Judgment:
M.Y. Eqbal, J.
1. In this writ petition, the petitioner has prayed for issuance of appropriate writ in the nature of certiorari for quashing the notice dated 21.1.2005 issued by respondent No. 2 - the District Registrar, Hazaribagh whereby he has directed the petitioner to pay a sum of Rs. 82,112/- in respect of Deed No. 13 dated 09.6.1999 being the stamp duly which is liable to be paid for the aforesaid deed of Power of Attorney executed in favour of the petitioner.
2. Before deciding the interesting question of law involved in this writ petition, I would like to refer first some of the relevant facts as under:
A registered Power of Attorney dated 09.6.1999 being Deed No. 13 was executed by Prakash Kumar, Prabhat Kumar, Prashant Kumar and Sunil Kumar in favour of the petitioner in respect of 0.35 1/2 acres of plot No. 56 under Khata No. 12 situated in the district of Hazaribagh authorizing the petitioner to manage, sell, to defend or file any case and to do all necessary acts including transfer of the said property by executing sale deed in the name of and on behalf of the executant and receive the consideration amount and to pay the same to the executant. According to the petitioner, the said registered deed of Power of Attorney was duly stamped according to the Stamp Act. The petitioner being the Power of Attorney Holder beside doing other things in respect of the said properly executed various sale deeds in favour of different persons. However, the petitioner shocked to receive the impugned notice dated 21.9.2005 issued by the District Sub Registrar, Hazaribagh whereby the petitioner has been directed to pay a sum of Rs. 82,112/- being the stamp duty payable in the said Power of Attorney treating the same as an instrument of sale.
3. Learned Counsel appearing for the petitioner firstly submitted that the Sub Registrar has no power to issue the impugned notice and the same is wholly without jurisdiction. Learned Counsel submitted that the registered Power of Attorney did not create, assign, limit or extinguish any right, title or interest in favour of the petitioner in respect of the said property, rather the document merely authorizes and empower the petitioner to manage, deal with, transfer or to do all necessary acts which may be necessary in respect of the said property in the name of and on behalf of the executant.
4. Section 2(21) of the Power of Attorney Act 1822 defines the word 'Power of Attorney' which reads as under:
(21) Power-of-attorney. - Power-of-attorney' includes any instrument (not chargeable with a fee under the law relating to Court-fees for the time being in force) empowering a specified person to act for and in the name of the person executing it.
5. From bare reading of the definition, it appears that a Power of Attorney is a formal document whereby one person authorizes another to represent him and act in his name in relation to any transaction or a number of transactions. Article 48 of Schedule I of the Act prescribes the duty chargeable in respect of Power of Attorney. Article 48 reads as under:
Corresponding State Schedule/Article 48.
Description of Instrument Power-of-Attorney [asdefined by Section 2(21) not being a Proxy (No. 52)-
Proper Stamp Duty
(a) when executed for the sole purpose ofprocuring the registration of one or more documents in relation to a singletransaction or for admitting execution of one or more such documents;
Eight annas.
(b) when required in suits or proceedings under thePresidency Small Cause Courts Act 1882.
Eight annas.
(c) When authorizing one person or more to act ina single transaction other than case mentioned in Clause (a);
One rupee.
(d) When authorizing not more than five personsto act jointly and severally in more than one transaction or generally;
Five rupees.
(e) when authorizing more than five but not morethan ten persons to act jointly and severally in more act jointly andseverally in more than one transaction or generally;
Ten rupees.
(f) when given for consideration and authorizingthe attorney to sell any immovable properly;
The same duty as a Conveyance (No. 23) for theamount of the consideration.
(g) in any other case
One rupee for each person authorized.
Explanation. - For the purposes of this articlemore persons than one when belonging to the same firm shall be deemed to beone person.
N.B., - the term 'registration'includes every operation incidental to registration under the IndianRegistration Act, 1877.
6. By Bihar Finance Act (II of 2002) Act, 2001 the Article as amended by Bihar Amendment reads as under:
I-A/48.
Power-of-Attorney. - As defined by Section 2(24)not being a proxy:
(a) When executed for the sole purpose ofprocuring the registration of one or more document in relation to a singletransaction or for admitting execution of one or more such, documents
(a) Rs. 100/- (One hundred)
(b) when required in suits or proceedings underthe Presidency Small Cause Courts Act, 1882.
(b) Rs. 100/- (One hundred)
(c) When authorizing one person or more in a
(c) Rs. 200/- (two hundred)
Single transaction other than the case mentionedin Clause (a);
(d) When authorizing not more than five personsto act jointly and severally in more than one transaction or generally;
(d) Rs. 300/-(three hundred)
(e) when authorizing more than five but not morethan ten persons to act jointly and severally in more than onetransaction or generally;
(e) Rs. 500/- (five hundred)
(f) when given for consideration and authorizingthe attorney to sell any immovable property;
(f) same as Conveyance (No. 23) for aconsideration or market value equal to the amount of the consideration.
