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2020 DIGILAW 713 (AP)

Chunduru Abbaiah v. Garlapati Satyanarayana

2020-11-11

BATTU DEVANAND

body2020
JUDGMENT Battu Devanand, J. - This Civil Revision Petition is directed against the order, dated 29.08.2019, passed in E.A.No.45 of 2019 in E.P.No.97 of 2012 in O.S.No.227 of 2009, on the file of the Additional Senior Civil Judge at Eluru. 2. The parties hereinafter will be referred to as arrayed in the Court below. The petitioner is claim petitioner, 1st respondent is plaintiff/Decree Holder and the respondents 2 to 4 are defendants/Judgment Debtors 1 to 3 in the suit proceedings. 3. Heard Sri K.B. Ramanna Dora, learned counsel for the claim petitioner and Sri A. Sai Rohit, learned counsel representing Sri M. Panduranga Rao, learned counsel for the plaintiff/Decree Holder. 4. Learned counsel for the claim petitioner submits that the claim petitioner filed the claim petition to declare him as absolute owner/bona fide purchaser of the E.P. schedule property. Learned counsel submits that even though the claim petition is filed to declare that the claim petitioner is the absolute owner/bona fide purchaser of the E.P. schedule property and to raise the attachment of the E.P. schedule property but in the evidence he has sought the relief of only raising attachment of the E.P. schedule property and has not sought the relief of declaration. Learned counsel further submits that since the relief of declaration is not sought and only sought to raise the attachment over the petition schedule property, non-possessory agreement for sale, dated 15.05.2007 can be marked. 5. Learned counsel for the claim petitioner contends that when the non-possessory document has come up for marking and that part payment had been done and possession was to be delivered only at the time of execution, as such, not exhibiting the document as evidence because the petitioner did not pay the stamp duty and penalty is unsustainable under law. 6. Learned counsel submits that the Court below erroneously held that the non-possessory agreement of sale cannot be received as evidence contrary to the settled law. 7. On the other hand, the learned counsel for the plaintiff contends that the non-possessory agreement for sale was reduced into writing on a stamp paper worth Rs.100/- and it is not a registered one and the same cannot be received as evidence as it suffers from stamp duty and incurable defect of registration. He submits that the trial court rightly taken a decision that the non-possessory agreement of sale cannot be received as evidence. 8. He submits that the trial court rightly taken a decision that the non-possessory agreement of sale cannot be received as evidence. 8. On perusal of the impugned order, it appears that the main E.P. is filed under Order XXI Rules 64 to 66 of C.P.C. by the plaintiff against defendant Nos.1 to 3 to bring the E.P. schedule property for sale in auction for realization of the E.P. amount. It appears, admittedly, E.P. schedule property was already attached in the main suit by the Decree Holder against the Judgment Debtors in an application filed under Order XXXVIII Rule 5 of C.P.C., on 21.05.2009. The suit was decreed on 15.09.2011. The sale was conducted on 24.04.2014. 9. Subsequently, the claim petitioner filed an application under Order XXI Rule 58 of C.P.C. praying to declare the petitioner as the absolute owner/bonafide purchaser of the petition schedule property and raised the attachment over the petition schedule property. This application was initially returned by the Court below. The petitioner approached this High court by filing C.R.P.No.1419 of 2014 which was allowed on 13.11.2018 and subsequently, the application filed by the petitioner was numbered by the Court below. The petitioner was examined himself as PW.1. When PW.1 intended to mark the non-possessory agreement of sale as exhibit, the learned counsel for the 1st respondent objected the same as it suffers from registration. 10. The Court below having considered the rival contentions and Sections 17 and 49 of Registration Act, held that the non-possessory agreement of sale cannot be received as evidence. Against the order of the Court below, the present revision petition is filed. 11. It appears that the agreement of sale, dated 15.05.2007 said to be executed by Kambampati Narayana Rao in favour of the petitioner. The said Kambampati Narayana Rao is no other than the 3rd defendant in the suit. The property covered under the agreement of sale and the schedule property in E.P. is one and the same. As per the recitals of the said sale deed, dated 15.05.2007 the total consideration mentioned in the said document is Rs.6,00,000/- and the said document is reduced to writing on the stamp paper worth of Rs.100/-. The property covered under the agreement of sale and the schedule property in E.P. is one and the same. As per the recitals of the said sale deed, dated 15.05.2007 the total consideration mentioned in the said document is Rs.6,00,000/- and the said document is reduced to writing on the stamp paper worth of Rs.100/-. As on the date of the execution of the sale agreement, the petitioner paid Rs.2,00,000/- out of Rs.6,00,000/- towards advance sale consideration and it is agreed to ay Rs.2,00,000/- on or before 15.12.2017 and the remaining sale consideration of Rs.2,00,000/- shall be paid on or before 05.05.2008. The said agreement of sale further discloses that Rs.1,50,000/- was paid on 15.12.2007, Rs.50,000/- was paid on 11.02.2008, Rs.50,000/- was paid on 05.05.2008, Rs.50,000/- was paid on 10.10.2009, Rs.40,000/- was paid on 01.08.2010 and Rs.50,000/- was paid on 02.10.2011 and it was also endorsed that an amount of Rs.10,000/- is yet to be paid and the 3rd defendant agreed to receive the remaining balance of sale consideration of Rs.10,000/- at the time of registration of the sale deed and possession will be delivered only at the time of execution of the registered sale deed by vacating the tenant. 