Anantanarayana Ayyar, J.
1. This is a petition to revise the order of the District Munsiff, Kollapur dated 26-3-1959 holding that the two documents which had been filed by the defendant in that suit were contracts of sale and not agreements of sale and ordering as follows:
'.......Definitely they are contracts of sale which require stamp according to Article 16 of the Hyderabad Stamp Act. Sheristadar is directed to calculate the penalty and submit. Party producing them to deposit the penalty as levies by the Court. In case the party fails to deposit the penalties the documents shall be impounded and sent to the Collector for necessary action. For evidence of defendant call on 11-4-1959.'
2. Two contentions have been raised before me as follows:
1. That the two documents are not sales but agreements to sell.
2. That the learned District Munsiff erred in ordering payment of stamp duty and penalty before the stage of admission of documents in evidence was reached.
3. POINT NO. 1 : Both the documents are of the same date 14-5-1958. Each of them contains the following recitals on which the plaintiff-respondent rely:
1.......the amount of decree could not be paid to you in full. For the payment of this amount, I have sold now my own dry land.......
(rights in the land are transferred and consideration is paid).
2. The same has been given into your possession.
3. This land was purchased by me from Sivayya....... and its sale deed was registered on 2-3-1950. I have handed over that sale deed now to you.
4. Uptill now, whatever rights had vested in me in respect of this land, all those rights have become transferred to you and have now vested in you.
4. The learned Advocate for the defendant, relies on the following recitals in the document;
(A) As and when required I will get the sale deed transferred in your name and the Goshware (abstract) will be got completed.
(B) The expenses of registration etc. should be borne by you only.
(C) I have got this deed of agreement executed.
5. The second document alone contains an additional recital relied on by the learned Advocate for the defendants, as follows:
(D) In future with regard to this land, for the execution of the sale deed and for the transfer and mutation proceedings, if we are asked to accompany, we will go with you and accomplish the same.
6. In Skinner v. Skinner, 57 Mad LJ 765 (AIR 1929 PC 269), their Lordships of the Privy Council had to decide whether a document was admissible in evidence in that connection whether it was a sale deed. The learned Subordinate Judge in that case held that the document was a sale deed and, therefore, required registration under Section 17 and that being unregistered, it was not admissible in evidence. The High Court, on appeal, held that the document ought to be treated as being an agreement for sale rather than a sale deed & that, therefore, registration was not necessary. Their Lordships of the Privy Council disagreed with the High Court, agreed with the Sub-Judge and held that the document was a sale deed and not an agreement to sell, mainly on the following. grounds:
(1) The language employed is Perhaps not that of a trained draftsman, but the document clearly purports to transfer the executant's interest in the immovable properties which he had inherited from his brother.
(2) The document in addition to creating an interest in immovable property provided as one of the terms and therefore, an integral part of the transfer that the vendor should, if the vendee so required, execute a registered sale deed.
In this case it will be observed, that transfer of interest in the Property is clearly effected as seen from the language : Vide (1) of the recitals and the recital regarding registration cannot avail the defendant.
7. In K. Venkat Narasiah v. B. Pullaiah, unreported decision of this Court in C. R. P. No. 199 of 1959 dated 3-11-1959 it has been observed by my learned brother Satyanarayana Raju J. that the title of the document is not always conclusive. So, in the present case, the mere fact that the documents are styled as agreements (recital C) does not avail the defendant. In that judgment, the learned Judge further observed that the fact that the document is for the delivery of the land is not decisive on the question as to whether the document was a sale or a mere agreement to sell. Therefore, Ground No. 2 is not by itself decisive.
8. In unreported decision of this Court in C. R. P. No. 199 of 1959 dated 3-11-1959 the learned Judge also observed that there was a provision for the execution of a sale deed at a future date after obtaining the permission of the District Collector which is obligatory under Section 47 of the Hyderabad Tenancy and Agricultural Lands Act No. XXI of 1950 and that was a matter which has got to be taken into consideration. In that decision, the learned Judge came to the conclusion that the document concerned was an agreement and not a sale on a consideration of the cumulative effect of the various relevant features. In this case also, it is the cumulative effect which has got to be considered.
9. In Ma Thin Za v. Veera Kalai, AIR 1931 Rang 193 (2), a document recited that in consideration of certain debts, the paddy land was delivered to the creditor and the document further showed that the transaction had not passed the stage of a contract of sale and it contained a promise to perfect the tide by registering deed of conveyance. It was held that the document was an agreement falling under Article 5 of the Stamp Act (2 of 1899) on two grounds namely, that the word 'agreement' was used in two places in the document and that the document disclosed that the executant gave an undertaking to execute a registered conveyance later.
