C.K. Ravi Prasanna S/O Late C.P. Krishnappa Gowda Vs. T.K. Gowramma W/O T. Krishana Kumar - Court Judgment

Excerpt:
- karnataka stamp act,1957 [k.a. no. 34/1957] -- section 34: [h.n. nagamohan das, j] bar under admissibility of non-stamped document held, section mandates no documents shall be admitted in evidence for any purpose unless it is duly stamped. section puts a complete embargo and bar against admissibility of such a document which is not duly stamped and the same cannot be used for any purpose. further, the petitioners possession and enjoyment of the schedule property is in part performance of the agreement of sale. therefore, agreement of sale falls under article 5e and the stamp duty is payable as per the conveyance specified in article 20. on facts, held, admittedly the agreement of sale is insufficiently stamped and the same cannot be admitted in evidence unless duty and penalty is paid. impugned order of the trial court held justified - therefore the impugned order passed by the trial court is bad in law.orderh.n. nagamohan das, j.1. in this writ petition the petitioner has prayed for a writ in the nature of certiorari to quash the order dated 07.03.2007 in o.s. no. 91/2005 passed by civil judge (junior division), at sullia, directing the petitioner to pay duty and penalty on the agreement of sale dated 27.11.2004.2. petitioner filed o.s. no. 91/2005 against the respondent for grant of decree of permanent injunction restraining the respondent from interfering with the petitioner's possession and enjoyment of the schedule property. the petitioner in his plaint relied on an agreement of sale dated 27.11.2004 said to have been executed by the respondent. the respondent entered appearance before the trial court, filed written statement denying the agreement of sale and opposed the claim of petitioner. after completion of the pleadings and framing of issues, the petitioner examined himself as p.w.1. in the evidence of p.w.1 he wanted to mark the agreement of sale dated 27.11.2004. the counsel for respondent raised objection for marking the agreement of sale on the ground that the same is insufficiently stamped and that the same is not registered. the trial court after hearing both the parties passed the impugned order holding that the agreement dated 27.11.2004 requires compulsory registration under section 17(1)-a of the registration act. it is further held that the agreement is not duly slumped and she same cannot, be admitted in evidence unless duty and penalty is paid. hence, this writ petition.3. sri. ashok haranahalli, learned counsel for petitioner contends, that the petitioner was in possession of the schedule property even prior to the agreement of sale dated 27.11.2004 and there was no delivery of possession of the schedule property to the petitioner. he contends that in the absence of delivery of possession under the agreement of sale the question of paying duty and penalty will not arise. he further contends, that the unregistered and unstamped agreement can be marked in evidence for collateral purpose of showing the nature of possession of the schedule property. he further contends, that in o.s. no. 91/2005 the petitioner is not seeking the relief of specific performance of agreement of sate dated. 27.11.2004. on the other hand the prayer of the petitioner is for decree of permanent injunction. therefore the impugned order passed by the trial court is bad in law. reliance is placed on the following decisions.1. sri. k. amarnath v. smt. puttamma : ilr1999kar4634 2. sri. k. anjaneya setty v. sri. k.h. rangaiah setty : air2002kant387 3. sri. bondar singh and ors. v. nihal singh and ors. 2003 air scw 13834. per contra sri. sunil s. rao for sri. t. seshagiri rao, learned counsel for respondent contends, that admittedly the nature of possession of petitioner prior to the agreement-dated 27.11.2004 was entirely different from the nature of possession under the agreement. therefore there is change in the nature of possession and consequently the agreement in question requires to be drawn on duly stamped paper and that the same is to be registered. as per section 34 of the karnataka stamp act whether it is for collateral purpose or for any other purpose the document is required to be drawn on a duly stamped paper. he further contends, that the agreement dated 27.11.2004 is not duly stamped and the same is not registered and as such the same is inadmissible in evidence. reliance is placed on the following decisions.1. sri. bondar singh and ors. v. sri. nihal singh and ors. : [2003]2scr564 2. mst. kirpal kuar v. bachan singh and ors. : [1958]1scr950 3. doddabasappa v. gurubasappa (deceased) by lrs and ors. 2001 (4) klj 1045. heard arguments on both the side and perused the entire writ papers.the supreme court in kirpal kuar v. bachan singh and ors. : [1958]1scr950 held:the agreement between the patties cannot be admitted in evidence to show the nature of possession of one of the parties subsequent to its date. the party being in possession before the date of the document, to admit it in evidence to show the nature of her possession subsequent to it would be to treat it as operating to destroy the nature of the previous possession and to convert what had started as adverse possession into a permissive possession and, therefore, to give effect to the agreement contained in it which admittedly cannot be done for want of registration. to admit it in