IN THE HIGH COURT OF JUDICATURE OF ANDHRA PRADESH AT HYDERABAD THE HON’BLE SRI JUSTICE C.V.RAMULU C.R.P.Nos.5412 & 5242 of 2009 Date: 9th September, 2010 Between: Peta Venkata Krishna Reddy .. Petitioner in both CRPs And Papa Reddy Navaneethamma .. Respondents in both CRPs THE HON’BLE SRI JUSTICE C.V.RAMULU C.R.P.Nos.5412 & 5242 of 2009 COMMON ORDER: C.R.P.No.5412 of 2009 This Civil Revision Petition under Article 227 of the Constitution of India is directed against an order dated 2.3.2006 made in I.A.No.611 of 2005 in O.S.No.1315 of 2000 on the file of the learned Principal Junior Civil Judge, Nellore. Petitioner is second defendant and respondent is the plaintiff. It appears, respondent laid suit in O.S.No.1315 of 2000 for specific performance of agreement of sale dated 10.1.1996. According to the petitioner, the alleged agreement of sale is insufficiently stamped and is hit by Section 47-A of Indian Stamp Act. Since there is recital about delivery of possession to the respondent under agreement of sale, in spite of objection raised at the time of marking, it was marked subject to objection. Unless the admissibility of document is decided, oral evidence cannot be let in in relation to the contents of the document. Hence, he filed I.A.No.611 of 2005 seeking to decide the admissibility of agreement of sale dated 10.1.1996 which was formally marked as Ex.A1 before cross-examination of P.W.1 in the suit. The said application was resisted by the respondent denying all the allegations. The trial Court, after a detailed consideration of each and every aspect of the matter, vide impugned order dated 2.3.2006 declared that Ex.A1 Agreement of Sale dated 10.1.1996 is admissible in evidence. The order reads as under: “Contention of the petitioner is that Ex.A1 agreement of sale is not sufficiently stamped and it is hit by Section 47-A of Indian Stamp Act. It is an unregistered one. In spite of the objection raised by the petitioner’s counsel, document was marked as Ex.A1. It is inadmissible in evidence for want of stamp duty and registration. According to him, Ex.A1 shall be declared as inadmissible document. Respondent alleges that total consideration was not passed under the Ex.A1 agreement of sale and there is a recital in the agreement of sale that balance of amount shall be passed at the time of registration of sale deed. Document once marked cannot be demarked at any stage. Plea taken by the respondent that document once marked cannot be demarked at any stage is not sustainable. Court got ample power to reject any document at any stage of the suit, which it considers to be irrelevant or otherwise inadmissible under Order XIII Rule 3 C.P.C. by recording reasons for rejection. In the instant case, unregistered agreement of sale was marked as Ex.A.1. Petitioner contends that it is not duly stamped. But perusal of it shows that it is executed on 100 rupees stamp paper. As per Schedule I-A (6)(A)(iv) of Indian Stamp Act, agreement in respect of property which exceeds Rs.50,000/- shall be executed on a stamp paper worth of Rs.100/-. Accordingly, Ex.A1 was executed on Rs.100/- stamp paper. Admittedly, Ex.A.1 agreement of sale is an unregistered document. Agreement of sale of immovable property of the value of Rs.100/- and upwards executed after 1.4.1999 shall be registered compulsorily under Section 17(1) (g) of Indian Registration Act. Ex.A.1 document is dated 10.1.1996. It goes to show that it was executed prior to the amendment to Section 17 of Indian Registration Act. Hence, Ex.A.1 is admissible in evidence, even though it is not registered. Even if Ex.A.1 is executed after 1.4.1999 and though not registered it can be received as evidence at a contract in a suit for specific performance as per Section 49 of Indian Registration Act. At the outset, I am of the opinion that this Court has not committed any error in marking agreement of sale as Ex.A.1. Ex.A.1 agreement of sale is duly stamped and does not requires registration as it is dated 10.1.1996. In the result, Ex.A.1 agreement of sale dated 10.1.1996 is declared as admissible document”. The learned counsel for petitioner strenuously contended that the trial Court erred in holding that the agreement of sale is properly stamped without considering the provisions of Section 47-A of the Indian Stamp Act and it ought to have held that the said agreement of sale is liable to be impounded with stamp duty and penalty as that of a conveyance and only thereafter the agreement of sale would be admissible in evidence and not otherwise. Whereas the learned counsel appearing for respondent supported the impugned order passed by the trial Court and submitted that it was only an agreement and therefore, the stamp duty of Rs.100/- is proper and sufficient and no further stamp duty is required to be paid and thus, the order passed by the trial Court cannot be said to be either arbitrary or