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Andhra High Court · body

2008 DIGILAW 1052 (AP)

P. Ramesh v. Shaik Begum Bee

2008-12-10

P.S.NARAYANA

body2008
JUDGMENT : Heard Sri K. V. Satyanarayana, the learned counsel representing the petitioner and Sri V. Ramakrishna Reddy, the learned counsel representing the respondents. 2. Sri K.V.Satyanarayana, the learned counsel representing the petitioner had taken this Court through the contents of the affidavit filed in support of the application and would maintain that no doubt under the peculiar facts and circumstances of the case, this application is filed in the present second appeal, but however, in the light of Section 107 (2) of the Code of Civil Procedure (hereinafter referred to as "The Code" in short for the purpose of convenience), there is no bar imposed on this Court even in a second appeal to pass appropriate or suitable orders, especially, in the peculiar facts and circumstances of this case. The learned counsel would explain that in the light of Section 38 (2) of the Indian Stamp Act (hereinafter referred to as "The Act" in short for the purpose of convenience) inasmuch as the petitioner is ready and willing to pay the stamp duty and penalty, it may be just and proper to pass appropriate orders. The learned counsel also had drawn the attention of this Court to the relevant provisions of the Code and also relevant provisions of the Act. The learned counsel also relied on certain decisions. 3. Per contra, Sri V. Ramakrishna Reddy, the learned counsel representing the respondents would maintain that here is a party, who had taken advantage of the decree, which had been granted by the Court of first instance, was not interested in taking further steps, and inasmuch as, the same had been reversed by the Appellate Court at the stage of this second appeal, this application had been filed and there are no bonafides at all. The learned counsel also would maintain that the purpose of paying the stamp duty and penalty of impounding is for the purpose of marking the document. The question of marking the document would not arise at the stage of second appeal. The learned counsel also would point out that the petitioner had not chosen to mark this document before the trial Court. At any rate, the learned Counsel also would maintain that Section 38 (2) of the Act cannot be made applicable at the appellate stage. The question of marking the document would not arise at the stage of second appeal. The learned counsel also would point out that the petitioner had not chosen to mark this document before the trial Court. At any rate, the learned Counsel also would maintain that Section 38 (2) of the Act cannot be made applicable at the appellate stage. The learned counsel had taken this Court through the contents of the counter-affidavit and ultimately, would conclude that this is not a fit matter where the application to be allowed. The learned counsel also relied on certain decisions to substantiate his submissions. 4. Heard the learned counsel. 5. This application is filed by the petitioner/appellant praying this Court to send the agreement of sale dated 15.02.1990 to the District Registrar and Collector under the Indian Stamp Act, Nalgonda so as to enable the petitioner to pay the Stamp Duty and get payment endorsement on the document by the District Registrar and pass such other suitable orders. 6. It is stated in the affidavit filed in support of this application that the petitioner obtained an agreement of sale with regard to an extent of Ac.5-00 of land in S.No.477/AA, 478, 475, 477/A, in Kodada Village. The said agreement is dated 15.02.1990 and it is for a consideration of Rs.1,95,000/- and a sum of Rs.1,82,000/-had been paid. Pursuant to that, the petitioner was put in possession of the property. The original executant expired in December, 1990. Since D1, D2 and D3 made attempts to trespass into the plaint schedule property, the petitioner was left with no other option except to file a suit for injunction. 7. It is also stated that during the course of evidence, he prayed for permission for marking the document dated 15.02.1990. The respondents/defendants herein had taken an objection as to the admissibility of the agreement of sale. Thereupon the learned Junior Civil Judge, Kodada impounded the document treating it as an agreement of sale and directed the petitioner to pay a sum of Rs.2,35,896/-towards deficit stamp duty, 10 times penalty of Rs.21,450/-. It is also stated that dissatisfied by the said order, the petitioner filed an application under Section 38 (2) of the Act requesting the Court to send the document to the Registrar, Nalgonda for necessary orders. The trial Court was pleased to send the document to the Registrar, Nalgonda. It is also stated that dissatisfied by the said order, the petitioner filed an application under Section 38 (2) of the Act requesting the Court to send the document to the Registrar, Nalgonda for necessary orders. The trial Court was pleased to send the document to the Registrar, Nalgonda. By an order, dated 03.10.1998 in L.R.No.G1/4044/97 the District Registrar made an order and dissatisfied with the said order dated 03.10.1998 the petitioner filed Writ Petition No.30012 of 1998 on the file of this Court and the same was disposed of allowing the writ petition setting aside the impugned order of the first respondent dated 03.10.1998 and further, the first respondent was directed to adjudicate upon the issue and pass appropriate orders as to the amount of Stamp Duty and Penalty payable by the petitioner in respect of the disputed document within the specified period from the date of receipt of a copy of the order. 