evidence for the purpose sought would really amount to getting round the statutory bar imposed by section 49 of the registration act.6. in the instant case, petitioner admits that he was in possession of the schedule property prior to the agreement of sale dated 27.11.2004 for the purpose of managing the schedule property under the permission granted by the respondent subject to certain terms and conditions. under the agreement of sale dated 27.11.2004, petitioner is in possession of the schedule properly in part performance of agreement of sale. in view of law declared by the supreme court in kirpal kuar's case, the nature of possession of petitioner prior to the agreement of sale was entirely different and the same came to be destroyed under the agreement of sale dated 27.11.2004. the nature of possession of petitioner under the agreement of sale is in part performance of the agreement of sale and the terms and conditions are different. therefore the petitioner is not entitled to contend that he is in possession of schedule property even prior to the agreement of sale and he continue even after the agreement of sale. prior to the agreement of sale, the nature of petitioner's possession and enjoyment of the schedule property was on different terms and conditions. on the other hand, the present possession of the petitioner under the agreement of sale is entirely on a different footing and on different terms and conditions.7. section 34 of the karnataka stamp act mandates that no document shall be admitted in evidence for any purpose, unless it is duly stamped. section 34 of the act puts a complete embargo and bar against admissibility of such a document which is not stamped or which is not duly stamped and the same cannot be used for any purpose. in the instant case, under the agreement of sale dated 27.11.2004, the petitioner's possession and enjoyment of the schedule property is in part performance of the agreement. therefore, the agreement of sale in question falls under article 5e. therefore, the stamp duty is payable as per the conveyance specified in article 20. admittedly, the agreement of sale dated 27.11.2004 is insufficiently stamped. therefore, the agreement of sale cannot be admitted in evidence unless duty and penalty is paid. hence the impugned order passed by the trial court is in accordance with law.8. the contention of the learned counsel for the petitioner is that under section 49 of the registration act an unregistered and insufficiently stamped document could be received in evidence to prove any collateral purpose. this question came up for consideration before this court in k. amarnath v. smt. puttamma : ilr1999kar4634 wherein the scope of section 34 of karnataka stamp act and section 49 of the registration act came up for consideration. the court held as under:the difference between section 34 of (he karnataka stamp act and section 49 of the registration act should also be home in mind. section 34 says 'no instrument chargeable with duty shall be admitted in evidence for any purpose, or shall be acted upon, registered or authenticated by...unless such instrument is duty stamped' subject to the provision enabling the court to collect the deficit stamp duty, the bar under section 34 is absolute and an instrument which is not duly stamped cannot be admitted at all in evidence for any purpose. on the other hand, section 49 of the registration act which deals with the effect of non registration of documents provides that if a document which is required to be registered under law is not registered, then such document shall not affect any immovable property comprised therein, nor can it confer any power to adopt nor can it be received as evidence of any transaction affecting such property or conferring such power. but the proviso to section 49 provides that an unregistered instrument may be received as evidence of a contract in a suit for specific performance or as evidence of part performance of a contract for the purpose of section 53a of transfer of property act or as evidence of any collateral transaction not required to be effected by registered instrument. for example, if a sale deed is executed on a white paper and is not stamped, it can neither be admitted in evidence nor be used for any purpose. but if a sale deed is executed on requisite stamp paper but is not registered and the executant refuses to admit registration, then the purchaser has a right to file a suit for specific performance, and rely on the sale deed, even though it was not registered, as evidence of the contract for sale. thus, though both section 34 of the stamp act (corresponding to section 35 of the indian stamp act) and section 49 of the registration act, both bar the document being received as evidence, the bar is absolute under stamp act (unless deficit duty and penalty is paid) and the bar is not absolute under registration act,therefore under section 34 of the karnataka stamp act there is a bar for a document being received in evidence and the same is absolute unless deficit duty and penalty is paid. therefore, for any purpose, the document which is not duly stamped is inadmissible in evidence. i decline to accept the contention of the learned counsel for the petitioner. the impugned order passed by the trial court is in accordance with law and i find no justifiable grounds to interfere with the same.9. for the reasons stated above, writ petition is rejected.

