Documents not duly stamped are inadmissible in evidence for any purpose under Section 35 of the Indian Stamp Act, including collateral purposes.

(ORDER)

By the instant petition filed under Article 227 of the Constitution of India, the petitioners/plaintiffs are questioning the validity of the order dated 25.01.2017 (Annexure-P/1) whereby the trial Court partly allowed the application preferred by the defendants filed under Section 151 of the Code of Civil Procedure .

2. Facts of the case in nutshell are that a civil suit was filed by the plaintiffs/petitioners for recovering the amount of Rs.37,50,000/- along with interest of Rs.13,50,000/-. The claim of the plaintiffs was based upon the fact that defendant No.1 (Rambhuwan Singh) who later on died, entered into an agreement with the plaintiffs and defendant No.2 (Hari Prasad Gupta) and pursuant thereto, an agreement to sale of the land described in paragraph-1 of the plaint got executed on 25.05.2011 on consideration of Rs.7,50,00,000/- and out of the said amount, Rs.50,00,000/- was received in advance in which Rs.42,00,000/- was given in cash whereas Rs.8,00,000/- was given through cheque bearing No.563676 of Union Bank of India by plaintiff No.2 before two witnesses. The said agreement got notarized at Rewa. Out of Rs.50,00,000/- 25% of the amount which came to Rs.12,50,000/- was paid by plaintiff No.1; 50% of the amount i.e. Rs.25,00,000/- was paid by plaintiff Nos.2 and 3 and 25% of the remaining amount which came to Rs.12,50,000/- was paid by defendant No.2 namely Hari Prasad Gupta.

(2.1) After coming to know about the fact by the plaintiffs that the land for which agreement to sale got executed has already been acquired by an industry of Bihar and the name of that industry also got mutated in the revenue record, the plaintiffs demanded their money back from defendant No.1 (Rambhuwan Singh), who despite giving assurance, did not return the money to the plaintiffs. Thereafter, a notice was issued to him and finally, suit was filed by the plaintiffs for recovering the money paid by them to defendant No.1.

(2.2) During pendency of suit, an application under Section 151 of the CPC was filed by defendant Nos.1 and 3 raising an objection therein that the agreement dated 25.05.2011 is inadmissible as the same is not registered whereas it needs to be registered and stamp duty @12% of the total amount of sale consideration requires to be paid. The defendants had also requested the Court below to get the said document registered after paying requisite stamp duty by the plaintiffs.

(2.3) In turn, the trial Court vide order dated 25.01.2017 partly allowed the application filed by the defendants observing therein that as per Section 35 of the Indian Stamp Act, 1899 (in short the Act, 1899) any document not properly stamped cannot be used in evidence for any purpose and as such, as per the trial Court, agreement dated 25.05.2011 is inadmissible even for collateral purpose. The trial Court, therefore, directed the plaintiffs to proceed further so as to get agreement dated 25.05.2011 properly stamped and also directed to forward the same to the Collector, Stamps for determining proper stamp duty. Challenging the order dated 25.01.2017, this petition has been filed.

3. Mr. Dubey, learned counsel for the petitioners has submitted that the impugned order is under challenge mainly on the ground that the document i.e. agreement to sale is being used for collateral purpose only and the suit for recovery was filed by the plaintiffs seeking refund of money which was paid by them to defendant No.1 (Rambhuwan Singh). He has submitted that even an unregistered document can be used for collateral purpose because the plaintiffs are not claiming any right over an immovable property, but they are only asking recovery of the amount paid by them to defendant No.1 (Rambhuwan S