10. The learned Advocate for the petitioner relies on an observation in Narasimhaswami v. Venkatalingam, AIR 1927 Mad 636 (FB) that a document which does not by itself convey property but merely gives a right to call for another document does not require registration. He argues on the same principle that the document does not require to be stamped. That observation does not help the petitioner because it is clear that each of the two documents in the present case conveys property and does not merely give a right to call for another document.
11. In Devasikamani Goundar v. Andamuthu Goundar, 1955-1 Mad LJ 457 by an agreement the co-owners did not purport to divide their joint properties in severally nor did they agree to divide them in any manner, but the instrument mentioned the fact that certain panchayatdars had allotted certain properties to each of the co-owners, and further it was agreed that the parties in future would have a regular partition deed, executed and registered. Rajamannar, C. J., held that in so far as the document in question did not purport to divide the properties nor agreed to divide the properties, it did not fall within Section 2 Clause (15) of the Indian Stamp Act (II of 1899).
In that case, the decision appears to have turned on the fact that the document 'did not however purport to divide the properties nor contained an agreement to divide the properties.' No distinction was drawn or sought to be drawn between a partition and an agreement to partition. Such a distinction would be immaterial in that case as both a partition and an agreement to partition were liable to stamp duty under Section 2 Clause (15). For, an instrument of partition is defined in the Stamp Act, as follows:
'any instrument whereby co-owners of any property divide or agree to divide such property in severally .......'
'So, that decision does not help the defendant in this case and it is of no use for deciding the present case.
12. The Privy Council in 57 Mad LJ 765 : (AIR 1929 PC 269) has held in effect that the mere offer to execute and register a sale deed at a later date does not take away the effect of a clear recital transferring the title and interest of the vendor to the vendee or change the character of a document from a sale to an agreement to sell. The mere use of the word 'agreement' is not conclusive as held by the learned Judge in Un-reported decision of this Court in C. R. P. 199 of 1959 dated 3-11-1959. It is the cumulative effect of all the recitals and the relevant facts which has to be taken into account to decide the question.
The provision for execution of sale deed and registration in both the documents and the provision for obtaining the permission of the District Collector under Section 47 of the Hyderabad Tenancy Act in one document show that contemplation of something being done in future by the vendor. The mere existence of such provision does not necessarily mean that either the document is not a sale or that the parties really intended to effect a real sale only by a document, duly stamped and registered. For the provision for registration in the document, concerned in the decision of the Privy Council in 57 Mad LJ 765 : (AIR 1929 PC 269) has not rendered the document an agreement to sell.
13. Considering all the features as a whole, I find that the features A, B and C do not affect the clear provisions (1), (2), (3) and (4) and that the latter prevail and that, on the cumulative effect of the various features, each document is a sale and not an agreement to sell.
14. Point No. 2:- In 1955-1 Mad LJ 457 it was held that, if an objection was taken to the admissibility of a document for want of stamp and registration, it was the duty of the Court to decide both the questions at once and that if the Court found that the document was unregistered though it required registration, the Court had to reject the document itself and could not ask the document to be stamped first and thereafter decide whether it would require registration.
What happened in this case was that after the documents were filed, the Court has asked for stamp duty and penalty to be paid even before the stage came for considering the question of their admissibility in evidence. From the principle of the above case, it does not appear to be proper for the lower Court to consider the question of stamp duty and penalty and ask for payment of those amounts when there was a great probability amounting to a practical certainty that at the time of considering the admission of the documents, it would be rejected as inadmissible due to want of registration.
15. In Balram Das v. Kedar Nath, : AIR1958All659 the document was voluntarily tendered in court by the party as part of the evidence and was not withdrawn by the applicant when the question regarding sufficiency of stamp was raised by the Inspector of Stamps. In such circumstances, the Allahabad High Court observed (at page 660) as follows:
'...... Further, Section 33 of the Stamp Act applies not only to cases where a document is produced in Court, but also to cases where the document comes to the notice of the Court in the performance of its functions. In the present case, the document having been filed and the question of court-fee having been raised the Court had to give its decision of the question, in deciding the matter, the Court was performing its functions. The document had, therefore, come to the notice of the Court in the performance of its functions, and the Court was competent to impound it.'
In this case it is clear beyond doubt that the Court had the power to impound the document under the provisions of the Hyderabad Stamp Act! corresponding to Section 33 of the Indian Stamp Act and the Court rightly impounded the document.
16. The point-under consideration is as to whether the Court could collect stamp duty and penalty at that stage even before the time of admission in evidence came in. Section 35 of the Indian Stamp Act, 1899 provides that no instrument chargeable with duty shall be admitted in evidence unless it is duly stamped hut proviso (a) to that section provides that a document like the Present one shall be admitted in evidence on payment of the duty with which the same is chargeable or deficit duty together with a penalty equal to ten times to that amount of duty or deficit duty.
