Judgment Case ID: 366

Judgment:
Appeal No. 159 of 1954. Appeal by Special Leave from the Judgment and Order dated the 27th day of June 1952 of the Calcutta High Court in Matter No. 214 of 1951 A reference under section 57 of the Indian Stamp Act. M. C. Setalvad	 Attorney General of India (B. Sen and P. K. Bose	 with him) for the appellant. section Chaudhury	 (section N. Mukherjee	 B. N. Ghosh and A. K. Basu	 with him) for the respondent. October 4. VENKATARAMA AYYAR J. This appeal raises a question under section 5 of the Indian Stamp Act II of 1899. The respondent was	 at the material time	 the Managing Director of Messrs Bird and Co. Ltd.	 and of Messrs F. W. Heilgers and Co.	 Ltd.	 which were acting as Managing Agents of several Companies registered under the Indian Companies Act. He was also a Director of a number of other Companies	 and had on occasions acted as liquidator of some Com 107 844 panies	 as executor or administrator of estates of deceased persons and as trustees of various estates. On 4 7 1949 he applied to the Collector of Calcutta under section 31 of the Stamp Act for adjudication of duty payable on a power of attorney	 marked as Exhibit A in the proceedings	 which he proposed to execute. By that power	 he empowered Messrs Douglas Chisholm Fairbairn and John James Brims Sutherland jointly and severally to act for him in his individual capacity and also as executor	 administrator	 trustee	 managing agent	 liquidator and all other capacities. The Collector referred the matter under section 56(2) of the Act to the decision of the Chief Controlling Revenue Authority	 who eventually referred it under section 57 to the High Court of Calcutta stating his own opinion that the stamp duty was payable on the power "for as many respective capacities as the principal executes the power". The reference was heard by a Bench consisting of the Chief Justice	 Das	 J. and section R. Das Gupta	 J.	 who differed in their opinion. The learned Chief Justice with whom Das	 J. agreed	 held that the different capacities of the executant did not constitute distinct matters for purposes of section 5 of the Act	 and that the proper duty payable on the instrument was Rs. 10 under article 48(d) of Schedule 1 A of the Stamp Act as amended by section 13 of Bengal Act III of 1922. section R. Das Gupta	 J. was of the opinion that the different capacities of the executant were distinct matters for the purposes of section 5	 and that the instrument was chargeable with the aggregate amount of duty payable if separate instruments were executed in respect of each of those capacities. In the result	 the question was answered in accordance with the opinion of the majority in favour of the respondent. Against that decision	 the Board of Revenue	 West Bengal has preferred this appeal by special leave	 and contends that the instrument in question comprises distinct matters	 and must be stamped in accordance with section 5. The statutory provisions bearing on the question are sections 3 to 6 of the Act. Section 3 is the charg 845 ing section	 and it enacts that subject to certain exemptions	 every instrument mentioned in the Schedule to the Act shall be chargeable with the duty of the amount indicated therein as the proper duty therefor. Section 4 lays down that when in the case of any sale	 mortgage or settlement several instruments are employed for completing the transaction	 only one of them called the principal instrument is chargeable with the duty mentioned in Schedule 1	 and that the other instruments are chargeable each with a duty of one rupee. Section 5 enacts that any instrument comprising or relating to several distinct matters shall be chargeable with the aggregate amount of the duties with which separate instruments	 each comprising or relating to one of such matters	 would be chargeable under the Act. Section 6	 so far as is material	 runs as follows: "Subject to the provisions of the last preceding section	 an instrument so framed as to come within two or more of the descriptions in Schedule I	 shall	 where the duties chargeable thereunder are different	 be chargeable only with the highest of such duties". The point for decision in this appeal is as to the meaning to be given to the words "distinct matters" in section 5. The contention of the respondent which found favour with the majority of the learned Judges in the court below is that the word "matters" in section 5 is synonymous with the word "description" occurring in section 6	 and that they both refer to the several categories of instruments which are set out in the Schedule. The argument in support of this con tention is this: Section 5 lays down that the duty payable when the instrument comprises or relates to distinct matters is the aggregate of what would be payable on separate instruments relating to each of these matters. An instrument would be chargeable under section 3 only if it fell within one of the categories mentioned in the Schedule. Therefore	 what is contemplated by section 5 is a combination in one document of different categories of instruments such as sale and mortgage	 sale and lease or mortgage and lease and the like	 But when the category is one 846 and the same	 then section 5 has no application	 and as	 in the present case	 the instrument in