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TMI Blog2020 (5) TMI 741X X X X Extracts X X X X X X X X Extracts X X X X ..... cise nature of the rights created by means of the instrument. It further held that where two parties are co-owners, with a title which cannot be demarcated or fixed and there is joint possession and commonality of title, the documents transferring/releasing the title by one of the co-owners to the other would be a document of release. It further rejected the argument that a releaser cannot validly state in the instrument that he is effacing his rights in the property in favour of another named individual. A reading of Recitals and Covenants/warranties would clearly show that the Relinquishment Deeds were indeed documents of conveyance and not Release simplicitor - By the order dated 15.05.2013, the respondent no. 2, apart from claiming the deficient Stamp Duty, has imposed a penalty of Rs. 1 lakh on the petitioner. The order does not give any reason for imposition of such penalty and its amount. It is noted that the deceased late Shri Jagdish Prashad Sharma is claimed to have left behind his Will bequeathing his share in the property to the petitioner. The Relinquishment Deeds have also been executed by the sisters in favour of the petitioner. Therefore, an intent to evade Stamp Du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... linquishment Deeds (five in number; three dated 06.07.2012 and two dated 17.07.2012) are liable to be stamped under Article 33 of the Act. 6. The petition further challenges the order dated 15.05.2013 passed by the respondent no. 2 assessing the Stamp Duty payable on the said Relinquishment Deeds at Rs. 6,60,257/- and further imposing a penalty of Rs. 1,00,000/- on the petitioner. 7. The property was purchased by the parents of the petitioner, late Shri Jagdish Prashad Sharma and Smt. Shanti Devi, vide a registered Sale Deed dated 10.07.1972. 8. The petitioner claims that late Shri Jagdish Prashad Sharma bequeathed his half share in the property in favour of the petitioner by way of a Will registered on 24.09.2001. 9. Late Shri Jagdish Prashad Sharma expired on 31.10.2003, leaving behind his wife, the petitioner and his five daughters as the only Class I heirs. 10. The three sisters of the petitioner executed three separate Relinquishment Deeds in favour of the petitioner on 03.07.2012 relinquishing their share in the property in favour of the petitioner. The remaining two sisters relinquished their share in the property in favour of the petitioner by way of two separate Relinquish ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rument falls within the definition of conveyance under Art. 19 of Schedule I-A of the Stamp Act. We are of opinion that it does not. The document proceeds on the footing that the five persons, namely, the three executants and the two persons in whose favour the instrument was executed, who were carrying on business of that firm owned the property as co-owners, the executants being entitled to a three-fifths share and the other two being entitled to the remaining two-fifths share. It is not the case of any one that there was a division of the property by metes and bounds and in accordance with the said shares. In such circumstances the document in and by which the co-owner purports to abandon or relinquish his claim to the share to which he would be entitled would be in the nature of a release within Article 44. In such a case there need be no conveyance as such by one of the co-owners in favour of the other co-owners. Each co-owner in theory is entitled to enjoy the entire property in part and in whole. It is not therefore necessary for one of the co-owners to convey his interest to the other co-owner. It is sufficient if he releases his interest. The result of such release would b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rring/releasing the title by one of the co-owners to the other would be a document of release. It further rejected the argument that a releaser cannot validly state in the instrument that he is effacing his rights in the property in favour of another named individual. 20. The Full Bench of the Allahabad High Court in Balwant Kaur and Ors. v. State of U.P., MANU/UP/0168/1984, was considering a document whereby two daughters of the deceased owner of the property sought to release their share in the property in favour of the wife and son of the deceased, who were the only other legal heirs of the deceased. Relying upon the judgment of the Madras High Court in V.M. Murugesa Mudaliar of Gudiyatham (supra), the Court rejected the argument that under the law it was not open to a co-owner to renounce his right in favour of another co-owner. The Court further held as under: 16. It is thus clear that under the law it is open to a person holding property as a tenant-in-common to execute a release deed in favour of the other co-owner renouncing his claim to interest in the unpartitioned property and for this purpose it is not necessary for him to execute a deed of conveyance. Accordingly, wher ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly renounced his claim in favour of another co-sharer in respect of the same agricultural land, the document in question would be release deed and not a gift deed. (Vide State of Rajasthan Versus Alokik Jain). 23. To distinguish between a release deed, or a gift deed or a sale deed, the decisive factor is the actual character of the transaction and precise nature of the rights created by the instrument. In the case of co-owners each co-owner is in theory entitled to enjoy the entire property in part or in whole. It is not therefore necessary for one of the co-owners to convey his interest to the other co-owner. It is sufficient if he released his interest. The result of such a release would be the enlargement of the share of the other co-owner. The result of such a release should be the enlargement of the share of the other co-owner. A release can only feed title and cannot transfer title. (Vide Kuppuswami Versus Arumugam, and Kuppuswami Chettiar v. S.P.A. Arumugam Chettiar). 24. A document under which a Hindu coparcener purports to give up his right to the family property in favour of the remaining coparcener would not be a deed of conveyance but a deed of release. There is no dif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... only in a case where the release deed is gratuitous it operates as a valid release deed. A document of release may be validly executed even if it recites some benefit to the executant simultaneously with the act of release. In our view, the fact that the document contained words like ' consideration ' and ' transfer ' do not affect the substantial or true character of the transaction. The designation given to the document is that it is a release deed, though by itself is not decisive of the character of the transaction. The contents of the document, the intendment of the parties as can be seen from the document and the joint nature of acquisition by both the parties and the mode of enjoyment are all decisive of the fact that the document in question evidences a transaction by way of release of the interest of the executant in favour of the release, the parties to the transaction being co-owners. 