( 1 ) AN agreement executed on 5/02/1979 between M/s. Vishal Malleables Ltd. , a company registered under the Companies Act, 1956, and having its registered office at G. I. D. C. Industrial Estate, Ankleshwar, District broach (First Part), Gujarat State Financial Corporation (G. S. F. C.- Second Part), gujarat Industrial Investment Corporation Ltd. (G. I. I. C.- Third Part) and the bank of Baroda (Fourth Part), was registered with the Sub-Registrar of ankleshwar on 8/02/1979 at Sr. No. 82. The said instrument was executed by affixing a Stamp Duty of Rs. 10. 00 as if it was an agreement as provided under Art. 6 of the Bombay Stamp Act, 1958 ("the Stamp Act" for short ). At the time of audit of the Sub-Registrars Office, the Deputy accountant General referred to the said instrument and arrived at the conclusion that the instrument was not evidencing the deposit of title deeds or pari passu agreement between the financial institutions and the company but it contained recitals such as : (i) right to sell the property in case of default in payments; (ii) continued security of the property for the amount due; (iii) right to appoint a receiver at any time; and (iv) exercising any other rights conferred, etc. Hence, it was not an instrument to deposit title deeds but it was a mortgage deed. Hence, the document would be liable to Stamp Duty as mortgage deed under Art. 40 of the Stamp Act. A detailed report was submitted by the Deputy Accountant General.

( 2 ) ON the basis of the said report, the instrument was impounded and the matter was referred to the Collector, Broach, for deciding the true nature of the said instrument and also for determining the proper amount of Stamp duty leviable thereon and for taking suitable further action in that behalf.

( 3 ) THE Collector, Broach, by his order dated 28/02/1984, arrived at the conclusion that the true nature of the instrument was that of mortgage deed and determined the amount of Stamp Duty leviable on the said instrument under Sec. 39 (l) (b) of the Stamp Act. He passed an order for recovery of deficit Stamp Duty of Rs. 2,59,720 on the basis of Art. 40 of First Schedule to the Stamp Act and registration fee of Rs. 31,240- together with penalty of Rs. 25,000. 00, that is to say, in all Rs. 3,05,960. - from the company, M/s. Vishal Malleables Limited. Against that order, the company preferred a revision application to the Chief Controlling revenue Authority, Gujarat State, Ahmedabad, under sub-sec. (1) of Sec. 53 of the Stamp Act. After hearing the parties, the Chief Controlling revenue Authority came to the conclusion that a substantial question of law is involved in deciding the true nature of the instrument and determining the proper amount of duty leviable thereon. Hence, the following questions are referred to this Court under Sec. 54 (1) of the Stamp act : (1) Whether the document in question titled as agreement which bears the registered Serial No 82 dated 8/02/1979 executed on 5/02/1979 is a mortgage deed as defined in clause (p) of Sec. 2 of the bombay Stamp Act, 1958; chargeable with duty as per Art. 45 of Schedule i to the said Act; or (2) Whether the said document is an "agreement" chargeable with duty as per Art. 5 (h) of Schedule I to the Bombay Stamp Act. Before referring these questions, the Chief Controlling Revenue Authority has found that by the aforesaid agreement, the company created a joint mortgage by a registered instrument termed as Pari-passu Agreement. Further, he has, inter alia, referred to the terms and conditions of the documents in the statement of case which we would refer to at the later stage. Relevant Provisions of The Stamp Act :

( 4 ) FOR determining the questions referred to in this reference, it would be necessary to refer to the relevant provisions of the Stamp Act. Sec. 2 (p) of the Stamp Act defines the term mortgage deed as under :" (P) mortgage deed includes every instrument whereby, for the purpose of securing money advanced, or to be ad