question is a power of attorney	 it would fall under article 48 (a) in whatever capacity it was executed	 and there being only one category	 there are no distinct matters within section 5. We are unable to accept the contention that the word "matter" in section 5 was intended to convey the same meaning as the word "description" in section 6. In its popular sense	 the expression "distinct matters" would connote something different from distinct "categories". Two transactions might be of the same description	 but all the same	 they might be distinct. If A sells Black acre to X and mortgages White acre to Y	 the transactions fall under different categories	 and they are also distinct matters. But if A mortgages Black acre to X and mortgages Whiteacre to Y	 the two transactions fall under the same category	 but they would certainly be distinct matters. If the intention of the legislature was that the expression 'distinct matters ' in section 5 should be understood not in its popular sense but narrowly as meaning different categories in the Schedule	 nothing would have been easier than to say so. When two words of different import are used in a statute in two consecutive provisions	 it would be difficult to maintain that they are used in the same sense	 and the conclusion must follow that the expression "distinct mat ters" in section 5 and "descriptions" in section 6 have different connotations. It is urged against this conclusion that if the word "matters" in section 5 is construed as meaning anything other than "categories" or in the phraseology of section 6	 "descriptions" mentioned in the Schedule	 then there could be no conflict between the two sections	 and the clause in section 6 that it is "subject to the provision of the last preceding section" would be meaningless and useless. We see no force in this contention. Though the topics covered by sections 5 and 6 are different	 it is not difficult to conceive of instruments which might raise questions falling to be determined under both the sections. Thus	 if a part 847 nership carried on by members of a family is wound up and the deed of dissolution effects also a partition of the family properties as in Secretary	 Board of Revenue vs Alagappa Chettiar(1)	 the instrument can be viewed both as a deed of dissolution and a deed of partition	 and under section 6	 the duty payable will be the higher duty as on an instrument of partition. But supposing by that very deed one of the members creates a charge or mortgage over the properties allotted to his share in favour of another member for moneys borrowed by him for his own purposes	 that would be a distinct matter which would attract section 5. Now	 but for the saving clause	 a contention might be advanced that sections 5 and 6 are mutually exclusive	 and as the in strument falls within section 6	 the only duty payable thereon is as on an instrument of partition and no more. The purpose of the clause in section 6 is to repel any such contention. Considerable stress was laid by Mr. Chaudhury on the scheme of the Act as embodied in sections 3 to 6 as strongly supporting the view that 'matters ' in section 5 meant the same thing as 'description ' in section 6. He argued that under section 3 the duty was laid not on all instruments but on those which were of the descriptions mentioned in the Schedule	 that section 4 enacted a special provision with reference to three of the categories mentioned in the Schedule	 sale (conveyance)	 mortgage and settlement	 that if they were completed in more than one instrument	 not all of them were liable for the duty specified in the Schedule	 but only one of them called the principal document	 and that section 6 provided that when the instrument fell under two or more of the categories in the Schedule	 the duty payable was the highest payable on any one of them	 that thus the categories in the schedule were the pivot on which the entire scheme revolved	 and that in construing the section in the light of that scheme	 the expression "distinct matter" must in the setting be construed as distinct categories. To construe "distinct matters" as (1) I.L.R. 848 something different from "distinct categories" would be	 it was argued	 to introduce a concept foreign to the scheme of the enactment. The error in this argument lies in thinking that the object and scope of sections 4 to 6 are the same	 which in fact they are not. Section 4 deals with a single transaction completed in several instruments	 and section 6 with a single transaction which might be viewed as falling under more than one category	 whereas section 5 applies only when the instrument comprises more than one transaction	 and it is immaterial for this purpose whether those transactions are of the same category or of different categories. The topics dealt with in the three sections being thus different	 no useful purpose will be served by referring to section 4 or section 6 for determining the scope of section 5 or for construing its terms. It is not without significance that the legislature has used three different words in relation to the three sections	 'transaction ' in section 4	 matter ' in section 5	 and 'description ' in section 6. In support of his contention that 'distinct matters ' in section 5 meant only different categories	 