Judgment:
ORDER

H.N. Nagamohan Das, J.

1. In this writ petition the petitioner has prayed for a writ in the nature of certiorari to quash the order dated 07.03.2007 in O.S. No. 91/2005 passed by Civil Judge (Junior Division), at Sullia, directing the petitioner to pay duty and penalty on the agreement of sale dated 27.11.2004.

2. Petitioner filed O.S. No. 91/2005 against the respondent for grant of decree of permanent injunction restraining the respondent from interfering with the petitioner's possession and enjoyment of the schedule property. The petitioner in his plaint relied on an agreement of sale dated 27.11.2004 said to have been executed by the respondent. The respondent entered appearance before the trial Court, filed written statement denying the agreement of sale and opposed the claim of petitioner. After completion of the pleadings and framing of issues, the petitioner examined himself as P.W.1. In the evidence of P.W.1 he wanted to mark the agreement of sale dated 27.11.2004. The counsel for respondent raised objection for marking the agreement of sale on the ground that the same is insufficiently stamped and that the same is not registered. The trial Court after hearing both the parties passed the impugned order holding that the agreement dated 27.11.2004 requires compulsory registration under Section 17(1)-A of the Registration Act. It is further held that the agreement is not duly slumped and She same cannot, be admitted in evidence unless duty and penalty is paid. Hence, this writ petition.

3. Sri. Ashok Haranahalli, learned Counsel for petitioner contends, that the petitioner was in possession of the schedule property even prior to the agreement of sale dated 27.11.2004 and there was no delivery of possession of the schedule property to the petitioner. He contends that in the absence of delivery of possession under the agreement of sale the question of paying duty and penalty will not arise. He further contends, that the unregistered and unstamped agreement can be marked in evidence for collateral purpose of showing the nature of possession of the schedule property. He further contends, that in O.S. No. 91/2005 the petitioner is not seeking the relief of specific performance of agreement of sate dated. 27.11.2004. On the other hand the prayer of the petitioner is for decree of permanent injunction. Therefore the impugned order passed by the trial Court is bad in law. Reliance is placed on the following decisions.

1. Sri. K. Amarnath v. Smt. Puttamma : ILR1999KAR4634

2. Sri. K. Anjaneya Setty v. Sri. K.H. Rangaiah Setty : AIR2002Kant387

3. Sri. Bondar Singh and Ors. v. Nihal Singh and Ors. 2003 AIR SCW 1383

4. Per contra Sri. Sunil S. Rao for Sri. T. Seshagiri Rao, learned Counsel for respondent contends, that admittedly the nature of possession of petitioner prior to the agreement-dated 27.11.2004 was entirely different from the nature of possession under the agreement. Therefore there is change in the nature of possession and consequently the agreement in question requires to be drawn on duly stamped paper and that the same is to be registered. As per Section 34 of the Karnataka Stamp Act whether it is for collateral purpose or for any other purpose the document is required to be drawn on a duly stamped paper. He further contends, that the agreement dated 27.11.2004 is not duly stamped and the same is not registered and as such the same is inadmissible in evidence. Reliance is placed on the following decisions.

1. Sri. Bondar Singh and Ors. v. Sri. Nihal Singh and Ors. : [2003]2SCR564

2. Mst. Kirpal Kuar v. Bachan Singh and Ors. : [1958]1SCR950

3. Doddabasappa v. Gurubasappa (deceased) by LRs and Ors. 2001 (4) KLJ 104

5. Heard arguments on both the side and perused the entire writ papers.

The Supreme Court in Kirpal Kuar v. Bachan Singh and Ors. : [1958]1SCR950 held:

The agreement between the patties cannot be admitted in evidence to show the nature of possession of one of the parties subsequent to its date. The party being in possession before the date of the document, to admit it in evidence to show the nature of her possession subsequent to it would be to treat it as operating to destroy the nature of the previous possession and to convert what had started as adverse possession into a permissive possession and, therefore, to give effect to the agreement contained in it which admittedly cannot be done for want of registration. To admit it in evidence for the purpose sought would really amount to getting round the statutory bar imposed by Section 49 of the Registration Act.

