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1999 DIGILAW 90 (KER)

Sreedevi v. State of Kerala

1999-02-16

C.S.RAJAN

body1999
Judgment :- C.S. Rajan, J. In these Original Petitions a common question as to whether the petitioners who are licensed Stamp Vendors are entitled to sell special adhesive stamps, share transfer stamps, foreign bill stamps, Hundy paper and Insurance Stamps on the strength of the licence issued to mem, arises for consideration. On an earlier occasion the Association of the Stamp Vendors approached this Court challenging the decision of the then Board of Revenue that Stamp Vendors like the petitioners are not empowered to sell the stamps mentioned above under the licenses issued to them. A learned single judge of this Court held that the above view is correct. The matter was taken up in appeal and a Division Bench of this Court in W.A. No. 812/93 (Ext. P4 in O.P.No. 3865 of 1999) directed the appellants therein to make a representation to the Board of Revenue and the Board of Revenue was directed to consider and dispose of the same by a speaking order. Accordingly Ext. P6 (OP 3865/99 has been passed by the Government (By that time the Board of Revenue was abolished). 2. In Ext. P6 the reasoning for rejecting the claim of the petitioners to sell the above mentioned stamps is that the above stamps would not come under the Kerala Manufacture and Sale of Stamp Rules (hereinafter referred to as 'the Kerala rules'). Therefore, the petitioners request was rejected. 3. The learned counsel for some of the 'petitioners Sri. V. Giri took me to the various provisions contained in the Indian Stamp Act, the Kerala Rules and the Indian Stamp Manufacture and Sale (Kerala) Rules (hereinafter referred to as 'the Central rules'). The Kerala Rules were framed by the Government under S.69 of the Kerala Stamp Act, 1959. S.69 of the Kerala Stamp Act empowers the Government to frame rules with regard to the supply and sale of stamps and stamp papers, the persons by whom alone such sale is to be conducted, the duties and remuneration of such persons and the fine which shall in no case exceed Rs. 500/- to be incurred on breach of any rule. S.69 reads as follows: "69. 500/- to be incurred on breach of any rule. S.69 reads as follows: "69. Power to make rules:- The Government may, by notification in the Gazette, make rules to carry out generally the purposes of this Act (2 In particular and without prejudice to the generality of the foregoing power such rules may be made for regulating (a) the supply and sale of stamps and stamped papers. (b) the persons by whom alone such sale is to be conducted. (c) the duties and remuneration of such persons, and (d) the lines which shall in no case exceed five hundred rupees to be incurred on breach of any rule: Provided that such rules shall not restrict the sale of adhesive stamp of the value of (twenty paise) or less. 4. R.35 of the Kerala Rules says that the sale of stamps shall be made by the Treasurers as ex-officio stamp vendors and by licensed stamp vendors appointed by the Tahsildars in respect of the documents embossed and returned to the parties under R.16. It further provided for the appointment of the Vendors in various places by the District Collector. R.38 of the Kerala Rules provides for executing an agreement in Form No. II before the license is issued to the Stamp Vendors. 5. The Central Rules were issued by the Government in exercise of the powers conferred by Ss.74 and 75 of the Indian Stamp Act. S.74 empowers the State Government to make rules for regulating the supply and sale of stamps and stamped papers, the persons by whom alone such sale is to be conducted and the duties and remuneration of such persons. S.75 further empowers the Government to make rules to carry out generally the purposes of the Act. By virtue of R.2 of the Central Rules, the Kerala Rules issued under the Kerala Stamp Act shall apply in respect of documents specified in Entry 91 of List 1 of Seventh Schedule of the Constitution of India. The only restriction is with regard to the sale of revenue stamps which can be made through Post Offices. Entry 91 of List I of Seventh Schedule reads as follows: "91. Rates of stamp duty in respects of bills of exchange, cheques, promissory notes, bills of lading, letters of credit, policies of insurance, transfer of shares, debentures, proxies and receipts." 6. Ext. Entry 91 of List I of Seventh Schedule reads as follows: "91. Rates of stamp duty in respects of bills of exchange, cheques, promissory notes, bills of lading, letters of credit, policies of insurance, transfer of shares, debentures, proxies and receipts." 6. Ext. P6, the impugned order in O.P. 3865/99 refers to a letter from the Secretary, Board of Revenue dated 6.7.89 wherein the District Treasury Officer, Ernakulam was directed to issue only judicial and non-judicial stamps and copying sheets and not to issue any other item in future. According to Ext. P6 the above direction is binding on the stamp vendors as per the above rule. Even though Rule 2 of the Kerala Rules included all documents specified in Entry 91 of List 1 of the Seventh Schedule of the Constitution, the above documents do not come under the Kerala Rules irrespective of whether these items are there in Entry 91 or not. 7. I think the above reasoning is faulty and does not deal with the rules both Kerala and Central as well as the rule making powers of the Kerala Government. S.69 of the Kerala Stamp Act and Ss.74 and 75 of the Indian Stamp Act empower the Kerala Government to make rules regarding the sale of stamps. In exercise of these powers the Government framed both Kerala and Central Rules. R.2 of the Central Rules specifically provides for sale of the stamps in relation to the documents mentioned in Entry 91 of the List I of Seventh Schedule of the Constitution. It further says that the Kerala Rules are made applicable in the matter of sale of these stamps. There is no separate provision in the Central Rules for appointing any Stamp Vendors for the sale of these stamps. Appointment of the Stamp Vendors is exclusively under the Kerala Rules. Therefore, if a Stamp Vendor is appointed under the Kerala Rules to sell the stamps, men the sale cannot be restricted to the sale of stamps under the Kerala Stamp Act only. They are also entitled to sell the stamps in relation to the documents mentioned in Entry 91 of List I of Seventh Schedule of the Constitution. 8. Therefore, if a Stamp Vendor is appointed under the Kerala Rules to sell the stamps, men the sale cannot be restricted to the sale of stamps under the Kerala Stamp Act only. They are also entitled to sell the stamps in relation to the documents mentioned in Entry 91 of List I of Seventh Schedule of the Constitution. 8. The learned Government Pleader on instructions submits that the petitioners have executed an agreement with the Government which provides, inter alia, that they are bound to obey all such orders as may be issued to the Vendors by the Government or by any officer authorised by the Government regarding the sale of such stamps and stamp papers. Perhaps this is the order which has been referred to in Ext. P6 order by the Government. I do not think that the above clause in the agreement will help the Government to prohibit the sale of stamps in relation to documents mentioned in Entry 91 of List I of Seventh Schedule of the Constitution by the petitioners. When the Act and the Rules provide for sale of such stamps by the Vendors, even if there is a direction prohibiting such sale, the Vendors are not bound by any such direction. This is because the direction or order mentioned in the agreement must be orders and directions issued " in terms of the law and not inconsistent with the law. As held by me earlier when the Rules enjoin the petitioners to sell the stamps in relation to the documents mentioned in Entry 91 of List I of Seventh Schedule of the Constitution, no authority can issue any direction prohibiting the sale of such stamps. Therefore, the direction mentioned in Ext. P6 is illegal and without jurisdiction. Therefore, I quash Ext. P6 (in OP Nos. 3368 & 3865/99) and the similar order (Ext. P3) produced in OP No. 2941/99. The respondents are directed to issue the stamps in relation to the documents mentioned in Entry 91 of List I of Seventh Schedule of the Constitution to the petitioners, forthwith. The Original Petitions are allowed.