12. As seen from the recitals of the agreement of sale, dated 15.05.2007, it clearly shows that possession was not delivered and as such, it is a non-possessory agreement of sale, dated 15.05.2007. In the opinion of this Court the recitals therein in the agreement of sale shall govern the issue. In the present case the agreement to sale clearly proves payment of a part of the consideration and after payment of balance sale consideration only the sale deed will be executed and the actual physical possession will be given to the purchaser by the seller. 13. It is settled law that the agreement of sale in question does not fall within the scope of Explanation I to Article 47-A of Schedule I of the Indian Stamp Act, 1899, thus impounding of such document does not arise. 14. The High Court of Andhra Pradesh in Makineni Srinivas Rao and others v. Manthena Prabhakar Reddy, (2014) 6 ALD 261 has an occasion to consider the scope of Explanation I of Article 47-A of Schedule I-A of the Indian Stamp Act, 1899 and opined at para Nos.7 to 11 as extracted hereunder: 7. 14. The High Court of Andhra Pradesh in Makineni Srinivas Rao and others v. Manthena Prabhakar Reddy, (2014) 6 ALD 261 has an occasion to consider the scope of Explanation I of Article 47-A of Schedule I-A of the Indian Stamp Act, 1899 and opined at para Nos.7 to 11 as extracted hereunder: 7. Explanation I of Article 47-A of Schedule I-A of the Act envisages that an agreement to sell followed by or evidencing delivery of possession of the property agreed to be sold shall be chargeable as a "Sale". In the opinion of this Court, the words "followed by or evidencing delivery of possession of the property" shall be construed to mean that delivery of possession shall be concurrent with or immediately after the execution of agreement of sale and the said provision does not attract a case where delivery of possession takes place long time after the execution of the agreement of sale. The words "followed by or evidencing delivery of possession" in Explanation I fell for consideration of a Division Bench of this Court in B. Ratnamala v. G. Rudramma (2),1999 6 ALT 159 : 1999 (6) ALD 160 . While reading the two phrases viz., "followed by" and "evidencing" separately, the Bench held that in the former case, even in the absence of a recital in the agreement, the delivery must be contemporaneous with the execution of agreement and that possession should be intimately and inextricably connected with the agreement. In the latter case, it held that in order to attract this explanation, the agreement must contain a recital of delivery of possession either prior to or after the agreement. 8. On a careful reading of Explanation I and the Division Bench judgment in B. Ratnamala (2 supra), I am of the opinion that in cases where the agreement does not contain the recital of delivery of possession, it must be examined whether possession "followed" the agreement. What precisely is the meaning of the word 'followed'? The Oxford dictionary, Thesaurus and Word power guide (Indian edition 2007) explained the meaning of the word 'follow' as "move or travel behind" "go along" "come after in time or order" "be a logical consequence of" "(follow through) continue (an action or task) to its conclusion". 9. What precisely is the meaning of the word 'followed'? The Oxford dictionary, Thesaurus and Word power guide (Indian edition 2007) explained the meaning of the word 'follow' as "move or travel behind" "go along" "come after in time or order" "be a logical consequence of" "(follow through) continue (an action or task) to its conclusion". 9. Thus, in the absence of express recital in the agreement on delivery of possession, in order to levy stamp duty chargeable to conveyance in respect of an agreement of sale, it must be shown that possession 'followed' as a logical consequence of the agreement. As explained by the Apex Court in Veena Hansmukh Jain v. State of Maharashtra (3), (1999) 1 SCR 302 , by introducing Explanation I, the legislature intended that the stamp duty as applicable to conveyance shall be collected in advance where delivery of possession was involved at the agreement stage itself and execution of conveyance deed remains a mere formality. 10. Where the agreement does not contain the recital relating to possession, what needs to be seen is whether delivery of possession was in contemplation of the parties at the time of execution of the agreement itself. This can be ascertained with reference to the point of time of such delivery. If delivery is simultaneous to or concurrent or contemporaneous with the execution of agreement of sale, it can be safely concluded that the parties have intended delivery of possession though such a recital is absent in the agreement. If on the contrary there is a reasonable time lag between execution of agreement and delivery of possession, it cannot be construed that such delivery 'followed' the agreement. At best it amounts to delivery of possession "in pursuance of" and not 'following' the agreement of sale. 11. In my opinion, the legislature has consciously used the restrictive expression "followed" by preceding the words "An agreement to sell" in Explanation I. It has not used the expansive words such as "in pursuance of" for it evidently wanted levying and collection of stamp duty chargeable for conveyances only in cases where parties to agreement of sale intended delivery of possession at the agreement stage itself without waiting for execution of regular conveyance deed. It is trite that provisions of a fiscal statute need to be strictly construed. 15. It is trite that provisions of a fiscal statute need to be strictly construed. 15. This Court in Chebrolu SrinivasaRao and others v. Ravi Venkata Ratna Vara Prasad and others, 2019 1 ALD 90 held at para No.18 as under: 18. Therefore the decision on payment of required stamp duty on suit agreement is to be decided by reference to the very recitals in the agreement but not the pleadings. The ratio of Apex Court and this Court in the decisions referred to above lays down the binding principles. 16. Keeping in view of the above decisions, the order under revision is set aside. The Civil Revision Petition is allowed accordingly. No order as to costs. As a sequel, miscellaneous petitions, if any, pending in this petition shall stand closed.