8. It is further stated that no notice had been issued before passing the order by the District Officer till on 08.06.2004. On 08.06.2004, the petitioner received an order No. 41/4044/97 dated 01.06.2004 wherein he was directed to pay Rs.2,34,850/-within a period of 15 days from the date of receipt of the copy of the order. It is also stated that dissatisfied with the order, dated 01.06.2004, the petitioner filed Writ Petition No. 10525 of 2004 before this Court and this Court by order, dated 07.09.2004 directed the petitioner to approach the first respondent within a period of two weeks from the date of receipt of a copy of the order and on his approaching the first respondent shall furnish a copy of the proceedings issued on 10.06.2004 after due acknowledgement of such furnishing of the proceedings and after the receipt of the said proceedings dated 10.06.2004 the petitioner can seek recourses from the appropriate forum seeking stay of collection of stamp duty within a period of three weeks thereafter. In spite of the specific direction by this Court, the Registrar made an order mechanically without hearing the same. In spite of the specific direction by this Court, the Registrar made an order mechanically without hearing the same. Then he filed Writ Petition No. 1609 of 2005 and by order, dated 11.06.2008 this Court was pleased to allowed the writ petition directing the respondent to adjudicate the issue afresh within a period of eight weeks from the date of receipt of a copy of the order after hearing the petitioner in person or through his counsel. 9. Subsequent to the passing of the said order, the Registrar was pleased to passed the following order:- "After examining all the facts of the representation of the petitioner I hereby determine the Stamp Duty on the consideration of Rs.1,95,000/- is Rs.11,700/- the penalty of 5 times i.e., Rs.58,500/- thus the total comes to Rs.70,200/-. The party is hereby directed to remit the amount of Rs.70,200/-to the following head of account and submit the original challan to add a certificate under section 400 of the Indian Stamp Act." 10. In the counter-affidavit filed by R1, it is stated that O.S.No.146 of 1992 on the file of the District Munsif, Kodada, Nalgonda District had been decreed and appeal preferred A.S.No.14 of 1989 on the file of the Senior Civil Judge, Suryapet had been allowed and aggrieved by the same, the petitioner had preferred the present second appeal. Further, specific stand had been taken that the application under Section 38 (2) of the Act has to be filed before the Court of first instance but not at the appellate stage. The agreement of sale had been denied and several further facts touching the merits had also been averred in the counter-affidavit. The delay also had been specifically pointed out and further it is stated that all the orders and the proceedings referred to had been obtained by the petitioner behind his back without impleading them and without notice to them. Further objections had been taken that the petitioner is also estopped by conduct and at the belated stage if the petitioner is permitted by granting the reliefs as prayed for in the application, the respondents would be put to serious loss. 11. Further objections had been taken that the petitioner is also estopped by conduct and at the belated stage if the petitioner is permitted by granting the reliefs as prayed for in the application, the respondents would be put to serious loss. 11. Section 38 of the Act dealing with the instruments impounded how dealt with, reads as hereunder:- (1) When the person impounding an instrument under section 33 has, by law of consent of parties authority to receive evidence and admits such instrument in evidence upon payment of a penalty as provided by Section 35 or of duty as provided by section 37, he shall send to the Collector an authenticated copy of such instrument, together with a certificate in writing, stating the amount of duty and penalty levied in respect thereof, and shall send such amount to the Collector, or to such person as he may appoint in this behalf. (2) In every other case, the person so impounding an instrument shall send it in original to the Collector." 12. Strong reliance was placed on Sub Section (2), which had been specified supra. 