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2010 DIGILAW 1067 (KAR)

P. S. Thotappa v. Siddamallikarjuna Swamy

2010-10-06

ANAND BYRAREDDY

body2010
Judgment :- Heard the counsel for the parties. 2. The facts are as follows: The petitioner is the plaintiff in a pending suit for specific performance of an agreement of sale. The agreement is dated 31.3.1996. It is in respect of agricultural land measuring 2 acres and 2 guntas in Sy.No. 92/2 of Vadeyandalli, T. Narsipur Taluk. The petitioner is the purchaser. At the trial, the agreement of sale 8.2.1997 was marked as an exhibit in evidence, as Ex.P1. Along with the agreement, a receipt for having received a sum of Rs. 1 lakh and having deposited documents of title to the above property as security for repayment of the same within six months, executed by the defendant, dated: 31.3.1996 was also marked as Ex.P2. The defendant had thereafter filed an application under Sections 33 and 34 of the Karnataka Stamp Act, 1957, seeking that the document at Ex.P2 be impounded, as it was not duly stamped and to impose duty and penalty. That application was rejected. The same had been challenged by way of a Writ petition in WP 10461/2006 before this court, the petition was allowed and the trial court was directed to reconsider the matter. Pursuant to which the present impugned order is passed. The trial court has held that though Ex.P2 was the earlier document and inspite of reference to it in Ex.P1 and the same having been executed pursuant to Ex.P2, and further, notwithstanding that duty and penalty had been collected by the court on Ex.P1, the two documents were to be viewed independently and therefore Ex.P2 which was clearly a Bond, to repay amounts borrowed, attracted stamp duty and penalty. It is this which is under challenge in the present writ petition. It is contended that though there are two documents namely, Ex.P2 being the first executed by the defendant to repay money borrowed and having offered documents of title as security for such repayment, the same having been superseded by the Agreement of Sale, which does contain a recital that the defendant is unable to repay the money borrowed under Ex.P2 and hence the transaction be treated as an agreement of sale of the property offered as security, was indeed one transaction. The court having already collected duty and penalty on the Agreement of Sale on the entire consideration including the amount shown in Ex.P2, the impugned order would result in a duplication of payment of duty and hence the order impugned ought to be set aside. The learned counsel for the respondent however, seeks to justify the impugned order. Section 4 read with Section 5 of the Karnataka Stamp Act, 1957 would indicate that Ex.P2 did not attract any stamp duty on the amount indicated therein as the said amount was also reflected in Ex.P1 and duty and penalty was imposed and collected by the Court on Ex.P1. Sections 4 and 5 are extracted for ready reference: “4. Several instruments used in single transaction of sale, mortgage or settlement: (1) Where, in the case of any sale, mortgage or settlement, several instruments are employed for completing the transaction, the principal instrument only shall be chargeable with the duty prescribed in the Schedule for the conveyance, mortgage or settlement, and each of the other instruments shall be chargeable with a duty of (one hundred) instead of the duty (if any) prescribed for it in the Schedule. (2) The Parties may determine for themselves which of the instruments so employed shall, for the purpose of sub-section (1), be deemed to be the principal instrument. Provided that the duty chargeable on the instrument so determined shall be the highest duty which would be chargeable in respect of any of the said instruments employed. 5. Instruments relating to several distinct matters. – Any instrument comprising or relating to several distinct matters shall be chargeable with the aggregate amount of the duties with which separate instruments, each comprising or relating to one of such matters, would be chargeable under this Act.” Therefore, whether Ex.P2 is treated as a Bond or An agreement for deposit of title deeds, would be wholly immaterial. As the stamp duty is sought to be levied on the consideration amount, which is included in Ex.P1 – it is that document which would now be the principal transition and therefore may be treated as a transaction of sale for purposes of Section 4. In the alternative, if the two documents are treated as independent transactions, Section 5 could be applied and the duty and penalty already paid should be adequate to absolve the petitioner of any liability. In the alternative, if the two documents are treated as independent transactions, Section 5 could be applied and the duty and penalty already paid should be adequate to absolve the petitioner of any liability. This aspect alone requires to be ascertained by the trial court. The impugned order however is not tenable. The Writ Petition is allowed and the impugned order is quashed.