IN THE HIGH COURT OF MADHYA PRADESH
SUBODH ABHYANKAR, J.
KISHANALAL – Appellant
vs.
ASHOK KUMAR – Respondent
Misc. Petition Nos. 6310 of 2022 and 904 of 2023
Decided on : 13-04-2023
Stamp Duty - Specific Performance of Contract - Indian Stamp Act, 1899, Section 49 of the Registration Act, 1908 - Article 6 of Schedule 1A - The court discussed the proper stamp duty on the agreement, the necessity of registration of the document, and the interpretation of Section 49 of the Registration Act. The court held that the agreement required stamp duty as per Article 6 of Schedule 1A and that registration was not necessary for a suit for specific performance of contract.
Fact of the Case:
The plaintiff filed a suit for specific performance of an agreement against the defendant. The defendant objected to the admissibility of the agreement, claiming it was not properly stamped or registered.
Finding of the Court:
The court found that the agreement was properly stamped as per Article 6 of Schedule 1A and that registration was not necessary for a suit for specific performance of contract.
Issues: The issues revolved around the proper stamp duty on the agreement and the necessity of registration for the document in a suit for specific performance of contract.
Ratio Decidendi: The court held that the agreement required stamp duty as per Article 6 of Schedule 1A and that registration was not necessary for a suit for specific performance of contract.
Final Decision: The defendant's petition was dismissed, and the plaintiff's petition was partly allowed, with the court holding that the agreement was filed for the main purpose of the suit and was not required to be registered.
JUDGMENT :
1. This order shall govern the disposal of M. P. No. 6310/2022, and M. P. No. 904/2023 as both the misc. petitions filed under Article 227 of the Constitution of India, have arisen out of the order dated 22-11-2022, passed in case No. RCSA/57/2020 by the First Civil Judge, Kannod, District Dewas (M.P.).
2. The Misc. Petition No. 6310/2022 has been filed by the defendant, whereas, the Misc. Petition No. 904/2023 has been filed by the plaintiff. In brief, the facts of the case are that the respondent/plaintiff has filed a suit for specific performance of agreement dated 14-6-2018, against the defendant, in which, the plaintiff’s evidence is being recorded and when the agreement dated 14-6-2018 was being exhibited in the trial Court, an objection was raised by the defendant that the same cannot be exhibited for the reason that it is neither properly stamped nor it is registered. The aforesaid objection of the defendant has been rejected by the learned Judge of the trial Court holding that the agreement is written on stamp papers of Rs. 1,000/- which is proper stamp duty. So far as the objection regarding registration of the document is concerned, it is held that since the agreement is being used for collateral purposes, its registration is not necessary.
3. Shri A. S. Garg, learned senior counsel for the petitioner/defendant appearing in Misc. Petition No. 6310/2022 has submitted that the Court has erred on both the counts for the reason that the agreement is liable to be stamped @1% of value of the agreement as per Schedule 1-A, Article 5(e)(ii) of Indian Stamp Act, 1899 which provides 1% stamp duty on an agreement to sale where the possession is not delivered, whereas regarding the compulsory registration of the document agreement to sale is concerned, counsel has relied upon the decision delivered by the coordinate Bench of this Court in the case of Gordhan vs. Dinesh and others, reported in and Shanti Bai vs. Ratna Bai, reported in. Thus, it is submitted that the impugned order be set aside, and the objection raised by the defendant regarding the admissibility of the document be allowed.
4. Shri D. S. Kale, learned counsel for the respondent/plaintiff (petitioner in M. P. No. 904/2023) has although opposed the prayer of the counsel for the petitioner/defendant, however, it is also submitted that the impugned order is erroneous so far as it reflects that the registration of the agreement to sale is not compulsory when it is not being used for collateral purposes. It is submitted that in a suit for specific performance of contract, the contract is used for the main purpose and not for the collateral purposes, thus, it is submitted that the impugned order be modified to that extent and it be held that in a suit for specific performance of contract, the contract is for the main purpose of the suit only and that is not required to be registered which is also the mandate of section 49 of the Registration Act, 1908. Regarding the registration of the document, counsel has also submitted that the law is well settled that in specific performance of contract suit registration of the contract/agreement is not necessary which has also been held by this Court in the case of Manish and another vs. Anil Kumar and others, reported in. Counsel has also submitted that in the aforesaid decision also, this Court has relied upon the various decisions of the Supreme Court.
5. So far as the proper stamp duty on the agreement dated 14-8-2018 is concerned, Shri Kale has also drawn the attention of this Court to the old provisions of the Stamp Act which were in force from 2-8-2008 to 15-9-2014, provided that as per Article 5(e)(ii), when possession of the property is not given, the stamp duty payable is 1%, whereas the aforesaid provision has been amended since then in the year 2015, and Article 5 has been renumbered as Article 6 which provides Rs. 1,000/- stamp duty where the possession of the property is not given, and which duty has been paid
The trial Court has discretion to deny document production in a specific performance case; unregistered agreements can serve as evidence if possession was not delivered.
Admissibility of unregistered document in suit for specific performance based on Registration Act and Stamp Act
An unregistered document can be admissible in a suit for specific performance, and a plaint cannot be rejected solely on the grounds of non-registration or insufficient stamp duty without trial evide....
Unregistered agreements for the sale of property without possession delivery are not conveyances and do not require stamping, valid for evidence in specific performance cases.
Proper stamping and registration are essential for the admissibility of unregistered documents affecting immovable property as evidence in a suit for specific performance. The court has a duty to dec....
The main legal point established in the judgment is that an unregistered sale deed may be admissible as evidence of an agreement to sell in a suit for specific performance under the Specific Relief A....
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