BALAJI CHIT FUND JANGAON Vs. BALAJI SATYANARAYANA

JUDGEMENT

(1.) The plaintiff in O.S. No. 10 of 1964 filed a suit for recovery of an amount of Rs. 500 on the foot of a document dated 25th February, 1964. The plaintiff was Balaji Chit Fund, Jangaon and apparently the defendant was a subscriber. The document in question recited that the defendant received a sum of Rs. 6,000 promising to pay the same in fortnightly instalments of Rs. 250. The present suit is for the recovery of two instalments payable by the defendant. Originally the lower Court treated this as an agreement of loan under Article 6 (2) (5) of the Indian Stamp Act and recovered an amount of Rs. 10-12 P. and a penalty of Rs. 101-25 P. in all Rs. 111-37 P. on 24th April, 1964. Then the Assistant Court-fee Examiner, who appears to have been sent by the High Court thought that the document in question is a bond within the meaning of section 2 (5) of the Indian Stamp Act, 1899 (hereinafter called the Act) and that it should bear a stamp duty of Rs. 90 and that therefore stamp duty of Rs. 90 plus penalty of Rs. 900 being ten times the stamp duty payable, should be recovered from the plaintiff before the document could be received in evidence. According to the report of the Examiner, therefore, the plaintiff has still to pay Rs. 878.63 before the document could be admitted in evidence. This is clear from a copy of the Check Slip No. 465 which was served on the plaintiff's Vakil, Sri B. Sri Hari who filed his written objections to the same. The Munsif-Magistrate, Jangaon, purporting to follow a Full Bench decision of the Hyderabad High Court in Jai Narayan v. Yasin Khan, A.I.R. 1955 Hyd. 17 held that the question as to the nature of an impounded document and the amount of stamp duty and penalty recoverable there on is within the Collector's discretion and the decision of the Court is not a bar for the exercise of the discretion vested in the Collector under the provisions of section 38 of the Act. Therefore the lower Court felt that the question as to the nature of the document in the instant case and the stamp dutv and penaltv payable thereon are matters within the discretion of the Collector. Therefore it directed that the suit document in original be sent under section 38 (2) of the Act to the Collector, Warangal for adjudication by him in accordance with the provisions of the Act. The plaintiff filed this Civil Revision Petition questioning the legality of the order and the jurisdiction of the lower Court to send the document to the Collector for determining the nature of the document and the stamp duty and penalty payable thereon. It is contended by Mr. Dasaratharamaiah, the learned Counsel for the petitioner, that the lower Court had already decided that the document is an agreement of loan and collected the stamp duty and penalty thereon under section 38 (I) of the Act, which is as follows :-

(2.) Section 38 (I) refers to a case where the stamp duty and penalty as provided by section 35 have been collected by the Court or authority who receives and admits the document in evidence. That sub-section requires that the authority shall send to the Collector an authenticated copy of such instrument together with a certificate in writing stating the amount of duty and penalty levied in respect thereof and send such amount to the Collector or to such person as the Collector may appoint in that behalf. Sub-section (2) of section 38 refers to every other case, i.e., every case where the document is impounded, but the stamp duty and penalty are not collected and that sub-section requires that such a document so impounded shall be sent in original to the Collector. Sub-section (I) of section 39 says that when a copy of an instrument is sent to the Collector under section 38, sub-section (I), he may, if he thinks fit, refund any portion of the penalty in excess of five rupees which has been paid in respect of such instrument. So that section 39 (I) does not give power to the Collector to again decide the nature of the document and the amount of stamp duty and penalty payable thereon and levy the stamp duty and penalty as per his own decision, apparently because the Court has already decided that very question and collected the stamp duty and the penalty under section 38 (I). Sub-section (I) of section 39 merely empowers the Collector, if he thinks fit, to refund any portion of the penalty in excess of Rs. 5 which has been paid under section 38 (I). Section 40 of the Act refers to cases where the Collector impounds an instrument under section 33 or receives any instrument sent to him under section 38 (2) not being an instrument chargeable with a duty not exceeding ten naye paise only or a bill of exchange or promissory note. Under that section

(3.) In my view the decision in Jai Narayan v. Yasin Khan, does not apply to the facts of this case. That was a case under the Hyderabad Stamp Act which arose under reference made under section 55 of that Act. Earlier a Bench of the same High Court by its order dated 22-6-1349 Fasli impounded the document as an award and forwarded the same to the Inspector-General of Registration and Stamps for collecting the full stamp duty and ten times penalty of Rs. 6,435. The Inspector-General of Registration and Stamps before whom the case went at some stage stated that the action of the High Court In fixing the amount is neither a violation nor is it an order to the Collector for compliance, but that, on the other hand, it was helpful to the Officer to collect the amount and that according to section 38 of the Act the Collector has got full authority to assess the duty and ten times penalty and that if he differs from the opinion of the High Court, he can give the reasons in his judgment. No doubt the Full Bench of the Hyderabad High Court observed: