Case: Jupudi Kesava Rao Vs. Pulavarthi Venkata Subbarao And Others

2. The relevant facts are as follows. There is a rice mill in Bhimavaram, West Godavari District, which was formerly owned by the appellant along with respondents 3, 4 and 5. The mill was built on a site with an area of Ac. 1-75 by one K. N. Raju who had obtained a lease thereof from the guardian of respondents 1 and 2. It was executed on 21st December, 1941 and was to expire on 17th July, 1956. The appellant and respondents 3, 4 and 5 were successors-in-interest of the said lease-hold rights. Respondents 1 and 2 served notice of ejectment on the lessees to quit the site and deliver possession on the expiry of the said lease.3. According to the lessees there were negotiations for a new lease. Respondents 1 and 2 demanded enhanced rent and an agreement was ultimately arrived at on January 6, 1957 between the appellant and respondent No. 5 for themselves and on behalf of respondents 3 and 4 on the one hand and respondents 1 and 2 on the other for grant of a new lease for a period of thirty years commencing on January 1, 1957. The rent was fixed at Rs. 540/- per annum payable every two months. There was an option given to the lessors to purchase the rice mill at a price to be fixed by the President of the Rice Mills Association but in case the said option was not exercised, the lessees were entitled to remove the structures of the Mill. The lessees were to continue in possession and a deed of lease was to be executed and registered within a short time. The agreement was written on two stamp papers of Rs. 0-12-0 each and signed by the appellant and the 5th respondent on the one hand and respondent No. 1 on his own behalf and on behalf of respondent No. 2. The document was delivered to the respondent No. 1 after execution.4. The appellants further case is that thereafter he effected considerable improvements to the mill costing about Rs. 30,000/- and purchased the shares of respondents 3 and 4 in the said mill but respondent No. 5 who had originally joined the appellant in the suit for specific performance of the said agreement sold his share in or about September, l955 to respondent No. 6 herein.5. On March 12, l957 respondents 1 and 2 instituted a suit O. S. No. 31 of 1957 in the Court of the District Munsif of Bhimavaram against the appellant and respondents 3, 4 and 5 besides certain other persons who were in occupation of the site, for recovery of possession after removing the rice mill and structures standing thereon on the basis that on the expiry of the old lease they had become entitled to possession. Respondents 1 and 2 instituted another suit O. S. No. 100 of 1957 on 4th April 1957 in the same Court claiming damages from the appellant and respondent No. 5 for failure to deliver the site from 1st January, 1957 till date of delivery of possession. In paragraph 6 of the plaint in this suit they expressly stated that they would file a separate suit to recover the future mesne profits. The total claim in this suit was computed at Rs. 4,700 being the amount due for 94 days from 1st January 1957 to 4th April 1957 at the rate of Rs. 50 per day. On April 5, 1958 the appellant and respondent No. 5 instituted O. S. No. 92 of 1958 against respondents 1 to 4 praying for specific performance of the agreement to lease mentioned above with a direction that the respondents 1 and 2 should execute the lease deed. By their written statement filed in O. S. No. 92 of 1958 respondents 1 and 2 denied the execution of the agreement to lease while in the two suits for recovery of possession and damages for illegal occupation the appellant and respondent No. 5 pleaded the aforesaid agreement for lease in defence and submitted that they were entitled to remain in possession without any liability as to damages.6. The three suits were tried together. As respondents 1 and 2 did not produce the original agreement which according to the appellant had remained with them, oral evidence was called by the appellant to prove the execution of the said document. In his judgment the learned Munsifplaintiffs have no right to lead any oral evidence in respect of the suit agreement to lease dated 6-11-957. However, in order to appreciate the case put forward by the plaintiffs in the absence of the agreement to lease oral evidence has been recorded to determine whether the plaintiffs are entitled to specific performance as the full facts must be before thethe evidence the learned Munsif recorded his findingplaintiffs on whom the burden lies have not proved by evidence of P.Ws. 1 to 5 and 7 which is interested and developed that the agreement to lease dated 6-1-1957 is true and valid.S. No. 92 of 1958 was therefore dismissed. O. S. No. 81 of 1957 was decreed against the appellant and others and they were directed to deliver vacant and peaceful possession after removing the constructions and the mill thereon on or before 9th July 1960. Suit No. 100 of 1957 was decreed against the appellant and respondent No. 5 for Rs. 117-2-10.7. The Subordinate Judge, Narsapur who heard the appeals from the judgment and decrees of the learned Munsif set them aside. The suit for specific performance of the contract of agreement to lease was decreed and defendants I and 2 in that suit were directed to execute and register a lease deed from 1st January, 1957. He accepted the oral evidence tendered on behalf of the plaintiffs in that suit and recorded that the objection regarding the admissibility of the oral evidence was raised only at the time of the arguments on the ground that the agreement was written on a stamp paper of Rs. 1-8-0 when it should have been written on a paper with a stamp of Rs. 60/-. According to the learned Subordinate Judge the defendants had suppressed the agreement to lease whereby the plaintiffs were deprived of the opportunity of making good the deficiency of the stamp. The learned appellate Judge held further that the conditions mentioned in Section 27-A of the Specific Relief Act had been fulfilled. He also found that the parties were contemplating the execution of a deed of lease subsequent to the agreement and the mere fact that plaintiffs continued their possession after the expiry of the period of the previous lease did not take the case out of the purview of Section 27-A of the Specific Relief Act.8. The High Court in Second Appeal went elaborately into the question of the admissibility of the oral evidence regarding the agreement to lease and held that "although the objection was raised by defendants 1 and 2 in the trial Court at the time of the final arguments and not before the oral evidence was received in regard to the admissibility of oral evidence, even then since Section 36 is not attracted to such an objection, the oral evidence cannot be acted upon. It is inadmissible in evidence and it cannot be received for any purpose.The appellant before us challenges this finding of the High Court.

Court's reasoning:
13. The first limb of Section 35 clearly shuts out from evidence any instrument chargeable with duty unless it is duly stamped. The second limb of it which relates to acting upon the instrument will obviously shut out any secondary evidence of such instrument, for allowing such evidence to be let in when the original admittedly chargeable with duty was not stamped or insufficiently stamped, would be tantamount to the document being acted upon by the person having by law or authority to receive evidence. Proviso (a) is only applicable when the original instrument is actually before the Court of law and the deficiency in stamp with penalty is paid by the party seeking to rely upon the document. Clearly secondary evidence either by way of oral evidence of the contents of the unstamped document or the copy of it covered by Section 63 of the Indian Evidence Act would not fulfil the requirements of the proviso which enjoins upon the authority to receive nothing in evidence except the instrument itself. Section 35 is not concerned with any copy of an instrument and a party can only be allowed to rely on a document which is an instrument for the purpose of Section 35. Instrument is defined in Section 2 (14) as including every document by which any right or liability is, or purports to be created transferred, limited, extended, extinguished or recorded. There is no scope for inclusion of a copy of a document as an instrument for the purpose of the Stamp Act.14. If Section 35 only deals with original instruments and not copies Section 36 cannot be so interpreted as to allow secondary evidence of an instrument to have its benefit. The words "an instrument" in Section 36 must have the same meaning as that in Section 35. The legislature only relented from the strict provisions of Section 35 in cases where original instrument was admitted in evidence without objection at the initial stage of a suit or proceeding. In other words, although the objection is based on the insufficiency of the stamp affixed to the document, a party who has a right to object to the reception of it must do so when the document is first tendered. Once the time for raising objection to the admission of the documentary evidence is passed, no objection based on the same ground can be raised at a later stage. But this in no way extends the applicability of Sec. 36 to secondary evidence adduced or sought to be adduced in proof of the contents of a document which is unstamped or insufficiently stamped.15. The above is our view on the question of admissibility of secondary evidence of a document which is unstamped or insufficiently stamped, as if the matter were res integra, It may be noted however that the course of decisions in India in the Indian High Courts, barring one or two exceptions, have consistently taken the same view.With all respect to the learned Judges it