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Allahbad High Court
K.B.ASTHANA
Guni Ram - Appellant
Versus
Kodai - Respondent
Decided On : 02/15/1971
STAMP ACT - SECTION 35 - ADMISSIBILITY OF EVIDENCE - UNSTAMPED DOCUMENT - EXECUTION OF AGREEMENT - EVIDENCE IN PROOF OF DUE EXECUTION - ADMISSIBILITY.
Fact of the Case:
Plaintiffs sued for specific performance of a contract of sale of certain Bhumidhari plots, alleging that the first defendant executed an agreement to sell his half share in the properties for a consideration of Rs. 4000/- on receiving an earnest of Rs. 1500/- from the plaintiffs, but later executed a sale-deed in favor of the second defendant. The first defendant denied the existence of any agreement to sell, claiming his signatures were obtained under duress on blank sheets. The trial court rejected the agreement as unstamped and dismissed the suit. The lower appellate court admitted the agreement on payment of stamp duty and penalty, reversed the trial court's finding, and decreed the suit for specific performance.
Finding of the Court:
The court held that the evidence adduced by the plaintiffs relating to the execution of the agreement by Guniram cannot be deemed to be a part of the record, and in the eye of law there was no material before the lower appellate court to prove its due execution by Guniram even though the lower appellate court admitted the document paper No. 30/A-1 in evidence on payment of requisite stamp duty and penalty by the plaintiffs.
Issues: 1. Whether evidence in proof of due execution of a document which is produced before the court unstamped, being a document required to be executed on stamped paper under the Indian Stamp Act, can be adduced without the court first admitting it in evidence or acting upon it on payment of the requisite stamp duty and the penalty? 2. Whether the trial court was competent in admitting evidence relating to the due execution by Guniram of the agreement to sell dated 15-6-1964?
Ratio Decidendi: 1. Section 35 of the Stamp Act makes instruments not duly stamped inadmissible in evidence. However, the court can receive evidence of the circumstances under which a particular instrument was prepared and signed. Admitting an instrument in evidence or acting upon it means enforcing rights or title founded on the instrument. Evidence of due execution is not acting upon the instrument as it does not serve as a foundation for any right or title. 2. The court can receive evidence to prove due execution of an instrument chargeable to duty under the Stamp Act, though produced unstamped, but such instrument will not be admitted in evidence or acted upon, i.e., its recitals cannot be used either in favor of the party relying on it or against his adversary.
Final Decision: The court dismissed the appeal, holding that the evidence adduced by the plaintiffs relating to the execution of the agreement by Guniram was admissible, and the omission to mark the document as an exhibit and give it a number was a curable procedural irregularity that did not amount to any illegality.
It was alleged by the plaintiffs that in May, 1964 the Bank agreed to advance the loan to them and paid the first instalment of Rs. 1500/-, armed with which they approached Guniram on 15th June, paid the said sum as earnest, on accepting which Guniram executed the agreement to sell. The balance, of Rs. 2500/-was left to be paid when the sale-deed was executed.
2. The suit was contested by all the defendants, inter alia, it was pleaded by the defendants in their written statement that Guniram had not executed any agreement to sell, his signatures having been obtained under duress on blank sheets which subsequently appears to have been
converted into an agreement to sell his half share in the properties. Thus the defence was a denial of the existence of any agreement to sell.
3. The plaintiff did not file the document evidencing the said agreement along with the plaint. On 17-9-1965 the defendants filed their written statement and on that date the issues were struck. The plaintiffs also filed an application on the same date asking the permission of the court for filing certain documents and in the list appended to the application the agreement alleged to have been executed by Guniram on 15-6-1964 was included. The court granted the application and permitted the documents to be filed by 17-9-1965 on which date the plaintiffs filed the document dated 15-6-1964 alleged to have been executed by Guniram and prayed that the same be kept in a sealed envelope. This document was marked as paper No. 30/A.1 and kept on record. Whether there was any agreement between the plaintiffs and defendant No. 1 for the sale of the property in suit was the main issue for determination in the suit. The parties led evidence in support of their respective cases. Raghoram, one of the plaintiffs, examined himself as a witness. Siaram the scribe of the document, and Harbans, a marginal witness, were also examined.
On behalf of the defendant evidence was led in support of his case that on 26-4-1965 he was ambushed by the plaintiffs, threatened and coerced physically into appending his signatures on three blank sheets. A copy of the report lodged at the Police Station of the incident was also produced. Though in the written statement of the defendants it was said that the document dated 15-6-1964 was not stamped and registered, it does not appear from the record that any objection was raised before taking of the evidence that it was inadmissible in evidence being unstamped.
4. The learned Munsif believed the evi
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