learned counsel for the respondent relied on certain observations in Ansell vs Inland Revenue Commissioners(1). There	 the instrument under consideration was a deed of settlement which comprised certain Government securities as also other investments	 and under the Stamp Act	 1891	 it was chargeable with a single duty ad valorem on the value of all the properties settled. By section 74	 sub section (1) of the Finance Act	 1910	 voluntary dispositions were chargeable with a higher stamp duty as on a conveyance; but Government securities were	 exempted from the operation of the section. The question that arose for decision was whether a separate duty was payable in respect of Government stocks under the provisions of the Stamp Act	 1891 over and above what was paid under section 74	 sub section (1) of the Finance Act	 1910 on account of other investments. Answering it in the affirmative	 Rowlatt	 J. observed: (1) 	 849 "If two different classes of property are being transferred by the same words of assignment in the same document	 and those two different classes of property in the same document are different from the point of view of the Stamp Act and taxation	 it seems to me in common sense that they must be distinct matters". The respondent wants to read these observations as meaning that where the matters are not dealt with separately for purposes of stamp duty	 then they are not distinct matters. This	 however	 does not follow. The case before the court was one in which the instrument dealt with properties which fell under ' two categories	 and the decision was that they were distinct matters. There is nothing either in the deci sion or the observations quoted above to support the contention of the respondent that if the instrument comprises matters falling within the same description	 it is not to be construed as comprising distinct matters. Reliance was also placed on the observations in Reversionary Interest Society vs Commissioners of Inland Revenue(1)	 in which it was held that a statutory declaration for the purpose of carrying through a transaction was liable for a single stamp duty. There	 the declaration was made by husband and wife	 and in view of the purpose for which it had to be used	 it was construed as one declaration. This is a decision on the facts	 and is not of much assistance. In the view	 then	 that section 5 would apply even when the instrument comprises matters of the same description	 the point for decision is whether the instrument proposed to be executed by the respondent is a single power of attorney or a combination of several of them. The contention of Mr. Chaudhury is that when the executant of one instrument confers on the attorney a general authority to act for him in whatever matters he could act	 then there is	 in fact	 only a single delegation	 and that therefore the instrument must be construed as a single power of attorney liable for a single duty under article 48(d) (1) 850 of the Schedule. The contention of the appellant	 on the other hand	 is that though the instrument is executed by one person	 if he fills several capacities and the authority conferred is general	 there would be distinct delegations in respect of each of those capacities	 and that the instrument should bear the aggregate of stamp duty payable in respect of each of such capacities. The question is which of these two contentions is correct. We are unable to agree with the respondent 'that when a person executes a power of attorney in respect of all the matters in which he could act	 it should be held	 as a matter of law and without regard to the contents of the instrument	 to comprise a single matter. Whether it relates to a single matter or to distinct matters will	 in our opinion	 depend on a number of factors such as who are parties thereto	 which is the subject matter on which it operates and so forth. Thus	 if A executes one power authorising X to manage one estate and Y to manage another estate	 there would really be two distinct matters	 though there is only one instrument executed by one person. But if both X and Y are constituted attorneys to act jointly and severally in respect of both the estates	 then there is only one delegation and one matter	 and that is specifically provided for in article 48(d). Conversely	 if a number of persons join in executing one instrument	 and there is community of interest between them in the subject matter comprised therein	 it will be chargeable with a single duty. This was held in Davis vs Williams(1)	 Bowen vs Ashley(1)	 Good son vs Forbes(1) and other cases. But if the interests of the executants are separate	 the instrument must be construed as comprising distinct matters. Vide Freeman vs Commissioners of Inland Revenue(1). Applying the same principle to powers of attorney	 it was held in Allen vs Morrison(1) that when members of a mutual insurance club executed Single power	 it related to one matter 	 Lord Tenterdon	 C. J. observing that "there was certainly a community of (1) ; (2) ; 	 469. (3) ; 	 1000 1001. (4) [1870 71] L.R. 6 Exch. (5) ; 	 1153. purpose actuating all the members of this club". In Reference under Stamp Act	 section 46(1)	 a power of attorney executed by thirty six persons in relation to a fund in which they were jointly interested was held to comprise a single matter. A similar decision was given in Reference under Stamp Act	 section 46(2) where a power of attorney was executed by ten mirasdars empowering the collection of communal income appurtenant to their mirasi rights. On the other hand	 where several donors having separate interests execute a single power of attorney with reference to their respective properties as	 for example	 when A constitutes X as attorney for management of his estate Black acre and B constitutes the same person as attorney for the management of his estate White acre	 then the instrument must be held to comprise distinct matters. It was so decided in Reference under Stamp Act	 8. 