13. Section 40 of the Act dealing with Collector's power to stamp instrument impounded, reads as hereunder:- (1) When the Collector impounds any instrument under section 33, or receive any instrument sent to him under section 38, sub section (2), not being an instrument chargeable with a duty not exceeding ten naye paise only or a bill of exchange or promissory note, he shall adopt the following procedure:- (a) if he is of opinion that such instrument is duly stamped or is not chargeable with duty, he shall certify by endorsement thereon that it is duly stamped, or that it is not so chargeable, as the case may be; (b) if he is of opinion that such instrument is chargeable with duty and is not duly stamped, he shall require the payment of the proper duty or the amount required to make up the same, together with a penalty of five rupees; or, if he thinks fit, an amount not exceeding ten times the amount of the proper duty or of the deficient portion thereof, whether such amount exceeds or falls short of five rupees. 14. Chapter IV of the Act deals with instruments not duly stamped. Section 33 of the Act deals with examination and impounding of instruments. 14. Chapter IV of the Act deals with instruments not duly stamped. Section 33 of the Act deals with examination and impounding of instruments. Section 34 of the Act deals with special provision as to unstamped receipts. Section 35 of the Act deals with instruments not duly stamped inadmissible in evidence. Section 36 of the Act deals with Admission of instruments where not to be questioned. Section 37 of the Act deals with admission of improperly stamped instruments. 15. Strong reliance was placed on the decision of this Court reported in Y. PEDA VENKAYYA V. R.D.O. GUNTUR AIR 1981 Andhra Pradesh 274, wherein the learned Judge of this Court at paras 9, 10, 11 and 12 observed as hereunder:- "As pointed out by Ramachandra Raju, J., in B.V.R. Reddy v. Adoni Co-operative Central Stores Ltd., AIR 1975 Pra 96, the Court cannot compel a party, producing a document, to pay the duty and penalty as assessed by it and have the document admitted in evidence. It is for the party to choose whether to have the document admitted on payment of the duty and penalty as assessed by the Court, or to apply to the Court to send the document to the Collector under Sec.38. Once the document is sent to the Collector under S.38 (2), it has to be dealt with in accordance with Section 40, as already explained above. But, at the same time, I must clarify that a party who applies for sending the document to the collector under S.38 (2) cannot, at the same time, ask the Court to stay the trial of the suit pending decision of the collector under S.40. The Collector, no doubt, will send back the document under sub-section (3) of S. 40; but the Court need not stay the trial awaiting the orders/action of the Collector either under sub-Section (1) or sub-section (3) of S.40. I am, therefore, of the opinion that the Revenue Divisional Officer was in error in holding that he is not competent to decide the proper duty and penalty. If any, payable on the documents in question. He is obliged to do so under Cl.(b) of sub-section (1) of S.40 and, accordingly, he has to be directed to do so. Mr. I am, therefore, of the opinion that the Revenue Divisional Officer was in error in holding that he is not competent to decide the proper duty and penalty. If any, payable on the documents in question. He is obliged to do so under Cl.(b) of sub-section (1) of S.40 and, accordingly, he has to be directed to do so. Mr. A. Hanumantha Rao, the learned counsel for the 2nd respondent, relied upon a decision of this Court in Balaji Chit Fund v. B. Satyanarayana, (1967) 2 Andh WR 268, in support of his contention that once the Court determines the duty and penalty payable, the Collector cannot again go into the same question. But, I find that the said decision does not help the learned counsel in this case. That was a case where the duty and penalty was assessed and collected by the Court as contemplated by sub-section (1) of S.38. Subsequently, the Court-fee Examiner raised an objection that the document calls for further duty and penalty. The learned Munsif, thereupon, directed following a Full Bench decision of the Hyderabad High Court-that the document in original be sent, under S.38 (2) of the Act, to the Collector for adjudication by him in accordance with the provisions of the Act. It was that order which was challenged before this Court. The learned Judge held that, inasmuch as in the case of the document concerned therein, duty and penalty was assessed and collected as contemplated by sub-section (1) of S.38 and the document admitted in evidence, the Collector can have no power to go into the same question over again, though in his discretion he may grant a refund under Section 39 of the Act. In my opinion, the principle of the said decision has no application here. This is not a case where the plaintiff has paid the amount of duty and penalty as assessed by the Court, so as to attract sb-section (1) of Section 38. Unless the duty and penalty as determined by the Court is paid, sub-sec. (1) of S.38 is not attracted; and once subsection (1) is not attracted, it is sub-section (2), under which action has to be taken. The mere fact that before calling upon the party, the Court determines the duty and penalty payable, does not mean that sub-section (1) of S.38 is attracted. (1) of S.38 is not attracted; and once subsection (1) is not attracted, it is sub-section (2), under which action has to be taken. The mere fact that before calling upon the party, the Court determines the duty and penalty payable, does