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2016 DIGILAW 336 (KAR)

Y. Sharanappa v. Balasu Subramanyam

2016-04-06

B.S.PATIL

body2016
ORDER : B.S. Patil, J. Petitioner is defendant 1 in O.S. No. 10 of 2009. The said suit has been filed by respondents 1 and 2 herein seeking specific performance of the agreement to sell executed by defendant 1 on 13-7-2007. As per the said agreement, 3 acres of land has been agreed to be sold in favour of plaintiffs for sale consideration of Rs.55,11,000/-. An amount of Rs.2,01,000/- was paid on the date of agreement. A sum of Rs.28,00,000/- was required to be paid on 31-7-2007. 2. The parties further agreed that the Mill which was in existence in a portion of the property had to be put in possession of plaintiffs on 1-8-2007. Sale deed was agreed to be executed on 25-8-2007, on which date balance sale consideration had to be paid. This document was sought to be marked in the evidence of P.W. 1. 3. Defendants objected stating that the document was not properly stamped. According to defendants, as the property had been agreed to be put in possession of the purchaser before execution of the sale deed, Article 5(e)(i) of the Karnataka Stamp Act, 1957 was applicable, therefore, stamp duty payable on a conveyance, calculated on the market value of the property ought to have been paid. It was urged that as the document was not sufficiently stamped, the deficit stamp duty had to be paid along with penalty. 4. The Court below has partly accepted the contention urged by the petitioner and has directed the plaintiffs to furnish the market value of the Till which was in existence on a portion of the suit property by order dated 5-7-2010. On 13-6-2011, application filed by plaintiffs in I.A. No. 7 was flowed by the Court below appointing a Civil Engineer to furnish the value of the building. A technically qualified person has been ordered to be appointed for ascertaining the market value of the machinery and its accessories attached to the Mill. This order, which is consequential to the order dated 5-7-2010, is also called in question in this petition. 5. I have heard the learned Counsel for both parties. The entire suit schedule property measures 3 acres. As per the agreement, entire property is not agreed to be put in possession of the purchaser-plaintiffs before the date of execution of the sale deed. 5. I have heard the learned Counsel for both parties. The entire suit schedule property measures 3 acres. As per the agreement, entire property is not agreed to be put in possession of the purchaser-plaintiffs before the date of execution of the sale deed. Only the Mill located on the property has been agreed to be put in possession of the purchaser before the date of execution of the sale deed. Therefore, as per Article 5(e)(i) statutory requirement is that, if the agreement of sale is with regard to sale of immovable property wherein, as part performance of contract possession of "the property" is delivered or is agreed to be delivered without executing the conveyance, then the same duty as on a conveyance has to be paid on the market value of "the property". 6. It is true, the provision does not make any reference to a situation where "the property" that is to be delivered to the purchaser is not whole of the property, but is only a part. In such a situation, it cannot be said that, even if any part of the property is delivered it would be sufficient to attract the provision under Article 5(e)(i) to demand payment of stamp duty and penalty in respect of the market value of the entire property. 7. The essential ingredient for applying the provision contained in Article 5(e)(i) of the Karnataka Stamp Act, 1957, is delivery of possession or agreement to deliver possession before execution of the conveyance. In case agreement between the parties is to deliver possession of part of the property only and rest of the property continues in possession of the vendor till the deed conveyance was executed, then it has to been held that only in respect of that part in respect whereof possession was delivered or agreed to be delivered, stamp duty as provided for a conveyance has to be paid on the market value of that part. Any other interpretation will not advance the intention of the Legislature, but, would tantamount to straining the language used by the Legislature so as to burden the party concerned with the obligation to pay not only stamp duty but also penalty in respect of the portion of property which the agreement holder has not come in possession or would not come in possession before sale deed was executed. Hence, in my view, order passed by the Court below does not warrant interference. 8. Consequently, the other order passed appointing the Court Commissioner to ascertain the value of the Mill and the machinery which are located in the Mill to enable the Court to find out the deficit stamp duty that was required to be paid by the plaintiff cannot be also found fault with. Hence, writ petitions are dismissed.