46(3). Thus	 the question whether a power of attorney relates to distinct matters is one that will have to be decided on a consideration of the terms of the instrument and the nature and the extent of the authority conferred thereby. It may be mentioned that questions of this character cannot now arise in England in view of the special provision contained in the Finance Act	 1927 (17 & 18	 Geo. 5	 Ch. 10)	 section 56 which runs as follows: "No instrument chargeable with stamp duty under the heading Letter or Power of Attorney and Commission	 Factory	 Mandate	 or other instrument in the nature thereof ' in the First Schedule to the Stamp Act	 1891	 shall be charged with duty more than once by reason only that more persons than one are named in the instrument as donors or donees (whether jointly or severally or otherwise)	 of the powers thereby conferred or that those powers relate to more than one matter". There is no provision in the statute law of this country similar to the above	 and it is significant that it assumes that a power of attorney might consist of distinct matters by reason of the fact that there are (1) Mad. (2) Mad. (3) 108 852 several donors or donees mentioned in it	 or that it relates to more than one matter. Now	 considering Exhibit A in the light of the above discussion	 the point for determination is whether it can be said to comprise distinct matters by reason of the fact that the respondent has executed it in different capacities. In this form	 the question is bereft of authority	 and falls to be decided on well recognised principles applicable to the matter. It is	 as has been stated above	 settled law that when two persons join in executing a power of attorney	 whe ther it comprises distinct matters or not will depend on whether the interests of the executants in the subject matter of the power are separate or joint. Conversely	 if one person holding properties in two different capacities	 each unconnected with the other	 executes a power in respect of both of them	 the instrument should logically be held to comprise distinct matters. That will be in consonance with the generally accepted notion of what are distinct matters	 and that certainly was the view which the respondent himself took of the matter when he expressly recited in the power that he executed it both in his individual capacity and in his other capacities. But it is contended by Mr. Chaudhury that the fact that the respondent filled several capacities would not affect the character of the instrument as relating to a single matter	 as the delegation thereunder extended to whatever the respondent could do	 and that it would be immaterial that be held some properties in his individual capacity and some others as trustee or executor	 as the legal title to all of them would vest in him equally in the latter as well as in the former capacity. We are concerned	 he argued	 not with the source from which the title flowed but with the reservoir in which it is now contained. This is to attach more importance to the form of the matter than to its substance. When a person is appointed trustee	 the legal title to the estate does	 under the English law	 undoubtedly vest in him; but then he holds it for the benefit of the cestui que trust in whom the equitable estate vests. Under the 853 Indian law	 it is well established that there can be trusts and fiduciary relations in the nature of trust even without there being a vesting of the legal estate in the trustee as in the case of mutts and temples. Vide Vidya Varuthi vs Balusami(1). In such cases	 the legal title is vested in the institution	 the mahant or shebait being the manager thereof	 and any delegation of authority by him can only be on behalf of the institution which he represents. When a person possesses both a personal capacity and a representa tive capacity	 such as trustee	 and there is a delegation" of power by him in both those capacities	 the position in law is exactly the same as if different persons join in executing a power in respect of matters which are unrelated. There being no community of interest between the personal estate belonging to the executant and the trust estate vested in him	 they must be held to be distinct matters for purposes of section 5. The position is the same when a person is executor or administrator	 because in that capacity he represents the estate of the deceased	 whose persona is deemed to continue in him for purposes of administration. It was finally contended by Mr. Chaudhury that if every capacity of the donor is to be considered as a distinct matter	 we should have to hold