PADMA NAIR Vs. DEPUTY COLLECTOR

JUDGEMENT

(1.) THE writ petitioner along with one Chandrakant Gangaram Hatkar and one P. K. Vasudevan Nair jointly agreed to purchase a plot of land admeasuring 550 sq. meters situated at village Kirol, Taluka Kurla, Bombay, for a consideration of Rs. 25,000/ -. The said agreement for sale was executed on 16th October, 1984 and it was lodged for registration on the same day under Sr. No. S-4483/84. The agreement was executed on a stamp paper of Rs. 5/- as at the relevant time the stamp duty under the Bombay Stamp Act, 1958 on an agreement of this type was Rs. 5/- only. There is no dispute in that regard. Subsequently, the petitioner was served with an order dated 24-9-1986 issued by the Deputy Collector Valuation and Stamp Duty, Bombay, asking the petitioner to pay the stamp duty applicable to conveyance of immovable property along with penalty. The contention of the Deputy Collector was that the document dated 16-10-1984 lodged for registration by the petitioner was wrongly described as an agreement of sale whereas in effect it was a document of sale. In that view of the matter, according to the Deputy Collector the proper duty payable on such document was the duty applicable to "conveyance of immovable property". The value of the immovable property for that purpose was estimated at Rs. 1,77,000/- and the duty payable thereon after deducting a sum of Rs. 5/- already paid by way of stamp on the agreement of sale was determined at Rs. 22,545/ -. Since the documet was insufficiently stamped for registration, in addition to the above amount of stamp duty penalty in the sum of Rs. 45,090/- was also levied and demand in all aggregating to Rs. 67,635/- was raised on the petitioner. On 24th March, 1988 a notice was issued to the petitioner to show cause why the above amount should not be recovered. Aggrieved by the aforesaid order and the notice for recovery, the petitioner has approached this Court by filing the present writ petition.

(2.) THE question that arises for consideration is whether the document in question is an agreement for sale of immoveable property or it is a conveyance of immoveable property. For that purpose, it will be necessary to examine some of the recitals in the said agreement. I have gone through the agreement which is annexed to this petition as Exhibit-A. On a careful consideration of the same, it is clear that it is not only termed as an agreement for sale but, in fact, it is so. Clause 11 of it clearly provides :

(3.) IN the instant case, from a perusal of the document in question, it is clear that it does not itself create any interest in or charge on the property which is the subject matter of the agreement. It also does not itself purport to create any right in the land in favour of the purchasers. It merely confers a right on the purchasers to obtain another document. That being so, it is clear that the agreement in question is a pure and simple agreement for sale which confers a right on the purchaser to obtain another document of sale of the land which is the subject matter of the agreement. Such a document cannot be termed as deed of sale on the ground that possession has already been given by the vendor to the purchaser and the consideration has also been received. Sale of immoveable property is not completed by mere delivery of possession and receipt of consideration. Such agreements, therefore, cannot be treated as a conveyance having the effect of transfer of title in the immoveable property.