illegal or erroneous. I have given my earnest consideration to the respective submissions made by the learned counsel on either side and perused the impugned order and other material made available on record. The only contention of the petitioner-defendant is that since Ex.A1 dated 10.1.1996 is an agreement of sale and so long as the same is not sufficiently stamped, particularly when there is a recital that the respondent-plaintiff was put in possession of the property, the same cannot be taken as admissible in evidence. To support his contention, the learned counsel relied upon the judgments in VEMI REDDY KOTA REDDY v. VEMI REDDY PRABHAKAR[1], CHINTAM KANTAM v. DHULIPUDI VENKATESWARA RAO[2], RATNAMALA v. G.RUDRAMMA[3] and TIRUMALA HOUSING (P) LTD. v. G.P.R. HOUSING (P) LTD.[4]. In CHINTAM KANTAM v. DHULIPUDI VENKATESWARA RAO (supra), it was held as under: “While deciding the question relating to the payment of stamp duty and penalty on a particular document, the recitals of the document may have to be looked into and not the pleadings of the respective parties. The pleadings of the parties may be in deviation of the document in question. The levy of the stamp duty and penalty is always in relation to the document which is to be marked before the Court and such levy cannot depend upon the pleadings of the parties. At any rate, in view of the decision of the Apex Court referred in Veena Hasmukh Jain’s case (supra) and the decision of the Division Bench of this Court referred in B.Rathnamala’s case (supra), I am of the considered opinion that the learned Principal Senior Civil Judge, Kakinada had definitely committed an illegality in placing reliance on the decision of a learned Single Judge of t his Court referred in Penkey Suryakantham’s case (supra). Hence, I have no hesitation in holding that the impugned order suffers from legal infirmity and is liable to be set aside.” In RATNAMALA v. G.RUDRAMMA (supra), this Court held that possession or indicating delivery of possession even in past, it is liable for stamp duty as sale under Explanation-I. Per contra, the learned counsel appearing for respondent- plaintiff submitted that the question of sufficiently stamping the document does not arise. Since, Ex.A1 is only an agreement of sale, Rs.100/- stamp paper is sufficient. He submitted that this case falls within the ambit of Section 49(c) of Registration Act, 1908. The learned counsel relied on the judgment in VALLURU CHINA LAKSHMI V. MAJJI DHARMA RAO[5] and drawn attention of the Court to paragraphs 4 and 5,which reads as under: “4. In my considered opinion, the trial Court also in error in holding that the stamp affixed to Ex.A.1 is not properly cancelled though the respondent did not take such plea in the written statement. Merely because the respondent took a plea that Ex.A.1 is forged, it cannot be said that he took a plea that as the stamp on Ex.A.1 is not properly cancelled it is not admissible in evidence. At the time of marking of the suit promissory note also no objection was taken in respect of its admissibility into evidence, on the ground that the stamp thereon is not properly cancelled. It cannot be said that the respondent is not aware as to how the stamp on Ex.A.1 was cancelled, before he filed his written statement because as per Rule 20(4) of Civil Rules of Practice and Circular Orders, every plaint or proceeding presented to or filed in Court shall be accompanied by as many copies on plain paper of the plaint or proceeding and the document referred to in Rule 16, as there are defendants or respondents, unless the Court otherwise dispenses with such copies of the documents, by reason of their length or for any other sufficient reason. So, a copy of Ex.A.1 must presumed to have been served on the respondent. Even assuming that a copy of Ex.A.1 was not served on the respondent, as he, as per Rule 117 of the Civil Rules of Practice and Circular Orders, has a right to inspect the documents filed into Court before filing his written statement, respondent could have inspected the documents filed with the plaint and if he felt that the suit promissory note (Ex.A.1) is not properly cancelled, he should have taken a specific plea in the written statement that inasmuch as the stamp on the suit promissory note is not properly cancelled it is inadmissible in evidence. When respondent did not take any such plea in the written statement and did not object to its marking when it was being marked, he cannot, at the time of arguments, take the revision petitioner for surprise and contend that inasmuch as the stamp on Ex.A.1 is not properly cancelled it should be treated as an unstamped pronote and so the plaintiff should be non-suited. The trial Court was in error in accepting the contention of the respondent that the Ex.A.1 is not admissible in evidence as the stamp thereon is not properly cancelled. 