that there are distinct matters not only with reference to the capacity of the executant as trustee	 executor and so forth	 but in respect of every transaction entered into by him in his personal capacity. Thus	 it is argued	 if he confers on his attorney authority to sell one property	 to mortgage another and to lease a third	 he would have acted in three different capacities as vendor	 mortgagor and lessor	 and the instrument will have to be stamped as relating to three distinct matters. This	 he contended	 would destroy the very basis of a general power of attorney. The fallacy in this argument is in mixing up the capacity which a person possesses with acts exercisable by virtue of that capacity. When an executor	 for example	 sells one property for discharging the debts of the testator and (1) [1921] 48 I.A. 302. 854 mortgages another for raising funds for carrying on his business	 he no doubt acts in two different transactions but in respect of both of them	 he functions only in his capacity as executor. In our opinion	 there is no substance in this contention. In the result	 we are of the opinion	 differing from the majority of the learned Judges of the court below	 that the instrument	 Exhibit A	 comprises distinct matters in respect of the several capacities of the respondent mentioned therein	 and that the view taken by the revenue authorities and supported by section R. Das Gupta	 J. is correct. This appeal will accordingly be allowed. The respondent will pay the costs of the appellant here and in the court below. BHAGWATI J. I regret I am unable to agree with the conclusion reached in the Judgment just delivered. While agreeing in the main with the construction put upon sections 4	 5 and 6 of the Act and the connotation of the words "distinct matters" used in section 5	 1 am of the view that the question still survives whether the instrument in question is a single power of attorney or a combination of several of them. The argument which has impressed my Bro ther Judges forming the majority of the Bench is that though the instrument is executed by one individual	 if he fills several capacities and the authority conferred is general	 there would be distinct delegations in respect of each of those capacities and the instrument should bear the aggregate of stamp duty payable in respect of each of such capacities. With the greatest respect I am unable to accede to that argument. I agree that the question whether a power of attorney relates to distinct matters is one that will have to be decided on the consideration of the terms of 'the instrument and the nature and the extent of the authority	 conferred thereby. The fact	 however	 that the donor of the power of attorney executes it in different capacities is not sufficient in my opinion to constitute the instrument one comprising distinct matters and thus requiring to be 855 stamped with the aggregate amount of the duties with which separate instruments each comprising or relating to one of such matters would be chargeable under the Act	 within the meaning of section 5. The transaction is a single transaction whereby the donor constitutes the donees jointly and severally his attorneys for him and in his name and on his behalf to act for him in his individual capacity and also in his capacity as managing director	 director	 managing agent	 agent	 secretary or liquidator of any company in which he is or may at any time	 thereafter be in terested in any such capacity as aforesaid and also as executor	 administrator	 trustee or in any capacity whatsoever as occasion shall require. No doubt	 different capacities enjoyed by the donor are combined herein but that does not constitute him different individuals thus bringing this instrument within the mischief of section 5. The executants of the instrument are not several individuals but is only one individual	 the donor himself	 though he enjoys different capacities. These different capacities have a bearing on the nature and extent of the powers which he could exercise as such. In his own individual capacity he could exercise all the powers as the full owner qua whatever right	 title and interest be enjoys in the property	 whether it be an absolute interest or a limited one. he may be the absolute owner of the property or may have a life interest therein	 he may have a mortgagee 's interest or a lessees interest therein	 he may be a dominant owner of a tenement or may be a mere licensee; but whatever interest be enjoys in that property will be the subject matter of the power which he executes in favour of the donee. He may	 apart from this individual interest which he enjoys therein	 be a trustee of certain property and be may also enjoy the several interests described above in his capacity as such trustee. It may be that	 in his turn he may be accountable to the beneficiaries for the due administration of the affairs of the trust but that does not mean that he	 as trustee	 is not entitled to exercise all these powers	 the trust property having vested in him	 and he being therefore in a position to exercise 856 all these powers in relation thereto. The same would be the position if he were an executor or an administrator of an estate	 in possession of the estate of the deceased as such. The property of the deceased