The central legal point established in the judgment is the distinction between rent reserved and consideration for the lease, and the implications of advance payment on stamp duty classification.

( 1 ) THIS is a reference under S. 54 of the Karnataka Stamp Act, 1957, (Act No. 34 of 1957), made by the Chief Controlling Revenue Authority to this Court stating the case referred and seeking for the opinion thereon of this Court.

( 2 ) THE Managing Director of M/s. Bangalore Trading and Financing Corporation (Private) Limited, Bangalore, presented a lease deed dated 12-2-1981 executed by him on the same day in favour of M/s. Vanivilas Co--operative Sugar Factory Limited, Hiriyur, Chitradurga District, before the Sub-Registrar, Hiriyur, for registration. The Sub-Registrar impounded the document and in exercise of powers vested with him under S. 33 of the Karnataka Stamp Act, 1957, (hereinafter referred to as 'the Act'), issued notice to the presentant directing him to pay stamp duty of Rs. 11,200/- and, on hearing, levied stamp duty and penalty of Rs. 5/- under the provisions of S. 39 of the Act, by his order dated 6-3-1981. Aggrieved by the said order of the Sub-Registrar and Deputy Commissioner of Stamps, Hiriyur, the party preferred an appeal to the Chief Controlling Revenue Authority on 10-7-1981. The Chief Controlling Revenue Authority took the case on file and issued notice to the presentant on 24-7-1981 fixing the date of hearing on 27-7-1981. On the said date, the Advocate for the petitioner appeared and argued the case submitting that he was liable to pay stamp duty of Rs. 56,000/- only under Art. 30 (a) (iii.) read with Art. 20 of the Schedule to the Act and that the Sub-Registrar wrongly interpreted the document for the purpose of stamp duty. As the Authority felt that the issue involved a substantial question of law, he has made the present reference to this Court under S. 54 (1) of the Act.

( 3 ) IN the opinion of the Chief Controlling Revenue Authority, the recitals in the lease deed show that the lease is for a period of ten years reserving annual rent of Rs. 8,00,000/- and providing for the payment of Rs. 8,00,000/- towards rent in advance, The question is whether the advance payment of Rs. 8,00,000/- is to be construed as advance for the purpose of stamp duty in addition to the rent reserved, attracting stamp duty under Art. 30 (c) of the Schedule to the Act as a lease for money advanced. The Chief Controlling Revenue Authority has opined that in view of the words 'or for money advanced' in Art. 30 (c) of the Schedule to the Act, the payment of rent in advance has to be construed as money advanced and the lease deed is chargeable accordingly. As, however, he was not free from doubt, he has referred the following' questions for the opinion of this Court:- (1) Whether the rent paid in advance is to be construed as money advanced in addition to tent reserved? (2) Whether the advance paid in a lease deed adjustable fully or partially or at the end of the lease period towards rent is to be considered as premium/money advanced in addition to the rent reserved and charged the stamp duty under Art. 30 (c) of the Schedule to the Act? (3) If the document does not fall under any of the categories aforesaid, then what is the correct nature of the deed and what stamp duty is payable thereon?

( 4 ) THE short question, therefore, that arises for our consideration in this reference is: 'whether the amount of Rs. 8,00,000/- paid in advance under the terms of the lease deed is advance payment of rent reserved or it is premium or money advanced for the granting of the lease?'

( 5 ) BEFORE we look at the lease deed, it would be convenient to notice briefly the law pertaining to the concept of fine or premium or money advanced, as contemplated under Art. 30 (c) of the Schedule to the Act.

( 6 ) ARTICLE 30 (c) of the Schedule to the Act reads:"where the lease is granted for a fine or premium or for money advanced in addition to rent reserved. The same duty as a conveyance (No. 20) for a market value equal to the amount or value of such fine or premium or advance as set forth in lease, in addition to the duty which woul