23. The Full Bench of the Andhra Pradesh High Court in Kothuri Venkata Subba Rao and Ors. v. District Registrar of Assurances, Guntur, AIR 1986 Andhra Pradesh 42, while considering the case whereby four of the ten persons who had jointly purchased two plots of land for const ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rinciple will be defeated if the relinquishment is made in favour of one or a few named co-owners from out of the several co owners. 28. Judged from this view, the rulings in Chief Controlling Revenue Authority v. Patel for the ruling in Balwant Kaur v. State are not in conflict with the decision of Rajamannar, C.J., in Board of Revenue v. Murugesa, as in both the cases, there is enlargement of the shares of the co-owners and a particular co-owner from out of the several co-owners is not preferred, while making relinquishments. 29. Even the Full Bench of this Court in R.C. No. 83/70 dt. 18-1-1974 also took the view that inasmuch as the release was only in favour of the son of the deceased but not in favour of all the co-owners having rights and interests in the property, the deed was not found to be a deed of release but it is only a deed of conveyance as it was supported by consideration also. That ruling of this Court is again consistent with the proposition laid down by Rajamannar, C.J., in Board of Revenue v. Murugesa (FB) that it is sufficient if one of the co-owners releases his interest and it is not necessary for one of the co-owners to convey his interest to the other co-o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ach of the co-owners executed separate deed conveying 1/10th share in favour of a few but not in favour of all will clearly establish that the instruments are not the deeds of release but they are deeds of conveyance. 24. In Maddula Girish Kumar and Anr. v. The Commissioner of Survey, Settlements and Land Records and Anr., 1993 (1) APLJ 79, another Full Bench of the Andhra Pradesh High Court, while considering a case where two identical documents were executed by the mother on behalf of two minor sons relinquishing the share in the property in favour of the father, held as under: 12. In the case on hand, the question is whether the two documents executed by the two coparceners in favour of the remaining coparcener are release deeds or deeds of conveyance. The preponderance of judicial opinion, which we have referred to above, is that it only comes under release, but not a conveyance. Therefore, we agree with the contention of the learned counsel for the petitioners that the documents dated 12th October, 1974 executed by the petitioners in favour of their father are only documents of release. 25. In G. Subbalakshmi Visweswara Rao v. Secretary to Government, Revenue Department Ors. a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no basis in law for the proposition that if the Relinquishment Deed is executed in favour of one of the co-owners, it would be treated as a Gift Deed. The law of stamp duty as applicable in Delhi treats Relinquishment Deed and Gift Deed as separate documents, chargeable with different stamp duties. It is not necessary that in order to qualify as a Relinquishment Deed the document must purport to relinquish the share of the relinquisher in favour of all the remaining co-owners of the property. Even if the relinquishment is in favour of one of the co-owners it would qualify as a Relinquishment Deed. 28. It is important to note that in the said judgment, this Court did not consider the earlier judgments, including the ones referred hereinabove, in reaching the above conclusion. 29. In Hari Kapoor v. South Delhi Municipal Corporation, MANU/DE/3800/2019, the Court was considering a Deed of Release executed by one of the co-owner in favour of the other. This Court reiterated that the Deed of Release is an instrument by which one co-owner releases his interest in a specified property as a result of which there would be an enlargement of the share of the other co-owners. The releasee shoul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Andhra Pradesh High Court in Kothuri Venkata Subba Rao (supra), the learned counsel for the respondents submits that as five distinct Relinquishment Deeds were signed; three on 06.07.2012 and two on 17.07.2012, the same have to be treated as Gift Deeds, I cannot agree with the said submission. In the present case, the five documents, in fact, form part of one single transaction whereby the sisters have relinquished their shares in the property in favour of the brother. Merely because these documents are executed on different dates, cannot by itself be a determinative factor. It would always depend on facts of each case as to whether merely because the documents are executed separately, they have to be treated as separate transactions or part of one whole. In Kothuri Venkata Subba Rao (supra), the Andhra Pradesh High Court no doubt put emphasis on the separate execution of the Relinquishment Deeds by four of the co-owners, it also placed reliance on the recital of the documents to hold that the same were executed for giving warranty of title by the executants and were, therefore, not Release Deeds. 34. Having held the above, the documents in question still do not satisfy the test o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her is free from all sorts of encumbrances such as prior sale gift mortgage, litigation and disputes, stay order and attachment surety and security etc, etc and if this facts is found otherwise then the RELEASOR will be liable and responsible to indemnify the loss thus suffered by the RELEASEE. 36. A reading of above Recitals and Covenants/warranties would clearly show that the Relinquishment Deeds were indeed documents of conveyance and not Release simplicitor. 37. By the order dated 15.05.2013, the respondent no. 2, apart from claiming the deficient Stamp Duty, has imposed a penalty of Rs. 1 lakh on the petitioner. The order does not give any reason for imposition of such penalty and its amount. It is noted that the deceased late Shri Jagdish Prashad Sharma is claimed to have left behind his Will bequeathing his share in the property to the petitioner. The Relinquishment Deeds have also been executed by the sisters in favour of the petitioner. Therefore, an intent to evade Stamp Duty on part of the petitioner is not evident. 38. In view of the above, the Impugned Order dated 01.03.2013 passed by the respondent no. 3 and the Impugned Order dated 15.05.2013, in so far as it demands ..... X X X X Extracts X X X X X X X X Extracts X X X X
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