IN THE HIGH COURT OF DELHI AT NEW DELHI
S. RAVINDRA BHAT, VALMIKI. J. MEHTA, R.K. GAUBA, JJ.
Indu Singh and Anr. - Plaintiffs
Versus
Prem Chaudhary and Ors. - Defendants
O. REF. 2 of 2018 IN CS(OS) 1098 of 2005
Decided On : 11-05-2018
Civil Procedure Code, 1908 - Order 20 Rule 18(2) - Stamp Act, 1899 - Section 2(15) - Article 45 of Schedule I - Partition suit - Stamp duty - Liability to pay - Liability to pay stamp duty on a sale deed is distinct from liability in respect of an instrument of partition - Discharge of the former cannot be treated as discharge of the latter - In the event of distribution of sale-proceeds being the mode of partition, the liability to pay stamp duty would arise when the court passes the final order dividing the consideration - Such order being the instrument of partition - Proceeds being receivable only after payment of stamp duty.
Stamp Act, 1899 - Section 2(15) - Article 45 of Schedule I - Partition suit - Order for sale of the property - Nature of decree - Interpretation of - Final order to sell the property is made, the decree becomes executable - Postponement of such event by inaction of the party does not result in the limitation being suspended as it were - If the party entitled to seek sale, through execution, unduly delays in approaching the court, by delaying affixing the applicable stamp duty runs the risk of running afoul of the provisions of law relating to limitation - Decision of the court results in finality bears the characteristic of a final decree - Such decree has to be engrossed with stamp paper of the appropriate value - Proceedings by way of execution for effectuating the sale, are to be initiated by the party which seeks sale and division of the proceeds, in ultimate satisfaction of the decree. (By S. Ravindra Bhat, J.)
Stamp Act, 1899 - Section 2(15) - Article 45 of Schedule I - Final decree - Enforcement of rights - Sale of property - Scope of - Section 2(15) of the Stamp Act - Order of sale which is passed in a partition suit is a final decree - Final decree is a final order of partition - Final decree of partition will have to be stamped as per Article 45 of Schedule I of the Stamp Act - In proceedings for enforcement of rights under a final decree of partition will be by execution proceedings of the final decree of partition - Steps for sale of the joint property will be steps in execution of the final decree and would not be steps prior to the passing of the final decree - An order of sale passed under Section 8 of the Partition Act is a final decree - No further rights are required to be adjudicated. (By Valmiki. J. Mehta, J.)
S. RAVINDRA BHAT, J.
1. This judgment by the Full Bench is pursuant to a reference by a learned single judge, on two issues:
(i) When an order for sale of the property/properties is passed in a partition suit, whether such an order of sale is a final decree of partition or is just another preliminary decree passed after passing of the earlier preliminary decree declaring the shares of the parties in the property/properties of the partition suit.
(ii) On the answer to the aforesaid issue being given, a further consequential issue will have to be examined that if the order of sale is a final decree, then in such a case whether this final decree will be an “Instrument of Partition” as defined in Section 2(15) of the Indian Stamp Act, 1899 and which “Instrument of Partition” is required to be stamped as per Article 45 of Schedule I of the Stamp Act.
2. I have had the benefit of going through the judgment of the other two judges. I agree with the judgment authored by Valmiki. J. Mehta, J which elaborately discusses the various nuances of provisions of the Partition Act, the Civil Procedure Code (CPC) and the Stamp Act as well as their interface with each other. I agree with the conclusions and most significantly, that by reason of Section 8 of the Partition Act, a determination or order that furthers the preliminary decree in a partition suit (by deciding if a property can be in fact divided by metes and bounds) amounts to a final decree, the rights under which are to be worked out by the parties concerned through an execution proceeding. Consequently, the plaintiff’s contention that the suit has to be given a closure only and only if the parties are actually put to possession of their respective shares (in the case of partition of property) or after the conduct of auction or other sale process, is negatived.
3. I however, append some additional reasons to arrive at the same conclusions. A repetition of the facts, which led to the reference to the Full Bench, or an outline of the statutory provisions, is unnecessary. At the same time, I am not convinced that the reference to the right of a joint owner who held a moiety as a statutory gap is justified. I say this because at the turn of the century, and till the mid twentieth century, a joint or undivided Hindu family was a stronger social and economic unit than it is now. Therefore, it would be fair to assume that disruption of such a unit was not thought to be a light matter; perhaps the lawmakers underlined the strength of the unit, by enjoining that to sue under the Partition Act, one had to possess a moiety. These observations are however, not essential to the main point of reference. The reasons for this concurrence are set out hereafter.
4. There is clear authority for the proposition that when disputants in a partition suit, enter into an agreement which is embodied in a compromise decree, that decree is to be treated as a final decree. This was so declared in Renu Devi v. Mahendra Singh and Ors AIR 2003 SC 1608 as well as in Rachakonda Venkat Rao and Others v R. Satya Bai (Dead) by L.Rs. and Another (2003) 7 SCC 452. In Renu Devi (supra), the Supreme Court, after discussing the previous case law and the nature of the compromise which was embodied in a decree, observed as follows:
“A preliminary decree declares the rights or shares of parties to the partition. Once the shares have been declared and a further inquiry still remains to be done for actually partitioning the property and placing the parties in separate possession of divided property then such inquiry shall be held and pursuant to the result of further inquiry a final decree shall be passed. A preliminary decree is one which declares the rights and liabilities of the parties leaving the actual result to be worked out in further proceedings. Then, as a result of the further inquiries conducted pursuant to the preliminary decree the rights of the parties are finally determined and a decree is passed in accordance
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