not mean that sub-section (1) of S.38 is attracted. Sub-section (1) will be attracted - as already indicated above-only where the party concerned pays the duty and penalty as determined by the Court and gets the document admitted in evidence. Since this has not been done in the present case, it is sub-section (2) of Section 38 that applies and, as a matter of fact, the original documents were also sent to the Collector in this case which necessarily means that the action taken was under Section 38 (2) alone. If so, the Collector has to proceed under S.40, and determine the duty and penalty, if any, payable on the documents, and take further steps as provided by S.40. The writ petition is, accordingly, allowed and the Revenue Divisional officer is directed to determine the nature of the documents and the duty and penalty, if any, payable thereon as contemplated by sub-section (1) of S.40, and after collecting the same, send the documents back to the Court, as contemplated by sub-section (3) of S.40. It is, however, made clear that the suit need not wait for the orders of the Collector (R.D.O.). Since the plaintiff has not chosen to pay the duty and penalty as determined by the Court and have the documents admitted in evidence, he is not entitled to seek the stay of the suit. The suit and other connected proceedings shall go on according to law, without waiting for the return of the documents from the Collector (R.D.O.). If, however, the documents are received from the R.D.O., as contemplated by sub-section (3) of S.40, before the disposal of the suit, they shall be dealt with and considered according to law, and subject to proof and relevancy." 16. Reliance also was placed on the decision of this Court reported in MANNARU PENCHALAIAH V. PATNAM VENKAMMA AIR 2008 Andhra Pradesh 253, wherein the learned Judge of this Court at paras 6 and 7 observed as hereunder:- "Chapter IV of the Indian Stamp Act, 1899 (for brevity "the Act) deals with instruments not duly stamped. Section 33 of the Act deals with examination and impounding of instruments. Section 33 of the Act deals with examination and impounding of instruments. Section 34 deals with special provision as to unstamped receipts. Section 35 deals with instruments not duly stamped inadmissible in evidence etc., Section 36 deals with admission of instruments, where not to be questioned. Section 37 deals with admission of improperly stamped instruments. Section 38 deals with instruments impounded how dealt with. Section 39 deals with Collector's power to refund penalty paid under Section 38 (1) and Section 40 deals with Collector's power to stamp instrument impounded. For the purpose of this case, it may be necessary to extract Section 35 (a) and 40 of the Act which are as follows:- Section 35)- Instruments not duly stamped inadmissible in evidence, etc.:-No instrument chargeable with duty shall be admitted in evidence for any purpose by any person having by law or consent or parties authority to receive evidence, or shall be acted upon, registered or authenticated by any such person or by any public officer, unless such instrument is duly stamped. Provided that--- a) any such instrument not being an instrument chargeable with a duty to twenty paise or a mortgage of crop (Article 36 (a) of Schedule 1-A) chargeable under Clause (aa) or (bb) of Section 3 with a duty of forty paise or a bill of exchange or promissory note, shall subject to all just exceptions, be admitted in evidence on payment of the duty with which the same is chargeable or, in the case of an instrument insufficiently stamped, of the amount required to make up such duty, together with a penalty of (fifteen rupees) or, when ten times the amount of the proper duty or deficient portion thereof exceeds (fifteen rupees) of a sum equal to ten times such duty or portion. Section 40:- Collector's power to stamp instrument impounded:-(1) When the Collector impounds any instrument under Section 33, or receives any instrument, sent to him under Section 38, sub-section (2) not being an instrument chargeable with a duty (of twenty paise only or a mortgage of a crop (Article 36 (a) of Schedule 1-A) chargeable under Clause (aa) or (bb) of Section 3 with a duty of forty paise) or a bill of exchange or promissory note he shall adopt the following procedure:- a) If he is of the opinion that such instrument is duly stamped or is not chargeable with duty, he shall certify by endorsement thereon that it is duly stamped, or that it is not so chargeable, as the case may be; b) If he is of opinion that such instrument is chargeable with duty and is not duly stamped, he shall require the payment of the proper duty or the amount required to make up the same, together, with a penalty of five rupees; or, if he thinks fit, an amount not exceeding ten times the amount of the proper duty or of the deficient portion thereof, whether such amount exceeds or fall short of five rupees. Provided that when such instrument has been impounded only because it has been written in contravention of Section 13 or Section 14, the Collector may, if he thinks fit, remit, the whole penalty prescribed by this Section. (2) Every certificate under Clause (a) of sub-section (1) shall, for