Case Note & Summary
The petitioners, who are plaintiffs in O.S. No.4/2009 pending before the Senior Civil Judge, Lingasugur, filed a suit for specific performance based on two agreements to sell dated 04.06.2008 and 10.06.2008. They claimed that possession of the suit property was delivered to them under the agreement dated 10.06.2008 and they were in possession in part performance of the contract. During trial, when the plaintiffs sought to mark the sale agreement dated 10.06.2008 as an exhibit, the defendants objected on the ground that the document was not engrossed on the requisite stamp paper and thus could not be admitted in evidence. The trial court, by order dated 26.03.2010, directed that the document be sent to the Deputy Commissioner for impounding under Section 34 of the Karnataka Stamp Act, 1957. Aggrieved, the plaintiffs filed the present writ petition under Articles 226 and 227 of the Constitution of India seeking to quash that order. The High Court examined the provisions of the Karnataka Stamp Act, particularly Section 34, which prohibits admission of an insufficiently stamped instrument in evidence for any purpose unless the deficit stamp duty and penalty are paid. The court noted that the document in question was a sale agreement which was required to be stamped under Article 5(e) of the Schedule to the Act. Since the document was insufficiently stamped, the trial court was correct in refusing to admit it and sending it for impounding. The High Court dismissed the writ petition, holding that the trial court's order was legal and proper, and that the plaintiffs could seek to have the document admitted after payment of the requisite duty and penalty.
Headnote
A) Stamp Act - Impounding of Documents - Section 34 of Karnataka Stamp Act, 1957 - Admissibility - The court held that an agreement to sell which is insufficiently stamped cannot be admitted in evidence unless the deficit stamp duty and penalty are paid. The trial court's order to send the document to the Deputy Commissioner for impounding was upheld. (Paras 1-5) B) Civil Procedure - Evidence - Marking of Documents - The court held that the objection as to admissibility of a document on the ground of insufficient stamping can be raised at any stage, and the court is duty-bound to examine the document before admitting it. (Para 4) C) Transfer of Property Act - Part Performance - Section 53A - The court noted that the plaintiffs claimed possession under the agreement and sought to rely on Section 53A, but the document being insufficiently stamped could not be looked into for any purpose until the stamp duty and penalty are paid. (Para 3)
Issue of Consideration
Whether a sale agreement which is insufficiently stamped can be admitted in evidence without being impounded and the deficit stamp duty and penalty paid.
Final Decision
The High Court dismissed the writ petition, upholding the trial court's order to send the sale agreement to the Deputy Commissioner for impounding under Section 34 of the Karnataka Stamp Act, 1957. The court held that the document being insufficiently stamped could not be admitted in evidence until the deficit stamp duty and penalty are paid.
Law Points
- Stamp duty
- impounding of documents
- admissibility of insufficiently stamped documents
- Section 34 of Karnataka Stamp Act
- 1957
- Section 35 of Indian Stamp Act
- 1899
- part performance
- Section 53A of Transfer of Property Act
- 1882
