( 1 ) THIS petition is directed against an order dated 7-5-2008 by 1st Additional District Judge, Balaghat in civil suit no. 7-A/2007 by which the trial Court decided the objection of petitioner/defendant in respect of insufficiency of stamp duty on agreement dated 22-11-2005.

( 2 ) LEARNED counsel for petitioner submitted that the order of trial Court is not correct, as it has been passed ignoring the provisions as contained in Article 5 of Schedule 1-A of the Indian Stamp Act, 1899 (hereinafter referred to as 'act' for short ). It is submitted that as per Article 5 (2) (e) of the Act the stamp duty was payable @ 1% of the total consideration of the property set forth in the agreement or memorandum of agreement, but the court below erred in directing recovery of deficit stamp duty on the basis of earnest money paid at the time of agreement and not on the basis of total consideration of the property set forth in the agreement.

( 3 ) LEARNED counsel for respondents opposed the aforesaid contention and submitted that the order passed by the trial Court is just and proper.

( 4 ) TO appreciate the rival contentions of the parties it would be appropriate if the factual position in the case is stated. The petitioner herein is defendant in civil suit No. 7-A/2007 pending before the 1st Additional judge to the Court of Additional District judge, Balaghat, between the parties. The respondents filed a suit for specific performance against the petitioner herein on the basis of an agreement dated 22-11-2005, by which a house property situated on Nazul sheet No. 16-D, plot No. 57 area 268 sq. meter was agreed to be sold, the sale consideration was fixed @ Rs. 225/- per sq. ft. , earnest money of Rs. 2,00,000/- was paid at the time of execution of agreement and remaining consideration was to be paid at the time of sale deed after ascertaining the total consideration on measurement of the house.

( 5 ) BEFORE the trial Court petitioner herein raised an objection that the document agreement, Annexure P-1 of this petition, is on insufficient stamp duty. The trial Court after hearing both the parties found substance in the contention of the petitioner herein and directed the plaintiff to make payment of stamp duty on the amount of earnest money rs. 2,00,000/- @ 1% and after deduction the amount of stamp duty already paid Rs. 100/-, the trial Court directed that Rs. 1,900/- is the deficit stamp duty and by imposing penalty 10 times to the duty Rs. 19,000/-, total amount was directed to be paid by the respondents. This order is under challenge in this petition.

( 6 ) TO appreciate the contention of petitioner, relevant provision as contained in article 5 (e) of Schedule 1-A of the Act may be looked into, which reads as under : (e) If relating to sale of immovable property:

(i) When possession of the property is delivered or is agreed to be delivered without executing the conveyance the same duty as a conveyance (No. 20) on the market value of the property. (ii) When possession of the property is not given. One per cent of the total consideration of the property set forth in the agreement or memorandum of agreement.

( 7 ) THE aforesaid provision specifically provides that the stamp duty of agreement or memorandum of an agreement when possession of the property is not given shall be @ 1% of the total consideration of the property set forth in the agreement. The aforesaid provision is very clear and provides payment of stamp duty of 1% of the total consideration of the property set forth in the agreement. The trial Court ignoring the aforesaid provision directed payment of deficit stamp duty on the basis of earnest money paid in the agreement.

( 8 ) THE aforesaid order is apparently contrary to the statutory provision as contained in Article 5 (e) of Schedule 1-A of the Act and is not sustainable under the law. As the stamp duty is to be calculated, after calculating the total consideration as set forth in the agreement, we find it proper to r