S.C.Manchanda, J. - (1.) This is a revision against the order of the Civil Judge, Varanasi, dated the 3rd December, 1962, upholding the objection of the Inspector of Stamps that paper 51/A dated the 20th of December 1960, whereby Shiv Kedar Singh released the right which he had acquired under the deed dated the 27th November 1959 (Ex. A1), was a conveyance within the meaning of Section 2(1) of the Stamp Act and was liable to Stamp Duty under Article 23 of Schedule I-B of the Stamp Act, hereinafter referred to as the Act.
(2.) In order to appreciate the contentions raised it is necessary to set out the relevant facts in brief: The plaintiff Shiv Kedar Singh had filed a suit for recovery of money against the firm Mukund Lal Durga Prasad and others. The plaintiff filed the document Ex. 51/A and the defendant filed paper 52-A. The Stamp Inspector reported that the stamp on these documents was insufficient and therefore they should be impound and ten times penalty imposed. The Civil Judge accepted the report of the Inspector impounding Ex. 51/A which was the document filed by the plaintiff-applicant and called upon the plaintiff to deposit the duty of Rs. 478/- and the penalty of Rs. 4780/-. In default the document was to be sent to the Collector for realisation of that deficiency in stamp duty and penalty according to law.
(3.) The document Ex. 51-A has a history behind it. On 15th May, 1959 one Sri Prakash entered into an agreement with Maharaj Kumar Vijay Nagram to take his cinema on lease for five years on a rent of Rs. 1,000/- per mensem and upon payment of a premium of Rs. 3,000/-. On 21.8.1959 the said Sri Prakash entered into a partnership agreement, dated 27th November 1959 with Mukund Lal and Abdul Haq with a view to run the said cinema. This partnership of three persons did not however have sufficient funds for this purpose and, therefore, invited one Shiv Kedar Singh, the plaintiff applicant to invest money in the Cinema business. As security for the advance to be made by Shiv Kedar Singh he was given the right to control and manage the Cinema business. This document is Ex. A-1. It recites that the first party is Shiv Kedar Singh, and the second party is the aforesaid partnership of three persons; that the second party are in need of a financier; that they had no funds and therefore they were obliged to request the plaintiff to come in as a financier and expend all further sums in running the said Cinema and that he was to realise his investment from the income from the Cinema. The terms, inter alia, were: (1) that when the plaintiff had realised whatever he had invested together with 12% interest thereon he would return the Cinema to the second party; (2) that the plaintiff will run the Cinema under his direct control so that the income therefrom may be appropriated by him towards his debt; (3) that when his debts are paid up out of the income he will cease to conduct this Cinema business and will have no concern with it thereafter; (4) that the parties agree that one Badri Prasad will be the Manager who will be employed by the plaintiff; (5) that after the Cinema is released the second party will run the Cinema in accordance with their partnership agreement dated the 21st August 1959, between Sri Prakash, Mukund Lal and Abdul Haq; (6) Responsibility for the proper management of the Cinema will be that of the plaintiff and the income will be appropriated by him towards the outstanding debt, if there is loss then the plaintiff will have to bear the loss as the management and control vests in him exclusively; (7) he will be entitled to interest at 1% per mensem, but he will not be entitled to any share of profit; (8) as and when his investment gets paid up interest will also get proportionately reduced; (9) the parties further agree that Badri Prasad Manager will get Rs. 150/- per mensem as his remuneration; (10) that Abdul Haq who is an operator will continue to work as such and get a remuneration of Rs. 125/- per mensem. Similarly, Sri Prakash and Mukund Lal will also render services on payment of Rs. 125/- each as remuneration. It was further specifically provided that the aforesaid three partner of the second party will have no control and management which will be exclusively in the hands of the first party; lastly, it was provided it will be open to the second party to pay off the amount advanced by the first party and put an end to his control and management of the Cinema at any time.;