SRINIVASAN Vs. SUB REGISTRAR HIRIUR

JUDGEMENT

(1.) This is a reference under Section 54 of the Karnataka Stamp Act, 1957, (Act No. 34 of 1957), made by the Chief Controlling Revenue Authority to this Court stating the case referred and seeking for the opinion thereon of this Court.

(2.) The Managing Director of M/s. Bangalore Trading & Financing Corporation (Private) Limited, Bangalore, presented a lease deed dated 12.2.1981 executed by him on the same day in favour of M/s. Vanivilas Co-operative Sugar Factory Limited, Hiriyur, Chitradurga District, before the Sub Registrar, Hiriyur, for registration. The Sub Registrar impounded the document and in exercise of powers vested with him under Section 33 of the Karnataka Stamp Act, 1957, (hereinafter referred to as 'the Act'), issued notice to the presentant directing him to pay stamp duty of Rs. 11,200/- and, oh hearing, levied stamp duty and penalty of Rs. 5/- under the provisions of Section 39 of the Act, by his order dated 6.3.1981. Aggrieved by the said order of the SubRegistrar and Deputy Commissioner of Stamps, Hiriyur, the party preferred an appeal to the Chief Controlling Revenue Authority on 10.7.1981. The Chief Controlling Revenue Authority took the case on file and issued notice to the presentant on 24.7.1981 fixing the date of hearing on 27.7.1981. On the said date, the Advocate for the petitioner appeared and argued the case submitting that he was liable to pay stamp duty of Rs. 56,000/- only under Article 30(a)(iii) read with Article 20 of the Schedule to the Act and that the Sub-Registrar wrongly interpreted the document for the purpose of stamp duty. As the Authority felt that the issue involved a substantial question of law, he has made the present reference to this Court under Section 54(1) of the Act.

(3.) In the opinion of the Chief Controlling Revenue Authority, the recitals in the lease deed show that the lease is for a period of ten years reserving annual rent of Rs. 8,00,000/- and providing for the payment of Rs. 8,00,000/- towards rent in advance. The question is whether the advance payment of Rs. 8,00,000/- is to be construed as advance for the purpose of stamp duty in addition to the rent reserved attracting stamp duty under Article 30(c) of the Schedule to the Act as a lease for money advanced. The Chief Controlling Revenue Authority has opined that in view of the words 'or for money advanced' in Article 30(c) of the Schedule to the Act, the payment of rent in advance has to be construed as money advanced and the lease deed is chargeable accordingly. As, however, he was not free from doubt, he has referred the following questions for the opinion of this Court:-