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2001 DIGILAW 68 (KAR)

NEW INDIA ASSURANCE CO. LTD v. R. ANANTHALAKSHMI

2001-01-17

R.V.RAVEENDRAN, V.G.SABHAHIT

body2001
RAVEENDRAN, J, J. ( 1 ) AS. I and II (for condonation of delay and for stay) are supported by affidavits sworn to before a Notary Public. The Registry has raised an objection that the affidavits are defective "as they have not been affixed with Notarial stamps as required under Article 36 of the schedule to the Karnataka Stamps Act, 1957 ('act' for short) ( 2 ) THE Office objections was answered by stating that affidavits to be filed in Courts were exempt from stamp duty; and therefore there was no need to affix any Notarial stamps to such affidavits. As the Registry is not satisfied the matter is placed before us for orders. ( 3 ) RELEVANT portions of Articles 4 and 36 of the Schedule to karnataka Stamp Act, 1957 ('stamp Act' for short) read as follows: article Description of instrument proper Stamp Duty 4 Affidavit, including an affirmation or declaration in the case of persons by law allowed to affirm or declare instead of Swearing. Exemptions: Affidavit or declaration in writing, when made, (a) xxx xxx xxx (b) for the immediate purpose of being filed or used in any Court or before the office of any Court; or Twenty, Rupees Article description of instrument Proper Stamp Duty (c) xxx XXX XXX 36 notarial Act, that is to say any instrument, endorsement note, attestation, certificate, or entry, not being a protest (No. 42) made or signed by a Notary Public in the execution of duties of his office, or by any other person lawfully acting as a Notary Public. Ten Rupees the Stamp duty in respect of notarial Acts is paid by affixing special adhesive stamps bearing the word 'notarial' under Section 11 (c) of the Stamp Act read with Rule 14 (a) of the Karnataka Stamp rules, 1958. ( 4 ) IF any notarial act is made or executed by a Notary with reference to an affidavit (or other instrument) then Stamp duty is attracted under Article 36 in respect of such notarial Act. The stamp duty for a notarial act under Article 36 is independent and separate from the stamp duty payable in respect of such affidavit (or other instrument ). For example if a partnership deed is executed, the stamp duty on the deed of partnership will have to be paid under Article 40. The stamp duty for a notarial act under Article 36 is independent and separate from the stamp duty payable in respect of such affidavit (or other instrument ). For example if a partnership deed is executed, the stamp duty on the deed of partnership will have to be paid under Article 40. If such partnership deed executed on appropriate stamp paper is attested by a Notary, then stamp duty for the notarial Act as provided under Article 36 will have to be affixed. Therefore, the exemption granted in regard to payment of stamp duty prescribed under Article 4, in regard affidavits to be filed in Court will not apply to stamp duty prescribed for any notarial act with reference to the instrument, in the absence of a corresponding exemption under the article 36. Therefore, the contention that affidavits to be filed in Court are not required to be affixed with Notarial Stamp duty in view of the exemption under Article 4, is not tenable. ( 5 ) THE learned Counsel for the appellant next contended that all notarial acts are not liable to notarial stamp duty under Article 36 and that only the enumerated notarial acts i. e. , any instrument, endorsement note, attestation, certificate or entry (not being a protest) made or signed by a Notary Public in the execution of the duties of his office, will be liable to stamp duty as a notarial act. It is contended that when a person swears to an affidavit before a Notary, what is done by the notary is to administer oath in respect of an affidavit and such act is not an attestation or certification of an affidavit and therefore Article 36 is not attracted. The Court's attention is invited to Clauses (a) and (e) of Sub-Section (1) of Section 8 of the Notaries act which enumerates the functions of notaries. Clause (a) refers to verification, authentication, certification or attestation of execution of any instrument. Clause (e) deals with administering oath to, or taking affidavit from, any person. It is contended that Notaries act differentiates between 'attestation' under Clause (a) and 'administering oath' under Clause (e) and therefore 'attestation' does not include administering oath taking an affidavit from any person. The learned counsel for the appellant therefore wants the Court to infer that when an affidavit is sworn to before a Notary Public, it does not involve any 'attestation'. The learned counsel for the appellant therefore wants the Court to infer that when an affidavit is sworn to before a Notary Public, it does not involve any 'attestation'. He also submits that there is no certification or endorsement by a Notary when administering oath and therefore an affidavit is not liable to notarial stamp duty. ( 6 ) THE word 'attestation' is not defined either in the Karnataka stamp Act, 1957 or in the Notaries Act 1952 or in the General clauses Act. Hence we have to fall back upon ordinary meaning of attestation. Dictionaries (Blacks Law Dictionary and Chambers dictionary) give two meanings to the word 'attestation'. They are "an act of attesting that is to authenticate by signing as a witness and "the administration of an oath". Therefore, any act of administration of an oath in respect of an affidavit or making a certificate confirming that the affidavit was sworn to by the deponent