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2023 DIGILAW 71 (AP)

Gonipati Lakshmi Rajyam (Died) v. Kondepudi Bhaskara Rama Rao S/o Kondepudi Venkata Narasimha Rao

2023-01-06

SUBBA REDDY SATTI

body2023
ORDER : 1. Plaintiffs in the suit filed the above revision against the order dated 08.11.2022 in O.S. No. 497 of 2015 on the file of II Additional Senior Civil Judge, Rajamahendravaram. 2. Suit O.S. No. 497 of 2015 was filed by plaintiffs against the defendants seeking specific performance of agreement of sale dated 15.11.2010 or in alternative for refund of advance amount with interest etc. 3. Defendants by filing written statement are contesting the suit. 4. In the agreement of sale dated 15.11.2010 relied upon by the plaintiffs, it was recited that the schedule property has been in possession of the vendee from 1987. The said document was sought to be marked before the Court. Trial Court by order dated 08.11.2022 came to the conclusion that document dated 15.11.2010 is liable for stamp duty and penalty and hence, the same cannot be marked. Aggrieved by the same, the above revision is filed. 5. Sri A. Ravindra Babu, learned counsel for petitioners’ would submit that no delivery of property was effected under the agreement and hence, stamp duty and penalty need not be paid under Schedule I-A of Article 47-A of the Stamp Act, 1899. He would also submit that trial Court failed to consider the said aspect and erroneously directed the petitioners to pay the stamp duty and penalty and thus, prayed to set aside the order of trial Court. 6. Now, the point for consideration is: Whether the document dated 15.11.2010 requires stamp duty under Schedule I-A of Article 47-A of the Stamp Act, 1899? 7. It is appropriate to extract the explanation to Schedule I-A of Article 47-A of the Stamp Act, 1899, which reads as follows: “Explanation-I: An agreement to sell followed by or evidencing delivery of possession of the property agreed to be sold shall be chargeable as a “sale” under this article: Provided that, where subsequently a sale deed is executed in pursuance of an agreement of sale as aforesaid or in pursuance of an agreement referred to in clause (B) of Article 6, the stamp duty, if any, already paid or recovered on the agreement of sale shall be adjusted towards the total duty leviable on the sale deed.” 8. The Division Bench of the composite High Court of Andhra Pradesh in B. Ratnamala vs. G. Rudramma, AIR 2000 A.P. 167 : 1999 (6) ALT 59 while answering reference held thus: “9. The Division Bench of the composite High Court of Andhra Pradesh in B. Ratnamala vs. G. Rudramma, AIR 2000 A.P. 167 : 1999 (6) ALT 59 while answering reference held thus: “9. While considering the provisions of the Indian Stamp Act, it has to be borne in mind that the said Act being a fiscal statute, plain language of the section as per its natural meaning is the true guide. No inferences, analogies or any presumptions can have any place. As the incidence of duty is on the execution of the deed, regard must, therefore, be had only to the terms of the document. Thus the main question that falls for consideration is the interpretation of the expressions “followed by or evidencing delivery of possession.” These expressions cannot be read in isolation and one has to find the true meaning by reading the entire Explanation and more so in conjunction with the earlier expression i.e. “agreement.” Even if these two expressions are looked independently, it means an agreement to sell followed by delivery of possession and an agreement to sell evidencing delivery of possession. In the first case, i.e. “followed by delivery” possession cannot be disjuncted from the basic source i.e. agreement to sell. Therefore, the expression followed by delivery of possession should have a direct nexus to the agreement and should be read in juxtaposition to the word ‘agreement’ and it cannot be independent or outside the agreement. Therefore, the delivery of possession should follow the agreement i.e. through the agreement. It takes in its sweep the recital in the agreement itself that delivery of possession is being handed over. It will also cover cases of delivery of possession contemporaneous with the execution of agreement, even if there is no specific recital in the agreement. In other words, the delivery of possession should be intimately and inextricably connected with the agreement. And in the second type, i.e. agreements evidencing delivery of possession, if the document contains evidence of delivery of possession by a recital in that behalf, that is sufficient. Such delivery of possession can be prior to the date of agreement and need not be under the agreement. If the Agreement records the fact that the possession was delivered earlier and such recital serves as evidence of delivery of possession, though prior to the Agreement, it falls under the second limb. Such delivery of possession can be prior to the date of agreement and need not be under the agreement. If the Agreement records the fact that the possession was delivered earlier and such recital serves as evidence of delivery of possession, though prior to the Agreement, it falls under the second limb. Therefore, on a proper interpretation of the said expressions, it would follow that an agreement containing specific recital of delivery of possession or indicating delivery of possession even in the past is liable for stamp duty as a ‘sale’ under the said Explanation. 11. Mohd. Gafoor (supra) is a case where an agreement was executed with the tenant in possession wherein it was contemplated that the purchaser (the tenant) can retain the possession and further authorized to collect the rents for himself and sublet the premises. In that context, the learned Judge held that there is no delivery of possession of property under the agreement. To put it differently, possession has not followed the agreement and it does not evidence delivery of possession. Before the learned single Judge, neither of the decisions in Mekapothula Linga Reddy (supra) and D. Ramachandra Rao (supra) were cited. No doubt, the twin situations contemplated under the explanation I were kept in view but however, on the facts, the learned Judge came to the conclusion that there is no delivery of possession as the person in possession continued to remain therein. Basically, the learned Judge has not taken into consideration the incidence of agreement and the change in the jural relationship between the parties. Earlier, the parties were having the relationship of landlord and tenant and under the agreement, the relationship has transformed in to that of a vendor and purchaser. Thus, there is a total novation of not only the situation, but also the relationship and the respective rights and obligations. Even though the parties remain in the same position, the nature of their relationship can be altered. In Mohd. Gafoor (supra), certainly the tenant has catapulted into a purchaser. Even though there may not be a redelivery of possession as a tenant and again delivery back to the same person as a purchaser, but the factum of change of relationship certainly leads to the inference of a change in the nature of possession, even if it were to be taken as a symbolic delivery. Even though there may not be a redelivery of possession as a tenant and again delivery back to the same person as a purchaser, but the factum of change of relationship certainly leads to the inference of a change in the nature of possession, even if it were to be taken as a symbolic delivery. Therefore, it cannot be said that simply because one continued to remain in possession, though in different capacities, there is non-delivery of possession. A symbolic delivery may also amount to actual delivery in given circumstances. Thus in the case in Mohd. Gafoor (supra), there was delivery of possession and the said explanation gets attracted.” 9. Eventually, the Division Bench came to the conclusion that delivery of possession before the execution or at the time of execution or after the execution of an agreement and such agreements are deemed to be conveyances for the purpose of imposing stamp duty. 10. As discussed supra, in the case on hand, there is specific recital in the agreement that vendee is in possession of the property on the date of agreement of sale. While deciding the question relating to payment of stamp duty and penalty on a particular document, the recitals of the document may have to be looked into and not the pleadings of the respective parties. The pleadings of the parties may be in deviation of the document in question. The levy of the stamp duty and penalty is always in relation to the document which is to be marked before the Court and such levy cannot depend upon the pleadings of the parties. 11. In view of specific recital in the agreement of sale dated 15.11.2010 with regard to possession over the schedule property and in view of the ratio in Ratnamala’s case, this Court does not find any illegality in the order passed by the Court below warranting interference of this Court under Article 227 of the Constitution of India. 12. Accordingly, the Civil Revision Petition is dismissed at admission stage. No costs. 13. As a sequel, all the pending miscellaneous applications shall stand closed.