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TMI Blog2024 (7) TMI 537X X X X Extracts X X X X X X X X Extracts X X X X ..... with the absence of the counsel for the appellant before it when the GPA was admitted in evidence and marked exhibit, a factor which weighed with the Trial Court, we have no hesitation to hold that for all purposes and intents the Trial Court passed the order dated 19th October, 2010 in exercise of its inherent power saved by section 151, CPC, to do justice as well as to prevent abuse of the process of court, to which inadvertently it became a party by not applying judicial mind as required in terms of sections 33 and 34 of the 1857 Act. We appreciate the approach of the Trial Court in its judicious exercise of inherent power. The legislature has reposed responsibility on the courts and trusted them to ensure that requisite stamp duty, along with penalty, is duly paid if an unstamped or insufficiently stamped instrument is placed before it for admission in support of the case of a party. It is incumbent upon the courts to uphold the sanctity of the legal framework governing stamp duty, as the same are crucial for the authenticity and enforceability of instruments. Allowing an instrument with insufficient stamp duty to pass unchallenged, merely due to technicalities, would undermin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ber, 2003. The appellant paid the consideration, and a Sale Deed was executed on 8th October, 2003 between the appellant and Praveen Shetty. c. Civil Suit by the appellant: The appellant instituted a civil suit O.S. No. 301 of 2003 against the respondent, B. Ramesh Hegde, and Praveen Shetty, seeking a declaration that the Sale Deed dated 3rd October, 2003 was null and void, and not binding on the appellant. d. Civil Suit by the respondent: Conversely, the respondent also instituted a civil suit O.S. No. 134 of 2005 against the appellant and Praveen Shetty, seeking a declaration that the Sale Deed dated 8th October, 2003 was null and void, and not binding on the respondent. e. Filing of GPA before the Trial Court: In the suit instituted by the respondent, witness action commenced. B. Ramesh Hegde, in whose favour the GPA was executed by the respondent, on 6th June, 2010 tendered the GPA in course of his examination-inchief. The appellant s counsel was engaged in another court; hence, he was unable to appear. The junior counsel did not object that the GPA was insufficiently stamped and, thus, inadmissible in evidence. The Trial Court, in the absence of objection, admitted the GPA in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion of document in evidence. The argument of the counsel for the respondent is untenable. In the normal procedure when the document is produced, it is marked and exhibit number has assigned and beneath the said exhibit Judge puts his initial. This procedure fully complies with the requirement under Order 13 Rule 4 of the Act. Therefore, the contention that the document has not been properly marked and it should be rejected in evidence on the ground of insufficiently stamped is untenable. The trial court will have no jurisdiction to reconsider the issue. The remedy available for the respondent is only under section 58 of the Stamp Act. Accordingly, the writ petition is allowed. 6. It is the legality of the impugned order that we are tasked to examine while answering the question formulated at the beginning of this judgment. 7. Mr. Chaturvedi, learned counsel for the appellant, while laying a challenge to the impugned order argued that admission of an insufficiently stamped instrument in a casual manner by mechanically marking it as an exhibit, without any application of judicial mind, should not preclude the court seized of the proceedings from reconsidering whether such document i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elevant for a decision on this appeal, read as follows: 33. Examination and impounding of instruments.- (1) Every person having by law or consent of parties authority to receive evidence, and every person in charge of a public office, except an officer of police, before whom any instrument, chargeable in his opinion, with duty, is produced or comes in the performance of his functions, shall, if it appears to him that such instrument is not duly stamped, impound the same. (2) For that purpose every such person shall examine every instrument so chargeable and so produced or coming before him, in order to ascertain whether it is stamped with a stamp of the value and description required by the law in force in the State of Karnataka when such instrument was executed or first executed: Provided that, (a) *** (b) *** (3) For the purposes of this section, in cases of doubt, the Government may determine, (a) what offices shall be deemed to be public offices; and (b) who shall be deemed to be persons in charge of public offices. 34. Instruments not duly stamped inadmissible in evidence, etc.- No instrument chargeable with duty shall be admitted in evidence for any purpose by any person havi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncluding duty and penalty) which, according to the determination of such Court, was payable in respect of the instrument under Section 34, is paid the Deputy Commissioner, unless he thinks that the offence was committed with an intention of evading payment of the proper duty; (b) except for the purpose of such prosecution, no declaration made under this section shall affect the validity of any order admitting any instrument in evidence, or of any certificate granted under Section 41. ( emphasis ours ) 12. Read in isolation, a literal interpretation of section 35 of the 1957 Act seems to make the position in law clear that once an instrument has been admitted in evidence, then its admissibility cannot be contested at any stage of the proceedings on the ground of it not being duly stamped. A fortiori, it would follow that any objection pertaining to the instrument s insufficient stamping must be raised prior to its admission. 