Research › Search › Judgment

Madras High Court · body

2007 DIGILAW 192 (MAD)

D. Veeramani v. D. Vasu & Others

2007-01-19

S.ASHOK KUMAR

body2007
Judgment :- As against dismissal of the I.A., filed by the plaintiff to reject the document marked as Ex.D.6, by the defendant which is a Schedule of Partition, on the ground that the same is an unstamped and unregistered document, this revision has been preferred. 2. The defendant contested the said application stating that the when the document was marked on the side of the defendant, there was no objection raised by the plaintiff and having remained silent all along now, the plaintiff cannot agitate the same. 3. The learned Additional Subordinate Judge, Tindivanam after consideration of the the averments and the rival submissions of both the parties dismissed the said I.A., holding that the plaintiff is not entitled to raise such a plea as he has not pleaded his objection either at the time of marking the document or even thereafter when the matter was adjourned for nearly 4 occasions. The learned Subordinate Judge also held that at the most such an objection can be taken into consideration only at the time of final hearing of the case and not at the preliminary stage. Aggrieved over the said findings, this revision has been filed by the revision petitioner/plaintiff. 4. Learned counsel for the revision petitioner contended that the learned Subordinate Judge ought to have seen that the document marked by the respondent is neither registered nor stamped as provided under Section 17 of the Indian Registration Act and ought to have seen that the instrument not duly stamped is inadmissible in evidence as provided under Section 35 of the Indian Stamp Act. Having failed to exercise such duty, it is untenable to dismiss the I.A., filed by him to reject the document by stating that the plaintiff has not raised any plea at the time of marking the said document. Learned counsel also contended that he had made an endorsement of objection even at the time of filing of the said document and the learned Subordinate Judge is incorrect in saying that no objection has been raised by the plaintiff. 5. On a similar issue in CRP.No:721 of 2005 while deciding the matter, by order dated 211. 2006 this court held as follows:- "3. 5. On a similar issue in CRP.No:721 of 2005 while deciding the matter, by order dated 211. 2006 this court held as follows:- "3. Learned counsel for the revision petitioner contended that a document which ought to have been registered under the Indian Registration Act, which has not been registered shall not be even marked even for the collateral purposes. He placed reliance on the following judgments: .(1) 1937 II MLJ 805 (Penatapati Nageswara Rao Vs. Moka Narayanamurthi and another) .(2) AIR 1946 P.C.,51 (Ram Rattan Vs.Parma Nand) .(3) AIR 1971 SC 1070 (Jupudi V. Pulavarthi) .(4) AIR 1987 Patna 191 (FB) Amar Singh Yadav V. Shanthi Devi. .(5) 2001 (1) CTC 112 (AC.Lakshmipathy & Anr. V. A.M.Chakrapani Reddiar and 6 ors. 4. In 1937 II MLJ 805 (Penatapati Nageswara Rao Vs. Moka Narayanamurthi and another) a Division Bench of this Court held that the improperly stamped document could not be used to prove a collateral purpose, namely the acknowledgment of liability on previous notes. 5. In AIR 1946 P.C. 51 (Ram Rattan Vs.Parma Nand) the Privy Council held that the words for any purpose in Section 35 of the Stamp Act, should be given their natural meaning and effect and would include a collateral purpose. Where an unstamped document is admitted in proof of some collateral matter it is certainly admitted in evidence for that purpose which the statute has prohibited. Consequently, an unstamped partition deed cannot be used to corroborate the oral evidence for the purposes of determining even the factum of partition as distinct from its terms. 6. In AIR 1971 SC 1070 (Jupudi V. Pulavarthi) the Honble Supreme Court held that in view of Sections 35 and 36, secondary evidence by way of oral evidence or copy of document insufficiently stamped is not admissible in a suit even though objection to its admissibility cannot be taken under the Evidence Act. 7. In 2001 (1) CTC 112 (AC.Lakshmipathy & Anr. V. A.M.Chakrapani Reddiar and 6 ors, a Division Bench of this Court held that unstamped documents if required to be stamped but not so stamped cannot be looked into for any purpose including collateral purpose. 8. However, the learned counsel for the respondent relied on the judgment of the Apex Court reported in 2004 (I) LW. 706, Bondar Singh Vs. V. A.M.Chakrapani Reddiar and 6 ors, a Division Bench of this Court held that unstamped documents if required to be stamped but not so stamped cannot be looked into for any purpose including collateral purpose. 