SUMAN Vs. VINAYAKA

JUDGEMENT

(1.) Petitioner who is defendant 1 in O.S. No. 805 of 2009 is seeking for quashing of order dated 20-11-2010 Annexure-C passed by Civil Judge (Junior Division), Dharwad and order dated 18-1-2011 passed by the District Registrar, Dharwad, at Annexure-D whereunder Trial Court has held that agreement of sale dated 23-3-2000 is insufficiency stamped by order dated 20-10-2010 and has directed the registry to refer the said document to the Sub-Registrar, Dharwad, to collect deficit stamp duty and subsequently by impugned order dated 20-11-2010 referred the said agreement of sale to the District Registrar, Dharwad, to collect stamp duty as per law. Pursuant to which District Registrar by order dated 18-1-2011 Annexure-D has impounded the document under Section 33 of the Karnataka Stamp Act, 1957 (hereinafter referred to as 'Stamp Act' for brevity) and ordered for collection of stamp duty of Rs. 30,000/- under Article 5(e)(i) by levying penalty of Rs. 5,000/- in exercise of his power under Section 39 of the Karnataka Stamp Act, 1957. It is contended by Mr. Aravind D. Kulkarni, learned Counsel appearing for the petitioner that under Section 33 of the Karnataka Stamp Act, 1957 when a document which is insufficiently stamped or not duly stamped is produced in a proceedings before Court, it has to be impounded by such Court itself and duty and penalty is to be collected and as such Trial Court could not have referred the same to the District Registrar, Dharwad, for calculation of stamp duty with penalty. He would also contend that proviso to Section 34 of the Act makes it clear that while impounding a document, Court has no discretion except to impose penalty of 10 times the proper duty or deficient portion thereof, since Section 34 of the Act mandates that no document can be admitted in evidence for any purpose unless it is duly stamped under Section 34 of the Act. As such, he contends Court below committed an error in referring the disputed document to the District Registrar, Dharwad for collecting the duty since Section 43 of the Stamp Act does not envisage any such reference. He would further contend that District Registrar without giving notice to the parties and without hearing the parties has proceeded to collect the stamp duty exercising his discretionary power under Section 39 though he did not have jurisdiction to impose lesser penalty and same is impermissible in law. On these grounds, he seeks for setting aside the order dated 20-11-2010 Annexure-C passed by the Trial Court as well as the consequential order of determination by the District Registrar, Dharwad dated 18-1-2011 Annexure-D.

(2.) Petitioners who are plaintiffs in the Trial Court in O.S. Nos. 101 and 100 of 2002 respectively are before this Court seeking for quashing of the order dated 20-8-2009 Annexure-D whereunder application I.A. No. 3 filed by the plaintiffs under Section 33(1) of the Karnataka Stamp Act, 1957 praying to impound the agreement of sale dated 3-7-1997 and sending it to the Deputy Commissioner (Stamps), Bagalkot, for taking necessary action came to be allowed in part namely, it was ordered to be impounded and prayer to send the document to the Deputy Commissioner (Stamps) came to be rejected by order dated 20-8-2009 Annexure-D and pursuant to the said order, calculation has been made by the Registry of Trial Court and petitioners have been directed to pay stamp duty and penalty of Rs. 5,20,300/- and Rs. 6,57,800/- respectively by 21-8-2009, contending inter alia that when an application is voluntarily filed under Section 33(1) of the Karnataka Stamp Act, 1957 by the plaintiffs in both the suits to impound the agreement of sale dated 3-7-1997, for being referred to the Deputy Commissioner (Stamps), Bagalkot, for collecting deficit stamp duty and penalty, Trial Court could not have allowed the application in part, namely, it could not have impounded the document by itself and it could not have directed the registry to collect penalty and deficit stamp duty, without referring the said document to the Deputy Commissioner for collection of stamp duty and penalty and as such, order of the Trial Court is erroneous and is liable to be set aside.

(3.) Mr. V.P. Kulkarni, learned Counsel appearing for petitioner would contend that Civil Court has no jurisdiction to collect stamp duty and levy penalty and same has to be done by the Deputy Commissioner (Stamps) and the said discretion has to be exercised by him. He would also elaborate his submission by contending that maximum penalty contemplated under Section 39 of the Karnataka Stamp Act, 1957 need not be levied by the Deputy Commissioner and he contends that Trial Court after passing the order allowing I.A. No. 3 in part, ought not to have directed the registry to calculate the deficit stamp duty by levying penalty of 10 times the stamp duty and said calculation made by the Registry of the Trial Court is contrary to the statutory provisions, namely, Sections 34 and 39 of the Stamp Act, and the law laid down by this Court in the case of K. Govinde Gowda v. Smt. Akkayamma and Others, 2012 4 KarLJ 240 and as such, he seeks for setting aside the order passed by Trial Court and allowing application filed by the plaintiffs before the Trial Court in its entirety or in the alternate he seeks for a direction to the Trial Court to collect stamp duty and minimum penalty as held by this Court in K. Govinde Gowda's case. He would submit that Trial Court even otherwise has power under Section 34 to collect the duty and penalty by itself and not necessarily levying penalty at the rate of 10 times the duty as prescribed under Section 39 in view of the law laid down by this Court in K. Govinde Gowda's case holding that provision of Sections 34 and 39 of the Stamp Act being discriminatory in nature, it came to be so read down in the said judgment and hence, he prays for allowing the application I.A. No. 3 filed by the plaintiffs before the Trial Court to impound the document by Deputy Commissioner (Stamps) or to collect the stamp duty and impose penalty by the Trial Court itself as held in K. Govinde Gowda's case.