Abdul Khaliq Ansari vs Farkunda and Others

S. Sujatha, J.—In these writ petitions, the orders passed by the learned I Addl. Senior Civil Judge in O.S. No. 313/08 dated 13.11.2013 and 11.12.2013 is called in question by the plaintiff/petitioner.

For the sake of convenience, the parties herein are referred to as per their rank in the trial Court.

The plaintiff filed O.S. No. 313/08 for specific performance for enforcement of agreement of sale dated 05.02.2007. Defendants filed detailed written statement resisting the suit. Defendants 3 and 4 filed an interlocutory application under Order VII Rule 11 read with Section 151 of CPC seeking for rejection of the plaint on the ground that the agreement of sale dated 05.02.2007 is insufficiently stamped to which the plaintiff filed his statement of objections. The trial Court after considering the rival arguments of the parties, directed the registry to calculate the duty and penalty on the agreement of sale dated 5.2.2007 by an order dated 13.11.2013 and 11.12.2013. The orders passed by the trial Court are under challenge in these writ petitions.

The learned counsel appearing for the plaintiff submitted that in reply to the interlocutory application filed by the defendant Nos. 3 and 4, it was admitted that the plaintiff is liable to pay the duty and penalty for the deficit duty but the same is not payable at this stage as per Section 33 of Karnataka Stamp Act. In support of his contention, he placed reliance on the following judgments:

(1) Dr. S. Vidhya Vs. Sri R.S. Venakata Reddy,

(2) Shri S. Suresh Vs. Shri L. Pothe Gowda and Others,

Per contra, learned counsel appearing for the defendants contended that plaintiff having accepted that he is ready to pay the duty and penalty as directed to pay, cannot turn round and challenge the order of the trial Court which is passed on the admission made by the plaintiff and sought for dismissal of the writ petition.

The learned Civil Judge after accepting the objections filed by the plaintiff to the I.A. on 23.10.2013 stating that he is ready to pay the duty and penalty as directed by the Court, issued directions to the office to calculate the duty and penalty on the agreement dated 5.2.2007 produced by the plaintiff and the matter was adjourned to 11.12.2013. Since the office has not complied the order dated 13.11.2013, an order was passed on 11.12.2013 directing the office to calculate the duty and penalty. Subsequently, on several hearing dates, the learned counsel appearing for the plaintiff sought time for payment of duty and penalty. The learned counsel for the plaintiff filed I.A. No. 14 under Section 151 CPC on 28.6.2014 to recall the order dated 11.12.2013 and 13.11.2013 to file objections to the calculations made by the office. Despite the registry having made the calculation of duty and penalty on 11.3.2014, the plaintiff having failed to make the payment as admitted, filed I.A. No. 14 seeking permission to file objections to office calculations.

The conduct of the plaintiff establishes that this writ petition is filed only to protract the proceedings and the legal grounds now urged by the learned counsel for the plaintiff that Section 33 of the Karnataka Stamp Act provides only for impounding of the instruments not duly stamped and the plaintiff, at this stage is not liable to pay deficit duty and penalty on the agreement not sufficiently stamped is wholly untenable. The order passed by the learned Civil Judge on 28.06.2014 reads as under:

"KVS files I.A. 14 U/S. 151 CPC to Recall the Order Dated 9/4, 22/4, 23/6, 24/6/14 and to file Objections to Office Calculation. Perused K.P. For D - 2 and MH for D-3 and 4 submits that Plaintiff has to pay duty and penalty. Sufficient opportunity has been given to Plaintiff to pay duty and penalty. The Office has made calculation on 11.3.2014 and after 4 adjournments now the present application is filed. It is only to drag on the proceedings. Hence I.A. 14 is rejected. Agreement Dated 5.2.2007 produced by the Plaintiff shall not be taken in evidence as duty and penalty is not paid".

This order dated 28.06.2014 clarifies that agreement dated 05.02.2007 produced by the plaintiff shall not be taken in evidence as duty and penalty is not paid which is in conformity with the provisions of the Karnataka Stamp Act. The provisions of Section 33 of the Karnataka Stamp Act shall not absolve the plaintiff from making the payment of deficit duty and penalty.

The suit is of the year 2008 filed for specific performance to enforce the agreement dated 5.2.2007 and it is an admitted fact that the plaintiff has agreed to pay the deficit duty and penalty on the said agreement, the impugned order challenged herein being passed on such admission made by the plaintiff, cannot be found fault with. Plaintiff having agreed to pay the duty and penalty, cannot turn back and question the same as erroneous. The plaintiff cannot approbate and reprobate at the same time. In the circumstances, the judgments relied upon by the plaintiff are not applicable to the facts of the case.

The Division Bench of this Hon''ble Court in the case of Miss. Sandra Lesley Anna Bartels Vs. Miss. P. Gunavathy, has held as follows:

Court cannot say that it would impound the document only when the document is tendered in evidence for marking. There may be instances where duty and penalty payable may be very high and the party may not choose to rely upon such insufficiently stamped document in order to avoid stamp duty and penalty. In such circumstances, it would result in loss of revenue to the exchequer. The power of impounding a document is to collect stamp duty and penalty whenever there is an escape of duty. Therefore, when it is brought to the notice of the Court that a document is insufficiently stamped, the Court exercising its power under Section 33 of the Act has to pass an order at the first instance for impounding the document. Though there is a discretion vested in the Court to exercise powers under Sections 33 and 34 of the Act, no Court can hold that it would wait till the document is tendered in evidence. The such circumstances, there may be chances of loss of revenue to the exchequer.

In the circumstances, we answer the reference "holding the under Section 33 of the Stamp Act, the moment an insufficiently stamped instrument comes to the notice of the Court, the same has to be impounded in accordance with Section 33 , whether the same would be relied upon by the party under Section 34 or not".

The said judgment is squarely applicable to the facts of the present case. Accordingly, the impugned order challenged herein has to be upheld. The writ petitions being devoid of merits are accordingly dismissed.