2012 Supreme(Kar) 601

KARNATAKA HIGH COURT
N. Kumar and B.V. Pinto, JJ.
Digambar Warty and Others – Appellants
Versus
District Registrar, Bangalore Urban District, Bangalore and Another – Respondents
Writ Appeal No. 885 of 2008 and Writ Appeal Nos. 2062-2106 of 2008 connected with Writ Appeal No. 870 of 2008 and Writ Appeal Nos. 2479-2538 of 2011 (GM-ST/RN)
Decided on: 7.12.2012

Headnote:INTERPRETATION OF STATUTES - Definition of a word: [N. Kumar & B.V. Pinto, JJ] The Legislature has the power to define a word given artistically. When a word is defined to mean such and such, a definition is prima facie restricted and exhausted, where as defined includes such and such, the definition is prima facie extensive. The word includes is often used in interpretation clause notwithstanding the meaning of the words or phrases occurring in the body of the statute. It is so used, these words and phrases must be construed as comprehending not only such things as they signify according to their nature and purpose, but also those things, which the interpretation clause declares, they shall include. When a word is defined to bar a number of inclusive meanings, the sense in which the word is used in a particular provision must be ascertained from the context of the scheme of the Act, the language of the provision and the meaning intended to be served thereby.

       KARNATAKA STAMP ACT, 1957 - Sections 2(1)(d), 2(1)(gg), 2(1)(j) & 3 r/w Article 20(2) of Schedule: [N. Kumar & B.V. Pinto, JJ] Allotment of flats constructed by "Tenant Co-operative Housing Society" to its tenant members - Claim for exemption from compulsory registration of and payment of stamp duty on instrument - Flats constructed by Society on land belonging to third party, taken on long-term lease, allotted to members holding fully subscribed "loan stock certificate" of amount equivalent to cost of flat allotted, by issuing "possession certificate" - Exemption claimed on ground that "possession certificate" under which allotment is made, is not deed of conveyance as it does not convey title to member-allottee and what is conveyed is only right of occupation and user of flat and that ownership of flats continues to vest in society - Held, Since what is transferred under "Possession Certificate" is heritable and transferable right relating to benefit arising out of land, it amounts to conveyance of immovable property and attracts payment of stamp duty under Article 20(2) of Schedule of the Act. Exemption claimed, is not tenable. Order of Single Judge was upheld.

       KARNATAKA STAMP ACT, 1957 - Section 2(1)(gg): [N. Kumar & B.V. Pinto, JJ] "Immovable property" - Held, Extensive definition of expression must be construed as comprehending not only such things as they signify according to nature and purpose of those things, but also those things which definition declares, they shall include. Thus immovable property does not cover only lands and buildings, but also benefits arising therefrom.

       KARNATAKA STAMP ACT, 1957 - Sections 33, 67 & 67-B: [N. Kumar & B.V. Pinto, JJ] Impounding of documents required to be stamped, not stamped or insufficiently stamped - Held, Section 67 provides for impounding of the instruments under Section 33, whereas Section 67-B empowers the authorities to enter upon the premises, inspect certain documents and seize and impound them under Section 33. If the document is impounded under Section 67 -B, sub-section (2) of Section 67-B provides that the authority shall require the person liable to pay the proper duty or the amount required to make up the same and also penalty not exceeding five times the amount of the deficient duty thereof if any leviable and in case of default the amount of duty and penalty shall be recovered in accordance with Section 46. Therefore, the law makes a distinction insofar as payment of penalty is concerned, between the documents which are sought to be tendered by way of evidence and documents which are seized by the authorities under Section 67-B of the Act. If a person wants the document to be admitted in evidence or tendered in evidence, the penalty payable is ten times, however, subject to reduction of the said penalty at the discretion of the Deputy Commissioner. If the party is not volunteering to produce the said document, but seized by the authorities, then the penalty to be imposed should not exceed five times the duty payable. If the authority finds that the document is not stamped or insufficiently stamped, the power is conferred on the authority to seize the said instrument and then adjudicate the duty payable under Section 37 of the Act and then recover the same under Section 46 of the Act. No time-limit is prescribed for impounding of the document and for adjudicating the duty payable on such instruments. The question of limitation arises only when the duty is recoverable, because neither the act of impounding the document nor adjudicating the duty payable would affect the person, who is claiming property under the instrument. It is only when the duty so determined is sought to be recovered under Section 46 of the Act by employing coercive measures, his right is said to be affected.

       KARNATAKA STAMP ACT, 1957 - Sections 34 & 46-A: [N. Kumar & B.V. Pinto, JJ] Inadmissibility of instruments not duly stamped in evidence - Held, If an instrument which is compulsorily registrable but on which the person relies on to prove his title, and it is to be tendered in evidence in a Court of law, unless the proper stamp duty and penalty payable thereon is paid, it is inadmissible. Therefore, the said document would be of no use to enforce a right of such a person. If the documents require registration i.e., compulsory registration, unless the document is registered, there is no transfer of interest in an immovable property. Even though the authorities are prevented from recovering the stamp duty payable on such instrument for non-payment of stamp duty, for non-registration of the said document, the said document In the eye of law, has no value. Therefore, the provisions contained in Sections 33 and 67 make it clear that even though the revenue is prevented from collecting the revenue, the person claiming right under the instrument is given an opportunity to pay duty, penalty and get the document registered. Even though the authorities cannot recover the duty payable, the aforesaid documents, in the absence of being duly stamped and registered, do not confer any title on the writ petitioners in respect of an immovable property. If they have already sold their interest in the property under the registered Sale Deed, the purchaser gets no title because the seller acquired no title. Therefore, as a duty is cast on the seller to make good the title of the purchaser, even in the absence of the authority enforcing the right to recover the stamp duty, if proper stamp duty and penalty is paid, along with registration fee, it could be registered. That is the object behind this legislation.

       KARNATAKA STAMP ACT, 1957 - Section 46-A: [N. Kumar & B.V. Pinto, JJ] Limitation for recovery of stamp duty not levied or short levied - Held, Question of limitation would arise for consideration only when demand is made and recovery is enforced, and not till then. In the instant case, all the documents under which the immovable property was transferred in favour of the writ petitioners came to be executed in the year 1987. Five years is the period prescribed for recovery of the deficit stamp duty from the date of execution. The proceedings should have been initiated on or before 1992. Admittedly, the proceedings are initiated in the year 2004. Therefore the bar of limitation prescribed under Section 46-A is applicable. The proceedings under Section 46-A to recover the stamp duty is clearly barred by legislation.