the purposes of this Act, be conclusive evidence of the matters stated therein. (3) Where an instrument has been sent to the Collector under Section 38, sub-section (2), the Collector shall, when he has dealt with it as provided by this Section, return it to the impounding officer. There is no dispute that the alleged lease deed is inadmissible in evidence and hence, the petitioner is asking for impounding of the document and thus he filed the applications requesting the Court to send the document to the revenue official. When once there is an admission that a document requires stamp duty it is always open for the Court to accept the document together with penalty as contemplated under Section 35 (a) of Act and the Court has no discretion except to follow the provision scrupulously. When once there is an admission that a document requires stamp duty it is always open for the Court to accept the document together with penalty as contemplated under Section 35 (a) of Act and the Court has no discretion except to follow the provision scrupulously. But if such a document is sent to the Collector, the Collector is vested with the power of discretion and he may accept the same on payment of proper duty or the amount required to make up the same together with a penalty of Rs.5/-or if he thinks fit an amount not exceeding 10 times the amount of proper duty. When such a discretion is given to the Collector and the Court is helpless in exercising its discretion to collect only the amount required towards stamp duty with some penalty, it is always desirable that the document is sent to the Collector, so that the Collector may exercise his discretionary power and get the document impounded by accepting the actual amount required towards stamp duty. In fact, the petition itself is for sending the document to the Collector for the purpose of impounding the document i.e., lease deed. In the light of the above discussion, the view of the trial Court in dismissing the applications and directing the petitioner to pay the stamp duty and penalty on the lease agreement in the Court itself is wrong and therefore, orders dated 4.12.2007 made in both the impugned applications i.e., I.A.No.882 of 2007 in O.S.No.349 of 2002 and I.A.No.883 of 2007 in O.S.No.361 of 2002 are hereby set aside and the trial Court is hereby directed to send the lease agreement dated 5.1.2001 to the Collector so that the Collector may get the document impounded as contemplated under Section 40 of the Act. 17. Further reliance was placed on the decision of this Court reported in SALEEM BEE V. SYED ABDUL NAYEEM 2008 (5) ALD 513 wherein it was observed at paras 8 and 11 as hereunder:--- "The 4th defendant who made an attempt to mark the document had not preferred the CRP, but the plaintiff had carried the matter by way of CRP No. 1747/2007 and this Court by order dated 18. 7. 7. 2007 on the ground that such plaintiff is not an aggrieved party, was not inclined to interfere and dismissed the C. R. P. It is stated that the 4th defendant had not challenged the said order. Certain submissions were made relating to collusion between the petitioner/4th defendant and also the 1st respondent/plaintiff in the suit on the ground that these parties are sister and brother. This aspect need not detain this Court any further in deciding the merits and demerits of the present civil revision petition in the light of the order already made by the learned II additional Senior Civil Judge-Fast Track Court, Mahaboobnagar which had been already specified supra. It is pertinent to note that in the prior order, the learned judge specifically held that the selfsame document as inadmissible in evidence for want of registration and also on the ground of liability to pay the stamp duty. It is no doubt true that as far as the second ground is concerned, may be the petitioner is at liberty to pray for sending of the said document for the purpose of impounding in accordance with the provisions of the Indian stamp Act. But however, the other objection relating to the inadmissibility of the document in question for want of registration stands intact being undisturbed. The Counsel for revision petitioner placed strong reliance on the decision referred in Nalajala Jagannadham v. Veerepally Mangamma, ( 1997 (2) ALD 549 ) wherein the learned Judge at Para 7 observed: "from this it is clear that the authority impounding the instrument under Section 35 of the Act has to send the instrument to the collector an authenticated copy of the instrument with a certificate in writing stating the amount of duty and penalty levied in respect thereof and shall send the amount authorized officer collected to the collector, under Section 38 of the Act. In every other case the officer concerned after impounding shall send it in original to the collector who is expected to take action as contemplated under Section 40 of the Act. Under Section 39 of the Act it is made clear that when once the instrument is received by the Collector under Section 38 (1) of the act if he thinks fit he may refund any portion of the penalty in excess of Rs. 5/-which has been paid in respect of such instrument. Under Section 39 of the Act it is made clear that when