Case Note & Summary
The Supreme Court disposed of an appeal against an order of the Orissa High Court which had dismissed the appellants' petition under Article 227 of the Constitution. The appellants, defendants in a partition suit, had filed an application under Order XIII Rule 8 of the Code of Civil Procedure, 1908 to impound two power of attorneys (Exts. 4 and 5) produced by the plaintiffs' power of attorney holder (PW-1) during cross-examination. The appellants contended that under the Orissa amendment to the Indian Stamp Act, 1899 (Orissa Act No. 1 of 2003), a power of attorney transferring possession of immovable property is deemed to be a conveyance and thus liable to higher stamp duty. The trial court and High Court had rejected the application, holding that the documents were registered and properly stamped on their face. The Supreme Court noted that the crucial question was whether possession was transferred at or after execution of the power of attorney, which is a question of fact requiring evidence. The Court distinguished the case from Omprakash v. Laxminarayan, where possession was recited in the document itself. Relying on Bipin Shantilal Panchal v. State of Gujarat, the Court observed that while objections regarding stamp duty must generally be decided before proceeding further, where evidence is needed to determine the nature of the document, it is reasonable to defer the decision to the final stage. The Court set aside the orders of the trial court and High Court and remitted the matter to the trial court to decide the objection after evidence is led, along with the main suit.
Headnote
A) Civil Procedure - Stamp Duty - Power of Attorney as Conveyance - Objection regarding insufficient stamp duty on a power of attorney, claimed to be a conveyance under the Orissa amendment to the Indian Stamp Act, 1899, requires a factual finding on whether possession was transferred at or after execution - The court held that such objection, depending on evidence of delivery of possession, can be deferred to be decided at the final stage of the suit after evidence is led (Paras 11-14). B) Evidence Act - Admissibility of Documents - Objection as to Stamp Duty - The practice of deciding objections regarding deficiency of stamp duty before proceeding further, as laid down in Bipin Shantilal Panchal v. State of Gujarat, is subject to exception where evidence is required to determine the nature of the document - In such cases, it is reasonable to defer the decision on admissibility to the final stage (Paras 10, 13). C) Indian Stamp Act, 1899 - Sections 35, 36 - Impounding of Documents - Section 36 applies only when an objection regarding insufficient stamp duty has been judicially determined - Where objection is raised but not judicially determined, the document cannot be excluded from consideration under Section 36 (Para 7).
Issue of Consideration
Whether a power of attorney, which is claimed to be a conveyance under the Orissa amendment to the Indian Stamp Act, 1899, due to transfer of possession, should be impounded for insufficient stamp duty at the stage of evidence or whether the question of delivery of possession should be decided after evidence is led.
Final Decision
The Supreme Court set aside the orders of the trial court dated 14th December, 2018 and the High Court dated 24th January, 2019. The matter was remitted to the trial court to decide the objection of admissibility of the documents on account of being insufficiently stamped, after evidence is led by the parties, along with the main suit. The appeal was disposed of.
Law Points
- Stamp duty on power of attorney
- Conveyance under Indian Stamp Act
- Impounding of documents
- Admissibility of insufficiently stamped documents
- Order XIII Rule 8 CPC
- Section 35 Indian Stamp Act
- Section 36 Indian Stamp Act
- Article 23 Schedule IA Indian Stamp Act (Orissa Amendment)
- Article 48(f) Indian Stamp Act (Orissa Amendment)
- Objection to admissibility at evidence stage
- Deferral of decision on stamp duty objection
