Veeraswami, C.J.- This is a reference under section 57 of the Indian Stamp Act, the question being whether the instrument under consideration is not liable to be stamped under Article 45 of the Stamp Act as a deed of partition, or chargeable to duty as a release. The Revenue contends that having regard to its terms and true intention, the deed is a partition. But, on the other handit is said that inasmuch as one of the sharers was not allotted any joint family property in specie as and for his share, but the agreement was that the other sharers who were to take the entire joint family properties should, in consideration of the sharer releasing his interest in the joint family properties pay a sum agreed upon, the deed operates as a release.

2. There was one B. S. Mallayya who died in January, 1935. He left two sons Sundararaj Mallayya, who died in November, 1936 and Bantwal Anand Mallayya. Bantawl Anand Mallayya has two sons Dinesh Mallayya and Harish Mallayya. Sanjeeva Mallayya and Srinivasa Mallayya are the sons of Sundararaj Mallyya. There was an agreement dated 14th March, 1966, between Sanjeeva Mallayya and his sons on the other the terms of which were that it became expedient and desirable to divide the joint family properties as between the sharers and after prolonged negotiations it was agreed that Sanjeeva Mallayya and Srinivasa Mallayya should be allotted their share of the net assets in the form of cash, freed from any further obligation to discharge the family debts. Accordingly it was provided in the agreement that B. Anand Mallayya described as the first party should pay Sanjeeva Mallayya and Srinivasa Mallayya styled as the second parties Rs. 1,15,750 each as and for his share and that for this’ purpose the second parties authorised the first party to sell any of the joint family immovable properties,. This was followed by a deed described as one of release, which was executed in January, 1967, between the same parties. The deed contained a recital that the properties belonged to the joint family and then the following:

“It was considered desirable and in the interests of good relationship and harmony to partition the assets of the joint family. Sanjeeva Mallayya and Srinivasa Mallayya requested that in the event of a partition their interest in the joint family should be paid to them separately and that the releasees may continue as between themselves as a Hindu undivided family.........The joint family is possessed of two items of immoveable properties listed as items 1 and 2 in Schedule II hereto. The movable properties, namely, shares and liquid cash belonging to the family do not permit of division in such a way that the properties could be divided between the branch consisting of Sundararaj Mallayya and his sons, Bantwal Anand Mallayya and his sons. Sanjeeva Mallayya and Srinivasa Mallayya want their separate interests in the joint family to be handed over to them. There are also liabilities of the joint family listed in Schedule III to this document to be discharged.

In the circumstances, it has become necessary to sell one of the immovable properties of the joint family so that Sanjeeva Mallayya and Srinivas Mallayya could be paid their interests in the joint family..............It was agreed that both Sanjeeva Mallayya and Srinivas Mallayya, the releasors herein, should be paid an ascertained, amount, namely, Rs. 1,15,750 each as representing their interests in the joint family assets leaving it to the releasees either to sell the assets or pay them the amount representing their interests in the assets.”

The operative part of the deed says:

“Now this deed of release witness that in consideration of these presents and in consideration of the sum of Rs. 1,15,750.. paid to each of the releasors herein, the receipt of which sum of Rs. 1,15,750 each of the releasors hereby acknowledges the releasors hereby release and relinquish in favour of the releasees all their interests in the properties mentioned in Schedul

Click Here to Read the rest of this document