(g) in any other case
(g) Rs. 500/- (five hundred) for each personauthorized.
(h) When given for construction on development ofor sale or transfer (in any other case) of any immovable property.
(h) Rs. 5/- for every hundred rupees or partthereof on the market value of the property.
Explanation I. - For the purpose of this article more persons than one when belonging to the same firm shall be deemed to be one person.
Explanation II. - the term 'registration' includes every operation incidental to registration under the Registration Act, 1908.
Explanation III. - Where under Clause (f) and (h), duty has been paid on the power-of-attorney and a conveyance relating to that property is executed in pursuance of Power-of-attorney between the executant of the power-of-attorney and the person in whose favour it is executed, the duty of conveyance shall be the duty calculated on the market value of the property reduced by duty paid on the power-of-attorney.
7. Neither the petitioner's counsel nor the learned Advocate General has drawn my attention to any amendment made in Article 48 by the State of Jharkhand or the Bihar amendment was adopted in the State.
8. From bare reading of Article 48(f) it is manifestly clear that in case the power of attorney is given for consideration authorizing the attorney to sell any immovable property then the same duty is payable in respect of conveyance for a consideration on the market value equal to the amount of consideration.
9. The sole question that falls for consideration is whether the power of attorney executed in favour of the petitioner to do all or any of the acts in order to save the property and also to arrange for sale of the property and to execute sale deed is for consideration? For better appreciation the contents of the power of attorney in question is worth to be reproduced herein below:
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10. From the contents of the power of attorney, it is clear that the executant has authorized the donee, to whom he has full faith, to look after and manage his property as he is not in a position to look after the property because of his pre-occupation. The executant, therefore, inter alia, authorised the donee to enter into an agreement to sell or sell the properly in his name and on his behalf. It is specifically mentioned in the instrument that whatever consideration for sale of the properly received by the donee shall be paid to the executant.
11. It is, therefore, evidently clear that the power of attorney is without any consideration. It is well settled that no consideration is necessary in order to create an agency as provided under Section 185 of the Contract Act. Hence no express consideration need to be stipulated for it.
12. There is much difference between the general power of attorney and an irrevocable power of attorney. Where the authority of an agent is required to be conferred by a deed or where an agent is appointed to formally act for the principal in one transaction or a series of transaction or to manage the affair of the principal generally, such document is known as power of attorney. Such an instrument confers a right to the donee to use the name of the principal. Whereas an agreement is entered into on sufficient consideration for the purpose of securing some benefits to the donee of the authority, such an authority irrevocable and is known as irrevocable power of attorney.
13. In the instant case, there is no consideration for the power of attorney executed by the executant in favour of the petitioner nor any benefit is derived in favour of the petitioner. There is no consideration for the authority given to the petitioner. The word 'consideration' means valuable consideration.
14. Coming back to Article 48(f) of the Schedule appended to the Act which provides that if the power of attorney is for consideration authorizing the attorney to sell the properly then the same duty is payable as a conveyance for the amount of consideration.
15. The term 'conveyance' has been defined under Section 2(10) of the Act which reads as under;
Conveyance.- 'Conveyance' includes a conveyance on sale and every instrument by which property, whether movable or immovable, is transferred inter vivos and which is not otherwise specifically provided for by Schedule 1.
16. Conveyance of sale is, therefore, an instrument whereby any property is legally or equitably transferred or vested in the purchaser. Consequently stamp duty payable on a conveyance is to be calculated on the value of the consideration set forth therein and in the manner provided under Article 23 of the Schedule appended to the Stamp Act.
17. As stated above, the power of attorney in question is not a conveyance by which executant transferred or alienated the property in favour of the petitioner for valuable consideration rather it authorizes the donee, inter alia, to initiate for sale and to sell the property and to pay the consideration amount so received to the executant. Such power of attorney cannot and shall not be treated as conveyance for consideration. Hence, no fresh stamp duty is payable to such document.
18. The stand of the State in the counter affidavit is that A.G. Office, made audit of Registrar office, Hazaribagh and raised objection that the instant power of attorney has been misplacing and there is a loss of Rs. 69,332/- in the stamp plus Rs. 12,780/- as registration fee, total amounting to Rs. 82,112/-. On the said audit objection the Registry made submission that he will look into the matter and take necessary action. It is further stated that in compliance of the audit report notice has been served to the attorney holder petitioner. Lastly it is stated that objection of the audit team is not justified and judicious.
19. The aforesaid statement made in the counter affidavit clearly shows that the registering authority may be Registrar or Sub-registrar, do not apply their mind while issuing such notices to the parties for payment of stamp duty. The registering authority at least should know the provisions of the Registration Act and the Stamp Act in the mater of payment of stamp duty or registration fee. In my considered opinion the impugned notice issued by the respondents on the basis of audit objection is palpably illegal arbitrary, mala fide and without jurisdiction.
20. For the reasons aforesaid, this writ petition is allowed and the impugned notice directing the petitioner to deposit the additional stamp duty is illegal and wholly without jurisdiction.