Case Note & Summary
The petitioner, defendant No.3 in O.S.No.8/2010, challenged an interlocutory order dated 21.11.2013 passed by the trial court directing him to pay stamp duty and penalty under Section 34 of the Karnataka Stamp Act, 1957. The suit was filed by the respondents. The trial court had directed the petitioner to pay the stamp duty and penalty on a document produced by him. The petitioner contended that he was not the executant or first recipient of the document and therefore could not be directed to pay the stamp duty and penalty. The High Court examined the language of Section 34 of the Karnataka Stamp Act, 1957, which provides that no instrument chargeable with duty shall be admitted in evidence unless the stamp duty and penalty are paid. The Court noted that the liability to pay stamp duty and penalty under Section 34 is on the person who executed or first received the instrument, and not on a third party who merely produces the document in evidence. The Court held that the trial court erred in directing the petitioner, who was not the executant or first recipient, to pay the stamp duty and penalty. Accordingly, the writ petition was allowed, and the impugned order was set aside.
Headnote
A) Stamp Act - Section 34 Karnataka Stamp Act, 1957 - Liability to pay stamp duty and penalty - The question was whether a person who is not the executant or first recipient of an instrument can be directed to pay stamp duty and penalty under Section 34 of the Karnataka Stamp Act, 1957 - The Court held that only the person who executed or first received the instrument can be directed to pay stamp duty and penalty, and not a third party who merely produces the document in evidence - The impugned order directing the petitioner (defendant No.3) to pay stamp duty and penalty was set aside (Paras 1-4)
Issue of Consideration
Who could be directed to pay the stamp duty and penalty under Section 34 of the Karnataka Stamp Act, 1957?
Final Decision
Writ petition allowed; impugned order dated 21.11.2013 passed by the Civil Judge & JMFC, Bagepalli in O.S.No.8/2010 is set aside
Law Points
- Stamp duty and penalty under Section 34 of Karnataka Stamp Act
- 1957 can only be directed against the person who executed or first received the instrument
- not against a third party who merely produces the document in evidence