8. However, the learned counsel for the respondent relied on the judgment of the Apex Court reported in 2004 (I) LW. 706, Bondar Singh Vs. Nihal Singh wherein Their Lordships have held that "Under the law, a sale deed is required to be properly stamped and registered before it can convey title to the vendee. However, legal position is clear law that a document like the sale deed in the present case, even though not admissible in evidence, can be looked into for collateral purposes." The learned counsel also relied on the Division Bench of this Court reported in 2004 (3) MLJ 362 (Venugopal @ Alagarsamy and ors Vs. Bajanai Alagarsamy and anr) wherein this court held that "though unregistered documents are inadmissible in evidence, they may be considered for collateral purpose. 9. In AIR 1987 Patna 191 (FB) Amar Singh Yadav V.Shanthi Devi a Full Bench of the Patna High Court held that where there is a direct conflict between two decisions of the Supreme Court by co-equal Benches, the High Court must follow the judgment which states the law more elaborately and accurately and the question whether the decision is earlier or later, is not the criteria. 10. As far as this case is concerned, the decision of the Honble Supreme Court reported in AIR 1971 SC 1070 (Jupudi V. Pulavarthi) deals with Section 35 and 36 of the Stamp Act in detail whereas the decision reported in 2004 (I) LW. 706, Bondar Singh Vs. Nihal Singh as well as the Division Bench judgment of this Court in 2004 (3) MLJ 362 (Venugopal @ Alagarsamy and ors Vs. Bajanai Alagarsamy and anr) Sections 35 and 36 of the Stamp Act has not been discussed at all. Therefore, when there is a conflicting judgments by the two co-equal Benches, the judgment of the larger bench which directly deals with in detail about the controversy regarding the stamp Act has to be preferred than the other judgments which does not discuss about such controversy. 11. However, in 2005 (4) MLJ 337 (Tmt.Indirani Vs.Seetharaman), which is the latest among the cited decisions, this Court held as follows:- "14. In Bondar Singh and others Vs. 11. However, in 2005 (4) MLJ 337 (Tmt.Indirani Vs.Seetharaman), which is the latest among the cited decisions, this Court held as follows:- "14. In Bondar Singh and others Vs. Nihal Singh and others (2004) I L.W. 706 the Apex Court has observed: "Under the law, a sale deed is required to be properly stamped and registered before it can convey title to the vendee. However, legal position is clear law that a document like the sale deed in the present case, even though not admissible in evidence, can be looked into for collateral purposes." 15. This observation guided the learned trial judge to admit the documents, in question, in evidence, though they are unstamped. In the case involved in the above decision also, the documents ought to be relied on was an unregistered and unstamped sale deed. But, the same was admitted, in evidence, for collateral purposes. Though such an observation has been made, the Honble Apex Court has not considered the effect of Section 35 of the Stamp Act. If Sec.35 of the Stamp Act was considered and the wording stated therein, vi., for any purpose, is ignored, then, if it is said, it can be taken as the law declared by the Apex Court, which is binding upon the Courts below throughout the breadth and length of this country. As seen from the above decision, nowhere it is discussed about the effect of Section 35 of the Stamp Act, though in the head note, the publishers have stated, Stamp Act Secs. E35, 32, 36 Registration Act, 49, etc., In the absence of any discussion about the payment of stamp duty and penalty, mere observation that the document could be looked into, for collateral purposes, alone, is not sufficient to allow all the documents un stamped, which required stamp duty, should be admitted in evidence, thereby offending the statute viz., in this case Section 35 of the Stamp Act. In this context, it is useful to refer to the decision of the Apex court in Bipin Shantilal Panchal V. State of Gujarat and another (2001) 3 SCC 1 and Chilakuri Gangulappa V. revenue Divisional Officer, Madanapalle and another, (2001) 2 MLJ 33 (SC). 16. In the first decision, the objection raised regarding the admissibility of a document came before the Apex Court, for consideration. 