6. In the instant case, petitioner admits that he was in possession of the schedule property prior to the agreement of sale dated 27.11.2004 for the purpose of managing the schedule property under the permission granted by the respondent subject to certain terms and conditions. Under the agreement of sale dated 27.11.2004, petitioner is in possession of the schedule properly in part performance of agreement of sale. In view of law declared by the Supreme Court in Kirpal Kuar's case, the nature of possession of petitioner prior to the agreement of sale was entirely different and the same came to be destroyed under the agreement of sale dated 27.11.2004. The nature of possession of petitioner under the agreement of sale is in part performance of the agreement of sale and the terms and conditions are different. Therefore the petitioner is not entitled to contend that he is in possession of schedule property even prior to the agreement of sale and he continue even after the agreement of sale. Prior to the agreement of sale, the nature of petitioner's possession and enjoyment of the schedule property was on different terms and conditions. On the other hand, the present possession of the petitioner under the agreement of sale is entirely on a different footing and on different terms and conditions.

7. Section 34 of the Karnataka Stamp Act mandates that no document shall be admitted in evidence for any purpose, unless it is duly stamped. Section 34 of the Act puts a complete embargo and bar against admissibility of such a document which is not stamped or which is not duly stamped and the same cannot be used for any purpose. In the instant case, under the agreement of sale dated 27.11.2004, the petitioner's possession and enjoyment of the schedule property is in part performance of the agreement. Therefore, the agreement of sale in question falls under Article 5E. Therefore, the stamp duty is payable as per the conveyance specified in Article 20. Admittedly, the agreement of sale dated 27.11.2004 is insufficiently stamped. Therefore, the agreement of sale cannot be admitted in evidence unless duty and penalty is paid. Hence the impugned order passed by the Trial Court is in accordance with law.

8. The contention of the learned Counsel for the petitioner is that under Section 49 of the Registration Act an unregistered and insufficiently stamped document could be received in evidence to prove any collateral purpose. This question came up for consideration before this Court in K. Amarnath v. Smt. Puttamma : ILR1999KAR4634 wherein the scope of Section 34 of Karnataka Stamp Act and Section 49 of the Registration Act came up for consideration. The Court held as under:

The difference between Section 34 of (he Karnataka Stamp Act and Section 49 of the Registration Act should also be home in mind. Section 34 says 'no instrument chargeable with duty shall be admitted in evidence for any purpose, or shall be acted upon, registered or authenticated by...unless such instrument is duty stamped' Subject to the provision enabling the Court to collect the deficit Stamp duty, the bar under Section 34 is absolute and an instrument which is not duly stamped cannot be admitted at all in evidence for any purpose. On the other hand, Section 49 of the Registration Act which deals with the effect of non registration of documents provides that if a document which is required to be registered under law is not registered, then such document shall not affect any immovable property comprised therein, nor can it confer any power to adopt nor can it be received as evidence of any transaction affecting such property or conferring such power. But the proviso to Section 49 provides that an unregistered instrument may be received as evidence of a contract in a suit for specific performance or as evidence of part performance of a contract for the purpose of Section 53A of Transfer of Property Act or as evidence of any collateral transaction not required to be effected by registered instrument. For example, if a sale deed is executed on a white paper and is not stamped, it can neither be admitted in evidence nor be used for any purpose. But if a sale deed is executed on requisite stamp paper but is not registered and the executant refuses to admit registration, then the purchaser has a right to file a suit for specific performance, and rely on the sale deed, even though it was not registered, as evidence of the contract for sale. Thus, though both Section 34 of the Stamp Act (corresponding to Section 35 of the Indian Stamp Act) and Section 49 of the Registration Act, both bar the document being received as evidence, the bar is absolute under Stamp Act (unless deficit duty and penalty is paid) and the bar is not absolute under Registration Act,

Therefore under Section 34 of the Karnataka Stamp Act there is a bar for a document being received in evidence and the same is absolute unless deficit duty and penalty is paid. Therefore, for any purpose, the document which is not duly stamped is inadmissible in evidence. I decline to accept the contention of the learned Counsel for the petitioner. The impugned order passed by the Trial Court is in accordance with law and I find no justifiable grounds to interfere with the same.

9. For the reasons stated above, writ petition is rejected.