GAJANAN RAMACHANDRA VELANGI Vs. VIJAYA IRAPPA AND ORS.

JUDGEMENT

(1.) In CMP.8/2006, by order dated 2.8.2006, Sri.B.S.Ramakantha, District Judge (Retd), was appointed as the sole arbitrator, to adjudicate the dispute between the petitioner and the respondents, in respect of the matters pertaining to 'an agreement of sale' dated 14.4.2012. Learned Arbitrator having entered the reference, the parties filed their respective pleadings. Points for determination having been moulded, affidavit evidence of the petitioner was filed. During the course of further evidence of the petitioner, on 21.04.2008, before the learned Arbitrator, the original agreement of sale was produced. Respondents 1 to 6 having filed an application, under Sections 33 and 34 of the Karnataka Stamp Act, 1957 ('Act' for short), and sought impounding of the original agreement of sale, statement of objections was filed by the petitioner. The learned Arbitrator, upon perusal of the record and consideration of rival contentions, having found that 'the possession of the property in dispute is agreed to be delivered without executing conveyance' and that the instrument falls within the purview and ambit of Article 5(e)(i) of the Act and thus, attracts duty and penalty, under Section 34 of the Act and having regard to Section 33 of the Act, which speaks of examination and impounding of instruments and since the document produced came in performance of the functions of the Arbitral Tribunal, which has by consent of parties, authority to receive evidence and finding that the document in question has not been admitted in evidence and the same was only produced, by being of the opinion that Sub-Section (1) of Section 37 does not apply and it is only Sub-Section (2) of Section 37, which applies to the situation, allowed the application on the ground that the instrument is insufficiently stamped and impounded the same. Consequently, the original instrument was ordered to be sent to the jurisdictional authority, under Sub- Section (2) of Section 37 of the Act i.e. to the District Registrar, Belgaum, for needful in the matter, as contemplated under the Act and return the same, as provided under Sub-section (3) of Section 39 of the Act. The District Registrar having notified and the petitioner having consented to pay deficit stamp duty of Rs.8,54,800/- and pleaded to show leniency in the matter of levy of penalty, an order dated 16.7.2010 was passed and the petitioner was directed to pay the deficit stamp duty of Rs.8,55,000/- and penalty of Rs.5000/-, i.e., in all Rs.8,60,000/-. Assailing the said order, WP.67812/10 was filed. On 30.07.2012, Memo for withdrawal of the writ petition having been filed by stating that the writ petition was filed seeking a limited prayer and in view of filing of this writ petition challenging the constitutional validity of certain provisions of the Act, permission be granted to withdraw the writ petition and pursue this writ petition, permission was granted on 30.07.2012 and the said petition was dismissed as withdrawn. This writ petition was filed challenging the order dated 19.5.2010 passed by the Arbitrator and the order dated 16.7.2010 passed by respondent-10 District Registrar, Belgaum, and also the Constitutional validity of Section 34 and Article 5(e)(i) and (ii) of the Act.

(2.) Sri.F.V. Patil, learned advocate submitted that in view of upholding of constitutional validity of Article 5(e) and proviso (a) to Section 34 of the Act, in the case of Satish vs. State of Karnataka, 2011 ILR(Kar) 2484 , prayers relating to striking down of the said provisions, does not survive for consideration. However, he contended that the Arbitrator having no power to impound the instrument and the orders passed by the learned Arbitrator and the District Registrar, vide annexures-E and F, being contrary to the record of the case and the law are liable to be quashed.

(3.) Sri.M.G.Naganuri, learned advocate and Smt.K. Vidyavthi, learned AGA, on the other hand, made submissions in support of the orders, as at annexures-E and F, and sought dismissal of the petition with exemplary costs.