1977 (11) TMI 117 - HC - Companies Law

Issues Involved:
1. Jurisdiction and legality of the orders passed by the Collector of Stamps and Chief Controlling Revenue Authority.
2. Whether Form 3 filed under Section 75 of the Companies Act constitutes a conveyance deed or an agreement to sell.
3. Applicability of stamp duty on Form 3 under the Indian Stamp Act.
4. Preliminary objection regarding the maintainability of the writ petition.

Issue-wise Detailed Analysis:

1. Jurisdiction and Legality of the Orders:
The petitioner challenged the orders passed by the Collector of Stamps and the Chief Controlling Revenue Authority, arguing that they were against the law and beyond the jurisdiction of the authorities. The petitioner contended that the particulars filed under Section 75 of the Companies Act did not amount to a sale deed but could only be deemed an agreement to sell, as the property could not be conveyed without a registered sale deed. The respondents, however, maintained that the orders were in accordance with the law and that the petitioner was liable to pay stamp duty on Form 3, which constituted a deed of conveyance.

2. Form 3 Constituting a Conveyance Deed or Agreement to Sell:
The court examined the relevant provisions of Section 75 of the Companies Act, which requires companies to file a return of allotments and produce a contract in writing constituting the title of the allottee to the shares allotted. If no written contract exists, the company must file the prescribed particulars of the contract, which are deemed to be an instrument within the meaning of the Indian Stamp Act. In this case, the petitioner allotted shares in consideration of the assets and liabilities of Sudarshan Talkies, and the particulars were furnished in Form 3. The court concluded that Form 3 provided particulars of a conveyance deed rather than an agreement to sell, as it detailed the property and the manner in which the purchase price was satisfied.

3. Applicability of Stamp Duty on Form 3:
The court held that the particulars furnished in Form 3 constituted an instrument within the meaning of the Stamp Act and were required to be stamped with the same duty as if the contract had been reduced to writing. The court emphasized that the title to the allotment of shares could only be constituted by a contract, and the particulars in Form 3 were in respect of the oral contract between the parties. Therefore, the form furnishing the particulars had to be treated as the contract in writing for the purposes of stamp duty.

4. Preliminary Objection Regarding Maintainability:
The respondents raised a preliminary objection, arguing that the petitioner was not entitled to maintain the writ petition as they had already availed of their remedy under Section 57 of the Stamp Act. The court dismissed this objection, stating that the petitioner could have filed a petition for mandamus to compel the Chief Controlling Revenue Authority to refer the other questions. The court decided to proceed with the merits of the case, noting that the application raised substantial questions of law, and the authority was bound to state the case under Section 57(1) of the Stamp Act.

In conclusion, the court dismissed the writ petition, upholding the orders of the Collector of Stamps and the Chief Controlling Revenue Authority. The court found that the particulars filed in Form 3 were rightly considered as a conveyance deed and attracted stamp duty accordingly. The parties were directed to bear their respective costs.

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