping purposes. The court waived the stamp duty payment by the legal heirs and canceled the notices issued by various authorities. The decree sheet was directed to be drawn by the Registry within a specified period, and the application was disposed of accordingly.