Point of Law : Any agreement of sale which evidences delivery of possession by virtue of the said agreement of sale or any document which even records that delivery of possession had been done even before the execution of the agreement of sale has been executed, would both fall within the ambit of Article 47-A of Schedule-1 A of the Indian Stamp Act, 1899.

ORDER :

The petitioners herein had filed O.S.No.629 of 2015 on the file of XII Additional District Judge, Visakhapatnam against the respondent herein seeking specific performance of agreement of sale dated 28.06.2015. In the course of the case, an issue had arisen as to whether the suit for agreement to sell has to be impounded for payment of stamp duty and penalty by treating the said document as a document of sale, under Explanation-1 to Article 47-A of Schedule-1 A of the Indian Stamp Act, 1899. After hearing both sides, the trial Court by an order dated 08.04.2021 had held that the document is chargeable as a sale under Explanation-1 to Article 47-A of Schedule-1 A of the Indian Stamp Act, 1899. Aggrieved by the said order, the petitioners have approached this Court, by way of the present civil revision petition.

2. Heard Sri S.V.S.S. Sivaram learned counsel, appearing for the petitioners and Sri C.V.R.Rudra Prasad learned counsel, appearing for the respondent.

3. The 2nd Petitioner is the daughter of the respondent and the 1st petitioner is the husband of the 2nd petitioner. The case of the petitioners, in the trial Court was that, the respondent, who was the owner of a plot of land had constructed the ground floor of a building and then gifted, by way of a registered deed of gift, dated 28.04.1999, the eastern side of the open terrace portion on the top of the ground floor to an extent of 450 square feet along with undivided interest in the land to an extent of 10 square yards out of the total extent of 319.5 square yards. The son of the defendant is said to have constructed a first floor on the eastern side, while the defendant had constructed the remaining portion of the first floor. Thereafter, in the year 2010, the 2nd petitioner is said to have constructed with her own funds and with the permission of the respondent, the entire 2nd floor of the building and that the respondent had orally gifted the entire 2nd floor to the 2nd petitioner with a promise to execute a Registered Gift Settlement Deed.

4. As the respondent was intending to dispose of the ground floor portion of the building, the petitioners herein had sought to purchase the property and asked for a sale deed to be executed in relation to the ground floor and the 2nd floor. Accordingly, an agreement of sale had been executed between the parties on 28.06.2015 for sale of both the ground floor and the 2nd floor of the building. The petitioners then state that as the respondent was unwilling to execute the deed of sale and after exchange of notice between the parties, the present suit had been filed.

5. The respondent contends that the said unregistered agreement of sale was, in fact, a sale and the document is required to be impounded and stamped by treating the document as a sale under Explanation-1 to Article 47-A of Schedule-1 A of the Indian Stamp Act, 1899.

6. Entry 47-A of Schedule-1-A of the Indian Stamp Act, 1899 reads as follows:

47-A. Sale as defined in Section 54 of the Transfer of Property Act, 1882:

(a) in respect of property situated in any local area comprised in a Municipal Corporation:

(b) ……

(c) …….

(d) …….

Explanation-I

An agreement to sell followed by or evidencing delivery of possession of the property agreed to be sold shall be chargeable as a “sale” under this Article:

Provided that, where subsequently a sale deed is executed in pursuance of an agreement of sale as aforesaid or in pursuance of an agreement referred to in Clause (b) of Article, the stamp duty, if any, already paid or recovered on the agreement of sale shall be adjusted towards the total duty leviable on the sale deed.

Explanation-II ….

7. In view of Explanation-I, any document which evidences delivery of possession requires to be treated as a document falling under entry 47-A of Schedule-1-A of the Indian Stamp Act, 1899. The respondent contends that the agreement of sale dated 28.06.2015 contains a provision, evidencing delivery of possession, while the petitioners contend that there