Section 38 provides as to how the Court impounding the instrument under Section 33 has to deal with the document. Section 38(1) provides that, if duty and penalty were Paid, the person impounding the instrument shall send to the Collector an authenticated copy of such document and shall also send to the Collector the entire amount collected. Section 38(2) provides that in other cases, the impounding person shall send the document in original to the Collector, Section 39 gives powers to the Collector to refund penalty paid on documents which have been sent under Section 38(1).
It gives him discretion to refund any portion of the penalty in excess of Rs. 5/-. Section 40 gives power to the Collector to adopt the procedure given in the following sections to collect the stamp duty or deficit stamp duty and to collect the penalty which shall be an amount not exceeding 10 times the duty or deficit duty.
17. Section 35 proviso (a) provides that the instrument which is unstamped or insufficiently stamped shall be admitted in evidence on payment of duty and penalty. Obviously, it presumes that the document would be admissible in evidence if the stamp duty and penalty were paid. It also presumes that the document would not be having any other defects (for example, being unregistered though it is required by law to be registered and, therefore, is inadmissible under Section 17 of the Indian Registration Act).
This suggests that the collection of stamp duty should not be done before the stage of admissibility of the document in evidence. Further it is obvious that, if stamp duty and penalty are collected in advance and, later the document is not admitted in evidence, the party concerned would have to pay penalty equal to ten times the duty or deficit duty and take the chance of getting refund afterwards under Section 39 and lose the chance of having to pay a smaller penalty in the first instance at the discretion of the Collector under Section 40 (1) (b) without the advantage of the document being admitted in evidence.
This would cause undue hardship to the party. Such undue hardship will be avoided if the provision under proviso (a) to Section 35 and indicated in 1955-1 Mad LJ 457 were followed. In 1955-1 Mad LJ 457, the question of admissibility due to want of registration was also raised at the time when the question of admissibility due to want of stamp was raised.
In the present case, the question of admissibility due to deficiency of stamp alone seems to have been raised. This does not make a difference to the principle that stamp duty has to be collected at the time of admission of the document into evidence under proviso (a) to Section 35 of the Indian Stamp Act I find that this point is tenable and hold that the learned District Munsiff erred in ordering payment of stamp duty and penalty before the stage of admission of documents in evidence was reached.
18. The learned Advocate for the respondent has contended that this revision petition is not maintainable on the ground that the question raised in the lower Court was about the interpretation of the contents of a document which, did not raise any question of jurisdiction. For this purpose, he relies on the observations of the Allahabad High Court in : AIR1958All659 as follows:
'....... This question related to the interpretation of the document. If the document itself was capable of both the interpretations then it was perfectly within the jurisdiction of the Court to put any interpretation that it considered reasonable on the document in question. This point, therefore, does not raise any question of jurisdiction, and the revision petition would not lie on this ground'.
That case itself was decided on a civil revision petition. It was observed that the revision would not lie solely on the ground that the interpretation of the document by the lower Court was wrong and that the point did not raise any question of jurisdiction. An additional point was also raised in that case namely, that the Court had no power to impound the document under section 33 of the Stamp Act.
The High Court actually entertained that revision petition and decided that particular point holding that the Court was competent to impound the document and thereupon dismissed the Civil Revision Petition as having no force and not on the ground that it did not lie. In this case also, the second point is regarding the question as to whether stamp duty could be collected at the particular stage in the lower Court.
Further, the decision of the Madras High Court in 1955-1 Mad LJ 457 was itself a Civil Revision Petition and therein, the Court went into the question as to whether the document required stamp duty and penalty, and, for that purpose considered the question as to whether the document was an instrument of partition and decided that it was not an instrument of partition as defined in Section 2(15) of the Indian Stamp Act and, therefore, did not require stamp under that provision.
In this case also, the second point is regarding the question as to whether stamp duty could be collected at the particular stage in the lower court.
The question as to whether the document is a sale or an agreement to sell is not the sole question that is raised. In 1955-1 Mad LJ 457 the preliminary issue was whether the document dated 7-1-1947 is not valid in the absence of registration and proper stamp. So also, in this case, the question is involved as to whether the document is not valid in the absence of proper stamp and whether stamp duty and penalty had to be paid as directed by the lower Court. Accordingly I find that the Civil Revision Petition is maintainable under Section 115 C. P. C.
19. In the result, the revision petition isallowed only to the extent of setting aside theorder of the lower Court directing deposit of stampduty and payment of penalty and the lower Courtis directed to dispose of the matter in the light ofthe above observations. As the petitioner has succeeded in part, I make no order as to costs.