16. In the first decision, the objection raised regarding the admissibility of a document came before the Apex Court, for consideration. The Apex Court in a way, criticised the archaic practice and prescribed guidelines as to how the documents should be admitted in evidence, despite the objection raised by the other side. It is observed that, "Whenever an objection is raised during evidence taking stage regarding the admissibility of any material or item of oral evidence, the trial court can make a note of such objection and mark the objected documents tentatively as an exhibit in the case (or record the objected part of the oral evidence) subject to such objections to be decided at the last stage in the final judgment. If the court finds at the final stage that the objection so raised is sustainable, the Judge or Magistrate can keep such evidence excluded from consideration. In our view there is no illegality in adopting such a course. (However, we make it clear that if the objection relates to deficiency of stamp duty of a document, the Court has to decide the objection before proceeding further. For al other objections, the procedure suggested above can be followed." 17. The last portion of the above observation makes it clear that if the objection relates to deficiency of stamp duty of a document, the court has to decide the objection before proceeding further. Therefore, in this case, the trial court should have considered, whether the documents require stamp duty and penalty or not, before allowing the documents to be admitted, in evidence, for collateral purposes, which was not followed. Therefore, I am unable to affix my seal of approval, as such, to the order passed by the trial Court, which requires modification. 18. Therefore, in this case, the trial court should have considered, whether the documents require stamp duty and penalty or not, before allowing the documents to be admitted, in evidence, for collateral purposes, which was not followed. Therefore, I am unable to affix my seal of approval, as such, to the order passed by the trial Court, which requires modification. 18. In the second case viz., Chilakuri Gangulappa Vs Revenue Divisional officer, Madanpalle and another (2000) 2 MLJ 33, the Apex Court considering Sec.38 of the Indian Stamp Act, 1899, and the fact under what circumstances, as insufficiently stamped document could be admitted in evidence, has observed that it is the duty of the Court, at the first instance, that if the Court finds that the instrument is insufficiently stamped, it should call upon the party, as to whether he would remit the deficient portion of the stamp duty together with a penalty, amounting to ten times the deficiency, and in the case if the party agrees to remit the said amount, the Court has to proceed with trial, after admitting the document in evidence. The, it contemplates what are the further proceedings to be initiated under Sec.38 of the Stamp Act etc. In the case involved in the above decision also, an insufficiently stamped document came to the consideration of the Apex Court. If the Apex Court was of the view that un-stamped or unregistered documents are, automatically, to be admitted in evidence, without reference to Section 35 of the Indian Stamp At, then the Apex Court would not have observed that the Court should call upon the party to remit the deficient portion of the stamp duty together with a penalty, amounting to ten times the deficient or even the lesser penalty. Since the Apex Court was conscious about Section 35 of the Stamp Act, while considering Section 38, it is observed on the basis of Section 38(1) of the Stamp Act:- It is clear from the first sub section extracted above that the court has a power to admit the document in evidence if the party producing the same would pay the stamp duty together with a penalty amounting to ten times the deficiency of the stamp duty. When the court chooses to admit the document on compliance of such condition, the court need forward only a copy of the document to the Collector, together with the amount collected from the party for taking adjudicatory steps. Thus, showing, if the party fails to pay the stamp duty and penalty, the document is not to be admitted in evidence, in view of the embargo contemplated under Section 35 of the tamp Act. This ruling also, supports Section 35 of the Stamp Act, that no document shall be admitted in evidence for any purpose, unless it is properly stamped, and in case, if it is not properly stamped, without payment of stamp duty and penalty and that is the reason, we find the words in Sec.38(1) of the Stamp Act that when the person impounding an instrument in evidence, upon payment of a penalty, as provided by Sec.35 or of duty as provided by Sec.37...thereby confirming, without payment of stamp duty and