THE CHIEF CONTROLLING REVENUE AUTHORITY, BOARD OF REVENUE Vs. MRS. MANGALAM ISWARAN L.R. OF THE DECEASED B.P. ESWARAN
HIGH COURT OF MADRAS
The Chief Controlling Revenue Authority, Board Of Revenue
Mrs. Mangalam Iswaran L.R. Of The Deceased B.P. Eswaran
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K. Veeraswamy, J. -
(1.) This is a reference under Sec. 57 of the Indian Stamp Act. The question is:
Whether on the facts and circumstances of this case the sale deed dated 7th April executed by Thirumathi Pattammal and Pushpavathi Ammal in favour of the Respondent herein is absolutely void in law from the beginning and the refund of the value of stamps affixed on the instrument in question can be allowed?
The facts stated by the Chief Controlling Revenue Authority are that after the conveyance, it was found that the vendor had no title to the property covered by the document and, for that reason, the vendor executed another document conveying a different property. The first sale deed was valued as a conveyance. The point is whether because the vendor had no title, it could be regarded as one found to be absolutely void in law from the beginning within the meaning of Sec. 49(d) of the Stamp Act.
(2.) The sale deed contained, besides the operative part of the conveyance, covenants as to title and indemnity. It provides that if right in respect of the property conveyed, is found vested in a third party, the vendor would, at his own expense, make good the consequent loss to the vendee. Sec. 3 is the charging Sec. and it says that the instruments specified therein shall be chargeable with duty of the amount indicated in the schedule to the Act. The schedule gives the description of each instrument and the relative amount of duty payable in respect thereof. An instrument is defined by Sec. 2(14) to include every document by which any right or liability is proposed to be created, transferred, limited, extended, extinguished, or recorded. Where the instrument is a conveyance, it is charged accordingly, but where it is a composite document, as for instance containing a conveyance by way of sale, mortgage, charge, or exchange or release, the instrument will be liable to duty on each one of those transactions. In other words, by the definition of instrument it may be a document which creates rights or liabilities and it is with reference to such rights and liabilities created by the document that the chargeability to duty will have to be decided, as to whether duty is payable as a conveyance and also as on any other basis. Sec. 49 contemplates allowance for spoiled stamps and Clause (d) provides for allowance if an instrument executed by a party has been afterwards found to be absolutely void in law from the beginning. Instrument has been defined in the Act in the sense of a document which creates rights and liabilities with reference to which charge to stamp duty is determined.
(3.) Where an instrument is a document which is a conveyance simpliciter without anything more and the title to the property conveyed is found to be wanting, it will, in our opinion, fall clearly within the meaning of Sec. 49(d). In that case as held by the Privy Council in Harnath Kunwar v/s. Indar Bahadur Singh, I.L.R.(1922) All. 179 (P.C.), the agreement would be manifestly void from its inception because its subject matter was incapable of being bound in the manner stipulated. In that case the Courts in India had held the transfer as inoperative, as the vendor at the date of the execution of the document had no interest capable of transfer but merely an expectancy. The suit by the purchaser was for possession of the villages covered by the conveyance with an alternative prayer for payment of money. The Privy Council held that the Plaintiff was entitled to recover under Sec. 65 of the Contract Act.;
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