STATE BANK OF HYDERABAD Vs. KOTHA PAPI REDDY

JUDGEMENT

(1.) In these five revision petitions a common question relating to the proper stamp duty that is payable on a set of documents has to be considered.

(2.) The circumstances and the material recitals of the documents in all the five matters are the same. To take for instance the facts in O. S. S. R. No. 1281 of 1972, out of which C. R. P No. 165/73 arises, is a suit filed by the State Bank of Hyderabad to recover a sum of Rs. 4,408.52 Ps. from two defendants. On 8-12-1969 the first defendant borrowed a sum of Rs. 3,910.50, from the Bank for purchasing a pump set and executed an agreement hypothecating the pump set and its accessories. On the same day, the second defendant executed another agreement in favour of the Bank guaranteeing due payment of the loan. The Bank filed the suit alleging that the defendants had failed to repay the amount. The deed of Hypothecation passed by the first defendant was engrossed on stamp paper of the value of Rs. 20-30 ps. There is no difficulty in regard to the sufficiency of the stamp on that deed. It was accepted as sufficient by the court below. The difficulty arose only in regard to the agreement of guarantee executed by the second defendant which bears a stamp of Rs. 2.30 ps. The office of the trial Court raised an objection saying that the agreement of guarantee falls under Article 48 of Schedule 1-A of the Indian Stamp Act and so it should have been engrossed on stamp paper worth Rs. 22.50 ps. A deficit stamp of Rupees 20-20 ps. and a penalty of Rs. 202.00 were demanded from the plaintiff Bank:

(3.) Learned Counsel for the plaintiff took the stand that the agreement of guarantee comes under Article 6 (2) of the Schedule 1-A and so the stamp it bears is sufficient. Consequently the matter was placed before the Court. The Court below upheld the objection raised by the office, holding that the agreement of guarantee is chargeable under Article 48. In the result, it directed the plaint to be returned for payment of deficit stamp duty and penalty as demanded by the office. The plaintiff, which is common to all the five proposed suits, has filed these revision petitions.