C.K. Ravi Prasanna S/O Late C.P. ... vs T.K. Gowramma W/O T. Krishana ...

on 1 June, 2007

Equivalent citations: ILR 2007 KAR 2807, 2007 (5) KarLJ 344

Bench: H N Das

C.K. Ravi Prasanna S/O Late C.P. Krishnappa Gowda vs T.K. Gowramma W/O T. Krishana Kumar on
1/6/2007

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

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

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.
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 C.K. Ravi Prasanna S/O Late C.P. ... vs T.K. Gowramma W/O T. Krishana ... on 1 June, 2007

1. Sri. Bondar Singh and Ors. v. Sri. Nihal Singh and Ors.

2. Mst. Kirpal Kuar v. Bachan Singh and Ors.

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. 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 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
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 C.K. Ravi Prasanna S/O Late C.P. ... vs T.K. Gowramma W/O T. Krishana ... on 1 June, 2007

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.

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