once the instrument is received by the Collector under Section 38 (1) of the act if he thinks fit he may refund any portion of the penalty in excess of Rs. 5/-which has been paid in respect of such instrument. In fact under Section 39 (2) of the Act it is made clear that when once the instrument is received by the Collector under Section 38 (1) of the Act if he thinks fit he may refund any portion of the penalty in excess of Rs. 5/- which has been paid in respect of such instrument. In fact under section 39 (2) if the instrument is impounded because it was written in contravention of section 13 or 14, the Collector is empowered to refund the whole penalty so paid. From the language employed in Sections 31, 32, 39 and 40 of the Act, the ultimate power to decide the nature of the instrument and the stamp duty payable on such instrument rests with the Collector but no other authority. Even though a person incharge of public office is given the power to admit, the document in evidence by collecting the insufficient stamp duty and also levies penalty under Section 35 (a) of the Act. It is only a provisional order and the said authority has to send it to the Collector for final assessment of the value of the stamp duty payable on the instrument and pass either of the orders contemplated under section 39 or Section 40 of the Act The words used in Section 35 "any person having, by law or consent of parties, "authority to receive evidence" and the words used in Section 38 "when the person impounding any instrument in Section 33 has", by law or consent of the parties, authority to receive evidence or admits such instrument in evidence" gives an impression that he can impound the document himself with the consent of the parties but not otherwise before admitting the same in evidence or he can forward the same to the collector who is the ultimate authority under the Act to decide the nature of the document and duty to be paid thereon with or without penalty. I am fortified in my view in the light of the language used in Section 38 (2)of the Act which says in every other case the person so impounding an instrument shall send it in original to the Collector. Though under Section 35 (a) a power is given to the person incharge of public office who is given authority to admit the document in evidence by collecting the proper stamp duty and also by levying penalty for purpose of admitting the instrument in evidence. If the parties have not consented for deciding the nature of the instrument and the stamp duty payable thereon and the penalty to be levied by the person incharge holding public office he shall simply forward the same to the Collector for impounding the document". Here is a case where the learned judge, when an attempt was made to mark the selfsame document, had made an order holding that the said document is inadmissible in evidence for want of registration and also on the ground of liability of stamp duty and penalty. Inasmuch as the first ground of attack that the document is inadmissible in evidence for want of registration when the said order made in a way had attained finality, sending the selfsame document for the purpose of impounding to the District Collector would be a futile exercise since the same cannot be marked on the ground of want of registration in the light of the prior order already referred to above. In the light of the same, the impugned order does not suffer from any legal infirmity. It is needless to say that if the petitioner is aggrieved of that portion of the order holding the document as inadmissible for want of registration, liberty is given to the petitioner to question the same by way of appropriate proceedings. 18. It is needles to say that the decision reported in Saleem Bee's case (3 supra) is distinguishable on facts. 19. Section 107 (2) of the Code specifies as hereunder:- "subject as aforesaid, the Appellate Court shall have the same powers and shall perform as nearly as may be the same duties as are conferred and imposed by this Code on Courts of original jurisdiction in respect of suits instituted therein." 20. It is no doubt true that there is some delay on the part of the petitioner. It is no doubt true that there is some delay on the part of the petitioner. But however, on a careful analysis of the series of events, may be that because the Appellate Court had reversed the decree and judgment of the Court of first instance and allowed the appeal, the petitioner had chosen to file the present application at this stage i.e., in the present second appeal. It is no doubt true that normally marking of the documents would be before the trial Court, but for certain exceptions. It is needless to say that the first appeal or the second appeal, are continuation of the original proceedings i.e., the original suit. This Court is not inclined to express any opinion relating to the other aspects. But however, in the light of the facts and circumstances, which had been well explained, this Court is of the considered opinion that though the application had been filed at a belated stage, the petitioner to be permitted to pay the stamp duty and penalty. 21. Hence, the petition ishereby allowed. The parties to bear their own costs.