Therefore what flows from the aforesaid Judgments is that if the delivery of possession is to take place on the execution of the sale deed then such an agreement would not be covered by the Explanation 1 to Article 25. It is in the said context that the stipulation in the document in the instant matter would have to be considered. Though clause (5) postulates an Agreement to Sale to be executed and an amount of ` 4,00,000/- to be paid out of the balance consideration at the time of Agreement to Sale and thereafter a sale deed to be executed at which time the possession is to be handed over, it is clause (11) which is the defining clause as it were which in my view determines the nature of the transaction. By the said clause (11), the Vendor has agreed to hand over possession of the land in question as and when called upon by the Vendee i.e. the Plaintiff abovenamed. The said clause (11) therefore as indicated above strikes a different note than the clause (5) and clause (6) in the matter of handing over possession. The said clause (11) therefore superimposes itself as on clause (5) which contemplates an Agreement to Sale and thereafter a sale deed being executed. Since by virtue of clause (11) the possession is to be handed over to the Vendee as and when he calls upon the Vendor the said clause can be said to be a clause governing the handing over of possession prior to Sale Deed being executed. In view of the said clause (11) therefore the agreement in question would be covered by Explanation 1 to Article 25 of Schedule-I as the said document can be said to be in the nature of a conveyance. The trial Court therefore has rightly come to a conclusion that the agreement was required to be stamped on the basis that it was a conveyance.
Citation: 2013(4)ALLMR126, 2013(4)BomCR844, 2013(3)MhLj433
IN THE HIGH COURT OF BOMBAY
Decided On: 14.03.2013
Appellants: Jayasingh Narayan Tupe
Vs.
Respondent: Sambhaji Baburao Pawar and Others
Vs.
Respondent: Sambhaji Baburao Pawar and Others
Hon'ble Judges/Coram:R.M. Savant , J
1. Rule with the consent of the parties made returnable forthwith and heard. The Writ Jurisdiction of this Court under Article 226 of the Constitution of India has been invoked against the order dated 3-1-2013 passed by the learned Civil Judge Senior Division, Pune, by which order, the application Exhibit 55 filed by the Petitioner for exhibiting the Agreement to Sale dated 31-1-2005, came to be rejected. The said rejection was inter alia on the ground that the same was not properly stamped and in view of section 34 of the Bombay Stamp Act, the same was not therefore admissible in evidence.
2. The factual matrix involved in the above Petition can be stated in brief thus:
The Petitioner herein is the original Plaintiff and the Respondents herein are the original Defendants to the Suit in question being Special Civil Suit No. 904 of 2005. The said Suit has been filed by the Petitioner for specific performance of the agreement for sale dated 31-1-2005 in respect of new Survey No. 36 Hissa No. 4 + 5/2, New Survey No. 41 Hissa No. 5/2 and New Survey No. 41 Hissa No. 5/5 situated at Village Fursungi Taluka Haveli, District Pune. It is the case of the Plaintiff that the Defendants were in need of money and therefore for legal necessity they had agreed to sell the land in question to the Plaintiff. The consideration fixed was an amount of ` 23,27,500/- and the Plaintiff paid an amount ` 1,00,000/- as the earnest amount and the Plaintiff agreed to pay an amount of ` 4,00,000/- to the Defendants at the time of execution of Agreement to Sale and it was also agreed to execute the sale deed within 6 months from the date of execution of the Agreement to Sale on payment of the balance amount of the consideration. It is the case of the Plaintiff that on 8-4-2005 he approached the Defendants for execution of the Agreement to Sale but the Defendants refused to execute the agreement resulting in the Plaintiff's issuing a notice through his Advocate to the Defendants on 13-4-2005, calling upon the Defendants to execute the sale deed. Since the Defendants refused to comply with the notice that the Plaintiff was constrained to file the Suit in question on the basis of the agreement dated 31-1-2005.
3. The Defendants filed their Written Statement and denied the case of the Plaintiff. It is the case of the Defendants that they have executed the Agreement to Sale dated 31-1-2005 as security for repayment of the hand loan and therefore the Plaintiff has not acquired any right under the said agreement. It is the case of the Defendants that they have never agreed to sell the land in question. It was further the case of the Defendants that since the said Agreement to Sale is not properly stamped, the same cannot be read in evidence. It seems that an application for temporary injunction came to be filed by the Plaintiff numbered as Exhibit 5. The said application came to be allowed by the trial Court by its order dated 21-1-2006.