5. All the above apart, the assumption of the trial Court that the stamp on Ex.A.1 is not properly cancelled is not a correct finding because the name of the respondent is. written across the stamp and the thumb impression of the respondent is affixed towards the end of his name on the word 'Nisani'. According to Section 12 of the Act cancellation of an adhesive stamp can be made by writing on or across the stamp his name or initials or the name or initials of his firm with the true date of his so writing, or in any other effectual manner. In fact in Sudersanam v. S. Venkata Rao MANU/AP/0186/1963 : AIR1963AP442 , it is held that drawing of two parallel lines on the stamps is due cancellation of stamps. When the name of the respondent is written across the revenue stamps and his thumb impression is taken towards the end of the name on the word 'Nisani' it is but a proper cancellation of the stamp as contemplated by Section 12 of the Act. So, the trial Court clearly erred in holding that the stamp on Ex.A.1 is not properly cancelled.” The learned counsel also relied on the judgment in SINIGINIEEDI HYMAVATHI v. V. NAGESWARA RAO and drawn the attention of the Court to paragraphs 13 to 15, which reads as under: “13. Yet another important contention had been advanced with all seriousness that though by mere inadvertence objection had not been taken relating to the admissibility of Ex.A1 before the learned Judge, the same can definitely be agitated before this Court both on the ground of inadmissibility and also on the ground of the same being liable for stamp duty and penalty. Both the Counsel made elaborate submissions in this regard. Section 36 of the Indian Stamp Act 1899 reads as hereunder: 36. Admission of instrument where not to be questioned:-- Where an instrument has been admitted in evidence, such admission shall not, except as provided in Section 61, be called in question at any stage of the same suit or proceeding on the ground that the instrument has not been duly stamped. 14. In T. Chandri and Ors. v. Kambrath Kanarakutty, MANU/KE/0022/1990 : AIR1990Ker122 , the learned Judge of Kerala High Court held that when the document was admitted in evidence with consent and no objection was raised by the defendant at that time, the subsequent plea by the defendant that since one of the stamps was not cancelled, the document was not admissible would not be tenable and once the document is admitted the case of the plaintiff stands proved and he is entitled to the decree as prayed for. Reliance was placed on the decision of Apex Court in Ram Rattan v. Bajarang Lal and Ors. MANU/SC/0318/1978 : [1978]3SCR963 , wherein the Apex Court at Para 6 observed as hereunder: When the document was tendered in evidence by the plaintiff while in witness box, objection having been raised by the defendants that the document was inadmissible in evidence as it was not duly stamped and for want of registration, it was obligatory upon the learned trial Judge to apply his mind to the objection raised and to decide the objection in accordance with law. Tendency sometimes is to postpone the decision to avoid interruption in the process of recording evidence and, therefore, a very convenient device is resorted to, of marking the document in evidence subject to objection. This, however, would not mean that the objection as to admissibility on the ground that the instrument is not duly stamped is judicially decided; it is merely postponed. In such a situation at a later stage before the suit is finally disposed of it would none-the less be obligatory upon the Court to decide the objection. If after applying mind to the rival contentions the trial Court admits a document in evidence, Section 36 of the Stamp Act would come into play and such admission cannot be called in question at any stage of the same suit or proceeding on the ground that the instrument has not been duly stamped. The Court, and of necessity it would be trial Court before which the objection is taken about admissibility of document on the ground that it is not duly stamped, has to judicially determine the matter as soon as the document is tendered in evidence and before it is marked as an exhibit in the case and where a document has been inadvertently admitted without the Court applying its mind as to the question of admissibility, the instrument could not be said to have been admitted in evidence with a view to attracting Section 36 (see Javer Chand v. Pukhraj Surana MANU/SC/0036/1961 : [1962]2SCR333 ). The endorsement made by the learned trial Judge that "objected, allowed subject to objection", clearly indicates that when the objection was raised it was not judicially determined and the document was merely tentatively marked and in such a situation Section 36 would not be attracted. 