A power of attorney granted for valuable consideration and authorizing the attorney to sell immovable property falls under Article 48(e) of Schedule I of the Indian Stamp Act.

RAMAKRISHNAN, J. :- This is a reference under Sec. 57 of the Indian Stamp Act, 1899. The following question has been referred to us for decision :

"Whether the document dated 13-8-1957 is an instrument given for consideration and authorising the attorney to sell any immovable property falling under Art. 48(f) of Sch. 1-A (now Article 48(e) of Schedule (1) or a mere power of attorney falling under Article 48(d) of Schedule 1-A (now Article 48(c) of Schedule I of the Indian Stamp Act as amended)". Annamalai and Co. (Pvt.) Ltd., the respondent herein, borrowed several sums of money from Reliance Bank of India, Ltd., and hypothecated with the Bank immovable properties as security for the loan. Thereafter, on 13-8-1957, Annamalai and Co. executed a document, described as an irrevocable power of attorney, which is the subject-matter of the present reference. The gist of the document is this.

2. Annamalai and Co. to be described as the borrowers, agreed with the Board of directors of the Bank on 8-8-1957 to give to the Bank an irrevocable power of attorney in their favour to sell at the discretion of the Bank the scheduled properties and credit the sale proceeds therefrom to the account of the borrowers in the Bank and also to collect the rents from the properties, lease them out and to credit the income therefrom to the said account less taxes that may be paid thereon, till the dates of sales of the said properties. In pursuance of the above agreement the Borrowers executed on 13-8-1957, the document under consideration, as an irrevocable power of attorney in favour of the Bank with authority to sell the properties mentioned in the schedule and to collect the rents therefrom and pay the taxes thereon till sales. Thereafter, the document catalogues the details of the power granted by the borrowers to the Bank in pursuance of the power of attorney, under four headings. They include the power to collect rents, the power to lease, the power to sell the properties, the power to prosecute or defend legal proceedings touching any of the matters aforesaid. The document concludes with the statement that the power shall be irrevocable till the scheduled properties were sold or till all the accounts were closed, whichever happened earlier.

3. According to the Board of Revenue, the referring authority, this document has to be stamped under Article 48(e) of Sch. I of the Stamp Act, which is in the following terms -

"Power of attorney when given for consideration and authorising the attorney to sell any immovable property :

The same duty as a conveyance for the amount of the consideration".

On the other hand, the claim of the respondent, the borrower and executant of the document, about the proper article of the Stamp Act to be applied, was Article 48(e), which refers to a power of attorney authorising not more than five persons to act jointly and severally in more than one transaction or generally for, which document the stamp duty payable is Rs. 11-25.

4. Before dealing with the question above mentioned, a brief reference to the history of Article 48(e) will not be out of place. This article was formerly Article 48(f) of Sch. I-A of the Stamp Act introduced therein by an amendment. A commentator (K.J. Aiyar) on the Indian Stamp Act has observed that the addition of Section 48(f) to Sch. 1-A was made probably in consequence of an unreported decision of a Bench of this Court in R.C. No. 14 of 1891 (Mad). We sent for and perused this judgement. In that judgement it was observed that where a document on the face of it, was a power of attorney authorising the sale of certain immoveable property in consideration of a certain sum of money borrowed by the executant under a promissory note and of the deposit of the title deeds of the property, the document was held not to be a mortgage but only a power of attorney requiring one rupee stamp on the ground that no right to retain the sale proceeds could be necessarily inferred. The same commentator obser