4. The issues in the said Suit were framed. The parties went to trial and the Plaintiff filed his affidavit of examination-in-chief. The Defendants also amended their Written Statement which amended Written Statement was filed on 7-7-2011. The Plaintiff thereafter filed his further additional affidavit of examination-in-chief after the amendment of the Written Statement by the Defendants on 10-12-2012. The matter was fixed for admissibility of the documents. The Defendants objected to the exhibiting of the document in question i.e. Agreement/Earnest Money Receipt dated 31-1-2005 on the ground that it is not properly stamped. The said objection was sustained by the trial Court. The trial Court having regard to clause 11 of the Agreement came to a conclusion that the said Agreement would amount to a conveyance within the meaning of Explanation to Article 25 of Schedule-I of the Bombay Stamp Act and since the Plaintiff has not stamped the said documents as a conveyance, the same was inadmissible in evidence in view of section 34 of the Bombay Stamp Act. The trial Court therefore refused to exhibit the said document and held the said document to be inadmissible in evidence by the impugned order dated 3-1-2013.
5. In the context of the challenge raised to the said order dated 3-1-2013, it would be relevant to advert to the prayer clauses in the suit which are reproduced hereinunder (English translation):
(a) The Plaintiff suit be decreed and the Defendants be directed to execute the conveyance in favour of the Plaintiff after accepting the balance consideration of ` 22,27,500/- and also hand over possession to the Plaintiff.(b) If the Defendants fails to execute the sale deed in terms of the decree, it be directed that the sale deed be executed and registered through the Court Commissioner who may be appointed.
6. Heard the learned Counsel for the parties.
7. The learned Counsel appearing on behalf of the Plaintiff i.e. the Petitioner above named would contend that the Agreement to Sale is not a conveyance as it is in fact in the suit that the Plaintiff is seeking execution of the sale deed and for being handed over possession of the plot in question. The learned Counsel by adverting to the prayers in the suit would contend that the learned Judge has erred in relying upon clause (11) of the agreement. The learned Counsel would contend that though in clause (11) it has been mentioned that the Plaintiff can approach the Defendants at any time for possession, the Agreement postulates the execution of a further Agreement to Sale and therefore the document dated 31-1-2005 cannot be said to be a conveyance so as to attract the Explanation to Article 25 of Schedule-I. The learned Counsel would contend that the facts in the instant case wherein a substantial amount was remaining to be paid to the Defendants was a pointer to the fact that the document in question was not a conveyance. The learned Counsel would contend that the intention of the parties as well as the conduct of the parties would also be relevant factors which would have to be taken into consideration to arrive at a conclusion whether the said document dated 31-1-2005 is a conveyance so as to be covered by the Explanation to Article 25. The learned Counsel for the said purpose would rely upon the Judgment of a Division Bench of this Court reported in MANU/MH/0569/2006 : 2006 (5) Mh. L.J. 306 : 2006 (6) ALL MR 109 in the matter of Balwantgir Ganpatgir Giri (deceased through LRs.) vs. Manasi Construction and Developers and ors. The learned Counsel would contend that since the said agreement nowhere stipulates delivery of possession at any point of time prior to registration and execution of Sale Deed, it is therefore not a conveyance as contemplated by Article 25. In support of the said contention the learned Counsel would rely upon the Judgment of a learned Single Judge of this Court reported in 2006 (6) ALL MR 576 in the matter of Jugalkishore Jiwandas Arora vs. Sunil s/o Vinayakrao Kokje and anr. as also the Judgment of the Apex Court reported in AIR 1997 SC 807 in the matter of Veena Hasmukh Jain vs. State of Maharashtra.