13. However, section 35 of the 1957 Act is not the only relevant section. It is preceded by sections 33 and 34 and all such sections are part of Chapter IV, tiled Instruments Not Duly Stamped . Certain obligations are cast by section 33 on persons/officials name ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ely when presented as evidence. The relevant paragraph is extracted hereunder: 4. *** Where a question as to the admissibility of a document is raised on the ground that it has not been stamped, or has not been properly stamped, it has to be decided then and there when the document is tendered in evidence. Once the court, rightly or wrongly, decides to admit the document in evidence, so far as the parties are concerned, the matter is closed. Section 35 is in the nature of a penal provision and has far-reaching effects. Parties to a litigation, where such a controversy is raised, have to be circumspect and the party challenging the admissibility of the document has to be alert to see that the document is not admitted in evidence by the court. The court has to judicially determine the matter as soon as the document is tendered in evidence and before it is marked as an exhibit in the case. The record in this case discloses the fact that the hundis were marked as Exts. P-1 and P-2 and bore the endorsement admitted in evidence under the signature of the court. It is not, therefore, one of those cases where a document has been inadvertently admitted, without the court applying its mind t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vertently admitted without the court applying its mind as to the question of admissibility, the instrument could not be said to have been admitted in evidence with a view to attracting Section 36 (see Javer Chand v. Pukhraj Surana) [AIR 1961 SC 1655] . The endorsement made by the learned trial Judge that Objected, allowed subject to objection , clearly indicates that when the objection was raised it was not judicially determined and the document was merely tentatively marked and in such a situation Section 36 would not be attracted. (emphasis ours) 17. The pivotal aspect emerging for consideration on the terms of sections 33 and 34 of the 1957 Act, with which we are concerned, is that whether the Trial Court did judicially determine the question of admissibility. It is here that we need to ascertain the rationale behind the Trial Court s approach to go behind admission of the GPA in evidence and marking thereof as an exhibit, leading to the order under challenge before the High Court. Relevant portions of the order of the Trial Court read thus: 2. *** There are two suits before this court, one is the present suit and another suit is OS No. 301/03. In the present suit, the GPA holde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not arise. As seen from the order sheet, the plaintiff was examined on 6.6.2010 and document was marked on same day. Immediately on the next date of hearing the counsel has filed IA No. IX and X to consider the aspect of payment of stamp duty and penalty i.e., on the day on which the matter was posted for cross examination of PW1. It is certain that the senior counsel appearing for the plaintiff was not present at the time of examination of PW1 in chief as the court remembers that the junior counsel was present and probably being unaware of the question of stamp duty has not raised any objections. The court has marked the document as an exhibit and has put the seal for having marked the document as to who has produced the document and admitted through which witness and marked for plaintiff. No doubt, there is mention that the document is admitted through PW1 and Ex.P2, but the court has not applied its mind while marking the document as to whether document is sufficiently stamped or insufficiently stamped. 10. *** The circumstances under which the application is being filed and circumstances under which the document came to be marked, clearly show that the document was marked wit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not attracted. 21. We may not turn a blind eye to the fact that the revenue would stand the risk of suffering huge loss if the courts fail to discharge the duty placed on it per provisions like section 33 of the 1957 Act. Such provision has been inserted in the statute with a definite purpose. The legislature has reposed responsibility on the courts and trusted them to ensure that requisite stamp duty, along with penalty, is duly paid if an unstamped or insufficiently stamped instrument is placed before it for admission in support of the case of a party. It is incumbent upon the courts to uphold the sanctity of the legal framework governing stamp duty, as the same are crucial for the authenticity and enforceability of instruments. Allowing an instrument with insufficient stamp duty to pass unchallenged, merely due to technicalities, would undermine the legislative intent and the fiscal interests of the state. The courts ought to ensure that compliance with all substantive and procedural requirements of a statute akin to the 1957 Act are adhered to by the interested parties. This duty of the court is paramount, and any deviation would set a detrimental precedent, eroding the integ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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