appears to us that both the premises of the last sentence of the above quotation and the conclusion based on the same are incorrect. Neither under the decision of the Judicial Committee nor the express words of Section 34 of the Stamp Act of 1879 mentioned in that judgment (present Section 36) allow the leading of secondary evidence of the contents of an insufficiently stamped document.24. As we have expressed our view already Section 35 imposed a bar on the reception of any but the original instrument and forbade the reception of secondary evidence. Section 36 only lifted that bar in the case of an original unstamped or insufficiently stamped document to which no exception as to admissibility was taken at the first stage. It did not create any exemption in the case of secondary evidence which a copy would undoubtedly be.In the case before the Judicial Committee the copy was one other than the final draft of the original document which had been lost through no fault on the part of the person intending to prove it and yet it was held that the Stamp Act ruled out its admissibility indo not think this judgment helps the appellant. If a suit is based on a document which is admittedly unstamped the insufficiency of the stamp is cured by the payment of penalty. The learned Judge never meant to lay down, as is contended for by Mr. Sen, that the defect of insufficiency of stamp is cured by the admission of execution of the document. The learned Judge of the Madras High Court relied on an earlier decision of that Court in Alimane Sahiba v. Subbarayudu, AIR 1932 Mad 963 wherein a suit had been filed on a promissory note which bore a stamp paper but the same was not cancelled. The defendant admitted the execution of the promissory note sued on but pleaded discharge. Subsequently at the stage of the argument the defendant raised a legal objection to the maintainability of the suit on the ground that the stamp affixed to the promissory note had not been cancelled as required by Section 12 of the Stamp Act and contended that the promissory note should accordingly be treated as unstamped for anywas wholly unnecessary, as was pointed out by the learned judge himself, to consider the question of admissibility under Section 36 of the Act. His decision really rested on the conclusion that a fact which is admitted did not require proof.27. The case is not an authority for the proposition that secondary evidence of a document is to be treated on the same footing as an unstamped or insufficiently samped original document.We find ourselves unable to accept the submissions made on behalf of the appellant. The Indian Evidence Act which was enacted in 1872 consolidates, defines and amends the law of evidence. By various Chapters it deals with matters as to how facts are to be proved and which facts need not be proved. Section 59 of the Act lays down that all facts except the contents of documents may be proved by oral evidence. Documentary evidence is dealt with in Chapter V and Section 61 provides that thecontents of the document may be proved either by primary evidence or secondary evidence. Under Section 62 primary evidence means the document itself produced for inspection of the Court. Section 63 shows the different kinds of secondary evidence admissible with regard to documents. It includes several kinds of copies as specified in(1) to (3) of the section, counterparts of documents as against the parties who did not execute them in terms of Clause (4) and oral accounts of the contents of a document given by some person who has himself seen it in terms of Clause (5). Under Section 64 documents must be proved by primary evidence except in cases mentioned thereafter. Section 65 allows secondary evidence to be given of the existence, condition or contents of a document in circumstances specified in Clauses (a) to (g) thereof. Under Section 91 when the relevant portion of a contract or of a grant or of any other disposition of property has been reduced to the form of a document, no evidence shall be given in proof of the terms except the document itself or secondary evidence of its contents in cases in which secondary evidence is admissible under the provisions hereinbefore contained.11. As the first Court of appeal recorded the finding that it was the defendants who were responsible for suppression of the original agreement to lease, a finding which was accepted by the High Court, it must be held that no objection to the reception of secondary evidence by way of oral evidence can be raised under the provisions of the Indian Evidence Act.12. The Indian Evidence Act however does not purport to deal with the admissibility of documents in evidence which require to be stamped under the provisions of the Indian Stamp Act. The Stamp Act which is now in force is an Act of 1899 but it had ain a statute of 1879. Chapter IV of the Stamp Act deals with instruments not duly stamped.