8. Per contra the learned Counsel Mr. Deo appearing on behalf of the Respondents i.e. the original Defendants would contend that in the context of clause (11) the order passed by the trial Court holding that the said document dated 31-1-2005 is inadmissible in evidence cannot be questioned. The learned Counsel would contend that the said document confers right upon the Plaintiff to ask for possession and if that be so, the document in question would amount to a conveyance. The learned Counsel would contend that though by the earlier clauses the execution of a further agreement is contemplated but by clause (11) the said clauses are virtually given a go-by, as the Plaintiff in terms of the said clause (11) is within his rights to ask for possession. The learned Counsel would contend that it is the nature of the document in question which is determinative factor and not the relief sought in the Suit. If the nature of the document in the instant case is concerned and especially having regard to clause (11), the learned Counsel would contend that the same unequivocally points out that the possession can be handed over to the Plaintiff, prior to the execution and registration of the sale deed and the agreement would therefore be covered by the Explanation to Article 25 of Schedule-I. The learned Counsel would contend that it is for the Plaintiff to pay the necessary stamp duty and thereafter seek exhibition of the said document as a piece of documentary evidence.
9. Having heard the learned Counsel for the parties, I have given my anxious consideration to the rival contentions.
It would be relevant to refer to the relevant clauses 5, 6 and 11 of the said document dated 31-1-2005, which are reproduced hereinunder (English Translation)
5) The vendors have agreed to sell along with their ownership right of other rights to the Vendees or the assignees/nominees for the consideration of ` 23,500/- (Rupees Twenty Three Thousand Five Hundred) out of which the Vendees have paid an amount of ` 1,00,000/- (Rupees One Lac) at the time of this agreement to the Vendor Nos. 1 and 2 as the Karta of the Joint Hindu Family as also the Vendor Nos. 3 and 4 as a part of the Joint Hindu Family. There is no need for a separate receipt in respect of the earnest amount. The balance earnest of ` 4,00,000/- would be paid by the Vendees to the Vendors at the time of execution of Agreement to Sale and the balance consideration would be paid over to the Vendors after they fulfill the terms and conditions of the Agreement to Sale and execute the sale deed in favour of the Vendees. The said sale deed/document will be executed within 6 months of the Agreement to Sale.6) The Vendees have to get the plot measured and demarcated from the concerned department within the time stipulated and at their own costs and thereafter give the said measurement map to the Vendors. In the event the area of the property on measurement is less, the amount in respect of the less area would be deducted from the consideration.11) It is agreed and accepted that the vacant and physical possession has to be handed over at the time of the execution of the sale deed or at the time of the execution of the document or as and when demanded by the Vendors to the Vendees or their nominees.
10. A reading of the aforesaid clauses therefore indicate that an Agreement to Sale was to be entered into between the parties at which time a part of the consideration was to be paid as earnest amount and the balance consideration was to be paid at the time of the execution of the sale deed and thereafter the possession was to be handed over. It can also be seen from clause (6) that it was the responsibility of the Vendors to get the property measured and demarcated. However, what is significant to note is that by clause (11) the possession which was to be handed over after the execution of the sale deed was to be handed over in terms of clause (11) as and when the Vendees i.e. the Plaintiff calls upon the Vendors i.e. the Defendants to do so. The said clause (11) therefore strikes a different note and since it is a subsequent or succeeding clause, the said clause can be said to denote the intention of the parties namely to hand over possession to the Vendees as and when called upon by them.
11. At this stage it would be relevant to take into consideration the judgments which were cited on behalf of the Petitioner.