penalty, no document shall be admitted in evidence. xx xx xx xx xx 20. There cannot be any dispute, as long as Section 35 of the Stamp Act is available in the Statute, that the same is to be applied for all the instruments, which require stamp duty. This being the position, unless a finding is given as observed by the three Judges Bench of the Apex Court, in Bipin Shantilal Panchal V. State of Gujarat (2001) 3 SCC 1 , regarding the stamp duty and penalty, the document cannot be admitted in evidence, as if it can be looked into for collateral purpose. No doubt, it is true, a document, which is unregistered or unstamped can be looked into for collateral purpose, provided, provisos to Sec.35 of the Stamp Act are complied with, and not otherwise. The above position of law was not considered properly by the trial court and therefore, the order of the trial Court requires modification, in my considered opinion, in view of the admitted position that the documents in question, require stamp duty and penalty". .12. I am in agreement with the views expressed by my Learned Brother M.Thanickachalam,J., Though the judgment of the Supreme Court relied on by the revision petitioner in 2001 (1) CTC 112 (AC.Lakshmipathy & Anr. V. A.M.Chakrapani Reddiar and 6 Ors), still, the judgment of this court in 2005 (4) MLJ 337 (Tmt.Indirani Vs. .12. I am in agreement with the views expressed by my Learned Brother M.Thanickachalam,J., Though the judgment of the Supreme Court relied on by the revision petitioner in 2001 (1) CTC 112 (AC.Lakshmipathy & Anr. V. A.M.Chakrapani Reddiar and 6 Ors), still, the judgment of this court in 2005 (4) MLJ 337 (Tmt.Indirani Vs. Seetharaman) relied on by the learned counsel for the respondent, which is supported by several decisions of the Apex Court as relied on by the learned Single Judge in the said decision, has to be followed, because the point is not which is the earlier or latter, but the point is which judgment discusses the point in issue directly involved in the particular case elaborately and accurately. 13. Therefore it is clear no document shall be admitted in evidence if it is not properly stamped, and if already not stamped, then stamp duty should be paid with penalty as prescribed by the authority. As far as the present case is concerned, the plaintiff in her counter to the Interlocutory Application has specifically raised an objection that the document is inadmissible in evidence since the document in question has not been stamped sufficiently as per Article 23 viz., for the sale consideration of Rs.80,000/= at the rate of Rs.11/= for Rs.100/=, stamp fee for the value of Rs.8880/= has to be affixed together with a penalty amounting to ten times the deficiency. In the absence of payment of the above, the trial court has committed an error in marking the document even for collateral purpose. Hence, the order of the trial court is liable to be modified. 14. In the result, this CRP is allowed in part and the order of the trial court is modified. The trial court is directed to ascertain the stamp duty and penalty payable upon the disputed document, then call upon the party who wants to rely on those documents, to pay the stamp duty and penalty, and then on payment of stamp duty and penalty, admit the document in evidence, whether it is for collateral purpose or otherwise, which could be decided at the later stage while hearing the case as guided by the Apex Court in Bipin Shantilal Panchal V. State of Gujarat and another (2001) 3 SCC 1 . Consequently, connected MP is also dismissed." .6. Consequently, connected MP is also dismissed." .6. The above proposition of law squarely applies to the facts of the present case. When once the document which ought to have been compulsorily stamped and registered, on failing to do so, such document cannot be admissible in evidence. Therefore following the above decision, it is directed that the learned Additional Subordinate Judge, Tindivanam, is directed to ascertain the stamp duty and penalty payable upon the disputed document, then call upon the party who wants to rely on those documents, to pay the stamp duty and penalty, if he so desires, and then on payment of stamp duty and penalty, whether it is for collateral purpose or otherwise, which could be decided at the later stage while hearing the case as guided by the Apex Court in Bipin Shantilal Panchal V. State of Gujarat and another (2001) 3 SCC 1 , otherwise, the disputed document shall be rejected by the learned Additional Subordinate Judge. 7. In the result, the CRP is allowed in part as indicated above. Consequently connected MP is closed. No costs.