The transfer of trusteeship is deemed a 'settlement' under Article 58(ii) of the Indian Stamp Act, affirming that no conveyance occurred, but rather a handing over of management for charitable purposes.

JUDGMENT :

MOHAMMED SHAFFIQ, J.

1. Writ Appeal is filed by the State challenging the order of the learned Single Judge dated 04.03.2011 insofar as it set aside the order dated 22.02.2010 and treating/finding Document dated 01.03.1999 bearing No.4240 of 2002 titled as “Transfer of Trusteeship Declaration” dated 26.07.2002 as covered under Article 62(e) of the Stamp Act while rejecting the contention of the State, i.e., appellant herein that the document/Deed of “Transfer of Trusteeship Declaration”, (hereinafter referred to as “Subject Deed”) would be covered under Article 58(a)(ii) of the Indian Stamp Act (hereinafter referred to as 'Stamp Act').

2. Brief facts:-

2.1. For sake of convenience, the parties are referred to as per their rank set out in the writ petition.

2.2. Petitioner is a religious and charitable institution registered under the Societies Registration Act. Petitioner is primarily engaged in charitable works. Christu Kula Charitable Trust a registered Trust (hereinafter referred to as 'Trust'), an Ashram, ran an orphanage to help destitute and deserted children. The purpose of the Trust is to render selfless service to sick and poor, especially, villagers. Trust also had as its object, establishment of Educational Institution. Trust properties / money was, held by trustees who were to be appointed by Sevaks. Trust was to have five trustees, three from Ashram's Sevaks and two from outside the Ashram. Trust Deed provided that if Ashram Sevaks find themselves unable to run one or both of these institutions, i.e., hospital (or) school, they may discontinue either one or both, for such time as may be required. If at any time, Trust is dissolved or discontinued, Trust Deed provides that Rs.3,00,000/-, reserved for the Hospital and Rs.50,000/- for the school, shall be handed over to National Missionary Society of India, i.e., petitioner, to be used for the purposes set out in Appendix 'A' Rule X of Trust Deed.

2.3. Trustees faced difficulties in discharging their obligation primarily due to their old age. It was thus decided to handover the Management or Trusteeship of the Trust in the manner provided under the Trust Deed. Pursuant thereto, a resolution dated 26.02.1999 was passed and “Subject Deed” was executed by the Christu Kula Ashram Trust represented by its Trustees in favour of the petitioner Society, which was referred as Transferee Trustees and represented by its Governing body.

3. The above “Subject Deed” dated 01.03.1999 inter alia provided for the following:

a) Christu Kula Ashram Trust resolved to merge with the National Missionary Society of India.

b) Properties of the above Trust mentioned in the Schedule to the above Deed was to be vested with the Transferee Trust (or) Trustee i.e., the petitioner herein, who shall hold the same for the purposes and objectives of the Trust for which the transferor trustees were holding the same until the date of execution of the said Deed.

4. The Subject Deed was presented for registration by paying duty of Rupees 300/- (Rs.90+210). However, Registering Authority demanded a sum of Rs.70,000/- as deficit stamp duty vide letter dated 26.04.2001. Thereafter, notice dated 04.06.2004 was issued and a further sum of Rs.21,16,779/-, comprising of Rs.19,16,779/- towards duty and Rs.1,53,000/- towards penalty, was demanded. It is stated that the Accountant