15. In Dokka Joganna v. Upadrasta Chayadevi 1997 (6) ALD 224: 1997 (5) ALT 628, while dealing with the scope and ambit of Section 36 of the Indian Stamp Act 1899 the learned Judge of this Court observed: Dealing with the scope and ambit of this section, it has been held in a catena of decisions that once a document is admitted in evidence rightly or wrongly, with or without objection, it is not permissible for the Court including appellate or revisional Court to reject the same on the ground that it has not been duly stamped. (See V.E.A. Annamalai Chettair and Anr. v. S.V.V.S. Veerappa Chettiar and Ors. MANU/SC/0084/1952 : AIR1956SC12 ; Nalluru Basavaiah Naudu v. Takella Venkateshwarlu 1956 An. WR 490 : 1956 ALT 22: AIR 1957 AP 1022; and P. Ramana Reddi v. K. Rukminamma 1968 (1) An. WR 221). In the light of the above settled proposition of law, the admissibility of the suit documents cannot be left open to be decided at a later stage, i.e., while rendering judgment taking into account other oral and documentary evidence that may be adduced by the parties to the suit. Thus, it has become imperative to decide their admissibility in evidence at this stage itself i.e., before they are marked and proved on behalf of the respondent/plaintiff. Be that as it may, on a close perusal of the entire record of the lower Court, the following facts have come to light: 1. The agreement of sale Ex.A1 was executed on 10.1.1996, whereunder there is a recital to the fact that the plaintiff was put in possession of the suit schedule property. 2. However, in the plaint filed, the plaintiff has not asserted anywhere that he was put in possession of the property under Agreement of Sale Ex.A1 and is in actual possession of the property. 3. The link documents of the property i.e. the documents executed in favour of the vendor of the plaintiff was filed into the Court. 4. The notices exchanged between the parties were also filed along with plaint. 5. Except Ex.A1, no other document shows that possession was delivered in favour of plaintiff under the agreement including plaint. The written statement is not available. 6. The plaintiff has also not asserted that he is in possession of the property in pursuance of the agreement. The suit is filed for specific performance of the agreement of sale – but not recovery of possession. The defendant has not denied possession of the plaintiff any where. The link documents were also delivered to the plaintiff. A plain reading of the document Ex.A1 further reveals that it is only an agreement of sale and not sale as contended, but it evidences delivery of possession. Therefore, paying Rs.100/- stamp duty is not sufficient. It cannot be treated as sale, but it has to satisfy the test of Explanation I of Article 47-A of Indian Stamp Act. Therefore, it has to be stamped like a sale. In this context, it is relevant to notice Explanation I of Article 47-A of Indian Stamp Act and the proviso thereto, which reads as follows: “An agreement to sell followed by or evidencing delivery of possession of the property agreed to be sold shall be chargeable as a ‘sale’ under this Article: Provided that, where subsequently a sale deed is executed in pursuance of an agreement of sale as aforesaid or in pursuance of an agreement referred to in Clause (b) of Article 6, the stamp duty, if any, already paid or recovered on the agreement of sale be adjusted towards the total duty leviable on the sale deed”. Under those circumstances, the “documents executed” shall have to be looked into strictly. The Document Ex.A1 shows that possession was delivered in favour of plaintiff on the date of execution of agreement itself. Both the plaintiff and defendants have tactfully concealed the fact as to possession of the suit schedule property. Neither the plaintiff asserted positively nor the defendant said either way. Ex.A1 does not require registration under Section 47A, since it is not an outright sale and it is only an agreement of sale. Further, the judgments relied upon by either-side are not directly related to the case on hand, therefore, they need not be delved in detail. Therefore, I am of the considered opinion, in the peculiar circumstances of this case, that the recitals in the document executed are ‘sinquanon’. The Ex.A1 agreement of sale dated 10.1.1996 cannot be admitted in evidence, since it is hit by Article 47-A Expl.I of the Indian Stamp Act for want of proper stamp duty – may be it does not required to be registered. Thus, the impugned order is set aside and the objections raised by the petitioner/defendant are sustainable and upheld. For the foregoing reasons, both the C.R.Ps. are accordingly allowed. No order as to costs. However, this will not preclude the respondent-plaintiff from getting Ex.A-1 document impounded, as per law. ______________ C.V.RAMULU, J Date: 9.9.2010 DA THE HON’BLE SRI JUSTICE C.V.RAMULU C.R.P.Nos.5412 & 5242 of 2009 9.9.2010 [1] 2003(3) L.S. 480 [2] 2004 (1) ALD 380 [3] AIR 2000 AP 167 [4] 2006(5) ALT 532 [5] 2007(5) ALD 199