12. Insofar as the Judgment in Balwantgir Giri's case (supra) the Division Bench of this Court was concerned with a similar issue as in the present case as to whether the document in question could be called a conveyance. In the facts of the said case where the agreement discloses that the delivery of possession would be on execution of the sale deed, the Division Bench held that the document in question cannot be construed as a conveyance as the agreement sought to restrict the delivery of possession on execution of the sale deed. The Division Bench as can be seen adverted to the object for incorporating the Explanation I to Article 25, which was to plug the loophole in respect of the transactions where the possession is handed over on the execution of the Agreement to Sale and the parties to avoid payment of stamp duty do not execute the sale deed. The relevant paragraph of the Judgment in Balwantgir's case is paragraph 9 which is reproduced hereinunder:
9. The fact that the agreement in question clearly contemplates delivery of possession only on execution of the sale deed being not in dispute, in fact that itself is sufficient to reject all the contentions sought to be raised on behalf of the appellants. Besides, as rightly submitted on behalf of the respondents the Explanation to Article 25, the delivery of possession which transposes in agreement into a conveyance in terms of the said explanation is only in case of agreement to deliver that possession in terms of the agreement and not in terms of the sale deed agreed to be executed consequent to such agreement. Indeed, in case of execution of the sale deed it would carry the stamp duty which is required to be paid on a conveyance in accordance with the Article 25 of Schedule-I. Being so once the sale deed is executed by paying required stamp duty in terms of Article 25, the occasion to deprive the Government revenue cannot arise. For the said reason, once the agreement discloses that delivery would be on execution of the sale deed, it is needless to say that there could be no opportunity for the parties to defraud the Government. Being so an agreement which restricts delivery of possession on execution of the sale deed cannot be by any stretch of imagination construed to be a conveyance within the meaning of the said expression under Explanation-1 to Article 25 of Schedule-I of the said Act.
The Judgment in Jugal Kishore Arora's case also concerned a case where the agreement nowhere stipulated delivery of possession at any point of time prior to registration and execution of the sale deed. It is in the said context that a learned Single Judge of this Court in the said case held that the agreement in question concern therein could not be construed as a conveyance. Insofar as the Judgment of the Apex Court in Veena Hasmukh Jain's case is concerned, since the agreement therein was executed according to section 4 of the Maharashtra Ownership Flats (Regulations of the Promotion of Construction, Sale, Management and Transfer) Act and since there was a stipulation prescribing a specific time for delivery of possession prior to the execution of the sale deed, the Apex Court in the said case held that the said agreement would fall within the Explanation 1 to Article 25 of Schedule-I and would therefore be liable for stamp duty according to the said provisions.
13. Therefore what flows from the aforesaid Judgments is that if the delivery of possession is to take place on the execution of the sale deed then such an agreement would not be covered by the Explanation 1 to Article 25. It is in the said context that the stipulation in the document in the instant matter would have to be considered. Though clause (5) postulates an Agreement to Sale to be executed and an amount of ` 4,00,000/- to be paid out of the balance consideration at the time of Agreement to Sale and thereafter a sale deed to be executed at which time the possession is to be handed over, it is clause (11) which is the defining clause as it were which in my view determines the nature of the transaction. By the said clause (11), the Vendor has agreed to hand over possession of the land in question as and when called upon by the Vendee i.e. the Plaintiff abovenamed. The said clause (11) therefore as indicated above strikes a different note than the clause (5) and clause (6) in the matter of handing over possession. The said clause (11) therefore superimposes itself as on clause (5) which contemplates an Agreement to Sale and thereafter a sale deed being executed. Since by virtue of clause (11) the possession is to be handed over to the Vendee as and when he calls upon the Vendor the said clause can be said to be a clause governing the handing over of possession prior to Sale Deed being executed. In view of the said clause (11) therefore the agreement in question would be covered by Explanation 1 to Article 25 of Schedule-I as the said document can be said to be in the nature of a conveyance. The trial Court therefore has rightly come to a conclusion that the agreement was required to be stamped on the basis that it was a conveyance.
14. Now coming to the contention of the learned Counsel appearing for the Petitioner that since it is in the suit in question that the relief of the Defendants being directed to execute the sale deed and hand over possession is sought, the said document cannot be said to be a conveyance. In my view, it is not possible to accept the said contention as the determining factor has to be the document itself and not the relief claimed in the suit. In my view therefore, insofar as the finding of the trial Court of the document being not properly stamped, the same cannot be faulted with. However, the trial Court thereafter erred in not impounding the document under section 33 of the Bombay Stamp Act and sending it to the Collector for adjudication but has merely recorded that since the document is improperly stamped, it cannot be read in evidence. To that extent, the impugned order would have to be set aside and is accordingly set aside and the trial Court is directed to impound the said document and send it to the Collector for adjudication. It is only after the document is adjudicated upon for the payment of stamp duty and in the event the stamp duty is paid, that the Plaintiff can apply to the trial Court for the document to be read in evidence. Subject to the aforesaid directions, the Writ Petition is dismissed. Rule discharged with no order as to costs.
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