An agreement to sell evidencing delivery of possession is subject to the same stamp duty as a conveyance, and the imposition of a penalty for insufficient stamping is discretionary based on intent.

Deepak Gupta, J.:-

This is plaintiff’s revision against order dated 19.03.2025 (Annexure P-3) passed by learned Civil Judge (Junior Division), Malerkotla, whereby he (plaintiff-petitioner herein) has been directed to pay deficiency of stamp fee on the agreement to sell dated 15.04.2014 along with the penalty of 10 times the deficiency, in Civil Suit bearing CNR N: PBSGCO-001565-2018 titled ‘Ram Lubaya vs. Rajesh etc.’

2. Plaintiff filed a suit for possession/joint possession in respect of a plot measuring 233 sq. yard as per the details provided in headnote of the plaint, based upon an agreement to sell dated 15.04.2014 and the writings dated 16.06.2014, writing dated 15.12.2014, writing dated 27.04.2015 and writing dated 29.10.2015. As per the agreement to sell relied by the plaintiff, total sale consideration is Rs. 13,00,000/-, out of which an amount of Rs. 9,00,000/- has already been paid as earnest money. The agreement to sell also stipulates that possession was delivered to the plaintiff at the time of agreement.

3. During his evidence, plaintiff produced the above said agreement to sell dated 15.04.2014 as Ex.P-3 but before the starting of his cross-examination, objection was raised by defendant No.1 regarding inadmissibility of the said agreement on the ground that it was insufficiently stamped and so, the same was liable to be impounded. Said defendant No.1 also moved a separate application (Annexure P-1) for impounding the said alleged agreement to sell dated 15.04.2014 and collecting the deficient stamp duty along with the penalty thereon; and in the alternative to declare the said agreement to be inadmissible in evidence. Plaintiff-petitioner herein opposed the application.

4. However, the trial Court by way of the impugned order has disposed of the application in the following terms:

“Thus, the plaintiffs have to affix the stamp duty on the market value of the property in dispute. But the document is only stamped with Rs. 2000/- stamp fees. Hence, there is deficiency of stamp fees. As per the provisions of Section 35 of Stamp Act 1899, the person, who is relying upon the said document is also required to pay penalty 10 times of the amount of the deficient portion of the stamp duty. Hence, penalty of 10 times of the amount of the deficient portion of the stamp duty is also imposed upon the plaintiff. In view of discussion made above, one opportunity is granted to plaintiff to deposit the deficiency of stamp fee along-with penalty which is 10 times the deficiency as mentioned above up to 28.04.2025 and in case plaintiff does not pay the required stamp duty, the document i.e. agreement to sell dated 15.04.2014 shall be impounded and will sent to Collector for collection of deficiency in stamp duty as per provisions of Section 35 read with Section 47A of Indian Stamp Act 1899 and in case plaintiff fails to make the deficiency in stamp duty good along-with penalty as mentioned above, the document cannot be allowed to be exhibited and will not be relied upon. Application stands disposed of accordingly.”

5. Assailing the aforesaid order, it is contended by learned counsel for the petitioner-plaintiff that application was moved at the belated stage; that defendant No.1 was not the owner of the property in dispute at the time of execution of the agreement to sell dated 15.04.2014 and the outcome of the said agreement is dependent upon the final outcome of the agreement to sell executed by defendant No.2 in favour of defendant No.1. In case, defendant No.1 does not succeed in getting the ownership on the basis of agree