Compliance with statutory adjudication under the Karnataka Stamp Act prevents subsequent impounding by the Court.

ORAL ORDER

Petitioner who is the plaintiff in O.S.No.10124/2015 pending consideration on the file of the City Civil Judge, Bengaluru (herein referred to as 'Trial Court' for short) is before this Court being aggrieved by the order dated 13.10.2020 passed by the Trial Court, in and by which the agreement of sale dated 17.10.2006 produced by the plaintiff has been impounded with the direction for payment of deficit stamp duty of Rs.98,475/- and 10 of times penalty thereon, in all Rs.10,83,225/- within period of one month with a further direction that if said amount was paid, to send a copy of the agreement to the District Registrar for issuance of endorsement under Section 41 of the Karnataka Stamp Act, 1957 (for short 'Act').

2. The above suit is filed by the petitioner/plaintiff seeking specific performance of the aforesaid agreement of sale dated 17.10.2006 against the respondents/defendants. The case of the petitioner/plaintiff is that the said suit was filed on 10.12.2015 and within 5 days thereafter he filed an application under Section 31 of the Karnataka Stamp Act, 1957 seeking adjudication/determination of stamp duty payable on the aforesaid agreement dated 17.10.2006. That upon adjudication of the matter, the District Registrar had directed the petitioner to pay an aggregate sum of Rs.1,96,760/- towards deficit stamp duty and penalty vide order dated 17.02.2016 produced at Annexure-C. That upon payment of the said amount an endorsement as required under Section 41 of the Karnataka Stamp Act 1957 was made on the aforesaid agreement. That when the said document was tendered in evidence the Trial Court vide impugned order dated 13.10.2020 came to the conclusion that since the agreement was of the year 2006 and the deficit stamp duty was paid subsequent to filing of the suit, the payment of such stamp duty penalty was not appropriate and the document could not be held to be duly stamped. Accordingly, proceeded to exercise the power under Sections 33 and 34 of the Stamp Act 1957, resulting in the impugned order.

3. Learned counsel for the petitioner/plaintiff reiterating the grounds urged in the memorandum of petition and taking this Court through the impugned order submits that the petitioner under the law had an option to tender the document for adjudication for the purpose of payment of stamp duty before the District Registrar which is a statutorily conferred right, duly exercised by him and the same cannot be found fault with. He submits the District Registrar in exercise of his powers under Section 31 and Section 39 of the Act has determined the deficit stamp duty and penalty payable thereon which has been promptly paid by the petitioner/plaintiff as seen in the endorsement. He submits once the stamp duty on the document has been duly paid, the Trial Court could not have reopened the matter and called upon the petitioner to pay stamp duty and penalty as done in the instant case. That the said procedure adopted by the Trial Court is one without authority of law.

4. In support of his submission he refers to the judgement of the Apex Court in the case of SEETHARAMA SHETTY VS. MONAPPA SHETTY reported in 2024 SCC Online SC 2320. Referring to paragraph 21.1.1 learned counsel submit that the law in this regard is fairly settled in which the party seeking producing document has an option to voluntarily submit the documents for adjudication of stamp duty or have an option to have the same impounded and determined to the Court. Therefore submitted that the order passed the Trial Court runs contrary to the provisions of Act and law settled by the Apex Court. Hence, seeks for allowing of the petition.

5. Per contra, learned counsel appearing