before him is a Notarial Act falling under-Article 36, attracting Notarial stamp duty. ( 7 ) A learned Single Judge of the Allahabad High Court in KASHI prasad SAKSENA vs STATE OF UTTAR PRADESH negatived a similar contention while considering Article 42 of the Stamp Act, 1899 (equivalent to Article 36 of Karnataka Stamp Act, 1957) by holding that swearing to an affidavit before a Notary involves an 'endorsement' by the Notary and therefore attracts notarial stamp duty. The reasoning is extracted below:"the argument raised on behalf of the petitioner is that the view of the Competent Authority that notarial stamp was necessary in accordance with the said provision on the certificate given by the petitioner on the affidavits to the effect that such and such person had verified the affidavit on such and such date at such and such place and at such and such hour after having been explained the contents of the affidavit is erroneous for the simple reason that such a certificate or endorsement is required to be stamped under Article 42 only when it can be taken to have been granted or made "in the execution of the duties of his office. . . as a Notary Public". Learned Counsel contends that there is nothing either under the Notaries Act or the rules thereunder to require the Notary Public to give such a certificate or make such an "endorsement" on an affidavit. . . as a Notary Public". Learned Counsel contends that there is nothing either under the Notaries Act or the rules thereunder to require the Notary Public to give such a certificate or make such an "endorsement" on an affidavit. In this connection he has drawn my attention to various clauses of sub-Section (1) of section 8 of the Notaries Act. He points out that whereas Clause (a) requires a Notary Public to verify, authenticate certify or attest the execution of any instrument, its Clause (e) simply says "administer oath to, or take affidavit from, any person. " Thus, the argument is that all that is required of a Notary under the provisions of the Act in relation to an affidavit is to administer oath and in so far as it is nowhere said that a certificate in token of such administration be granted, it cannot be said that a certification to that effect or an endorsement to that effect would fall within Article 42 of the Stamp Act so as to require notarial stamp. In my view the argument is not sound. After oath has been administered or an affidavit has been taken by a Notary, unless that fact is certified or endorsed on the affidavit the affidavit remains a waste paper. So, in my view the language employed in Clause (e) Section 8 (1) of the Act clearly implied that an endorsement to that effect has got to be made. At any rate, since the administration of oath is a notarial act, the statement of the fact that oath has been administered in the endorsement given on the affidavit subsequent to the administration of oath cannot but be taken to have been made in execution of the duties of the notary, namely, to administer oath. "we are in respectful agreement with the said view. We are also of the view, that all notarial acts attract stamp duty. Article 36 and 42 together cover the entire gamut of notarial acts and the contention that only certain notarial acts require stamp duty and some notarial act do not requiring (notarial) stamp duty is untenable. ( 8 ) LASTLY it is contended that when the legislative intent is to exempt affidavits to be filed in Court from stamp duty (under Article 4), it should be inferred that Notarial acts relating to such Court affidavits are also exempt from stamp duty. ( 8 ) LASTLY it is contended that when the legislative intent is to exempt affidavits to be filed in Court from stamp duty (under Article 4), it should be inferred that Notarial acts relating to such Court affidavits are also exempt from stamp duty. If the legislative intent was to exempt affidavits filed in Court from Notarial Stamp duty under article 36, an exemption would have been specified under Article 36, as was done under Article 4. But, such an exemption is significantly absent under Article 36. Hence, the exemption under article 4 cannot be read into Article 36. ( 9 ) LASTLY it is pointed out that Court affidavits attested by Oath commissioner are not subjected to stamp duty. It is contended that subjecting affidavits attested by Notary Publics to Stamp duty under article 36, while not subjecting affidavits attested by Oath commissioners to stamp duty, amounts to hostile discrimination and will result in deponents of affidavit avoiding Notary Publics, thereby affecting the livelihood of Notaries. The powers and functions of notaries are completely different from those Oath Commissioners. There is therefore no discrimination. Further, such a contention of discrimination will not be available in regard to a taxing statute like stamp Act. If the Notaries want exemption from Notarial stamp duty in regard to Court affidavits, the appeal should be to the Legislature and not Judiciary. In fact, we commend the system followed in the neighbouring States where affidavits to be filed in Courts can be attested by any Advocate and hope that a similar facility is extended to the litigants in Karnataka also to avoid hardship to the litigant public. Be that as it may. ( 10 ) THE Office Objection is upheld. The appellant is directed to get the attestation of affidavit rectified or file fresh affidavit duly attested within one month. The Registry is directed to ensure that all affidavits filed in Courts attested by Notaries are affixed with appropriate Notarial Stamps under Article 36. --- *** --- .