would vest in him though his powers of dealing with the same would be circumscribed either by the provisions of the testamentary instrument or the limitations imposed upon the same by law. All these circumstances would certainly impose limitations on his powers of dealing with the properties but that does not detract from the position that he is entitled to deal with those properties and exercise all the powers in relation thereto though with the limitations imposed upon them by reason of the capacities which he enjoys. It follows	 therefore	 that	 though enjoying different capacities	 he is the same individual who functions though in different capacities and conducts his affairs in the various capacities which he enjoys but as a single individual. He is not one individual when be is acting in his own individual capacity; he is not another individual when he is acting as a trustee of a particular estate and he is not a third individual when he is acting as an executor or administrator of a deceased person. In whatever capacity he is acting he is the same individual dealing with various affairs with which he is concerned though with the limita tions imposed upon his powers of dealing with the properties by reason of the properties having vested in him in different capacities. I am therefore of the opinion that the instrument in question does not comprise distinct matters but comprises one matter only and that matter is the execution of a general power of attorney by the donor in favour of the donees constituting the donees his attorneys to act for him in all the capacities which he enjoys. The instrument in question cannot be split up into separate instruments each comprising or relating to a distinct matter in so far as the different capacities of the donor are concerned. A general power of attorney comprises all acts which can be done by the donor himself	 whatever be the capacity or capacities which he enjoys and cannot be split up 857 into individual acts which the donor is capable of per forming and which he appoints his attorney to do for him and in his name and on his behalf. It is within the very nature of the general power of attorney that all the distinct acts which the donor is capable of performing are comprised in the one instrument which is executed by him	 and if that is the position	 it is but logical that whatever acts the donor is capable of performing whether in his individual capacity or in his representative capacity as trustee or as executor or administrator are also comprised within the instrument and are not distinct matters to be dealt with as such so as to attract the operation of section 5. I am therefore of the opinion that the conclusion reached by the majority Judges in the High Court of Judicature at Calcutta was correct and would accordingly dismiss this Appeal with costs. BY THE COURT. In accordance with the opinion of the majority the Appeal is allowed with costs here and in the Court below.

Summary:
Held per section R. DAS	 ACTING C. J.	 VENKATARAMA AYYAR	 JAFER IMAM and CHANDRASEKHARA AIYAR JJ. (BHAGWATI J. dissenting) the contention that the word "matter" in section 5 of the Indian Stamp Act was intended to convey the same meaning as the word "description" in section 6 is without force. In its popular sense	 the expression "distinct matters" would connote something different from distinct "categories". Two transactions might be of the same description	 but all the same	 they might be distinct. When two words of different import are used in a statute in two consecutive provisions	 it cannot be maintained that they are used in the same sense and therefore the expression "distinct matters" in section 5 and "description" in section 6 have different connotations. It is settled law that when two persons join in executing a power of attorney	 whether it comprises distinct matters or not will depend on whether the interests of the executants in the subject matter of the power are separate or not. Conversely	 if one person holding properties in two different capacities	 each unconnected with the other	 executes a power in respect of both of them	 the instrument should logically be held to comprise distinct matters. Held	 that the instrument in question	 Exhibit A	 the power of attorney comprised distinct matters within the meaning of section 5 of the Indian Stamp Act in respect of several capacities of the respondent mentioned therein. Per BHAGWATI J. (dissenting). The fact that the donor of the power of attorney executes it in different capacities is not sufficient to constitute the instrument	 one comprising distinct matters and thus requiring to be stamped with the aggregate amount of the duties with which separate instruments each comprising or relating to one of such matters would be chargeable under the Act	 within the mean ing of section 5 of the Indian Stamp Act. The instrument in question	 Exhibit A	 does not comprise distinct matters but comprises one matter only and that matter is the execution of a general power of attorney by the donor in favour of 843 the donees constituting the donees his attorneys to act for him in all the capacities he enjoys. It is within the very nature of the general power of attorney that all the distinct acts which the donor is capable of performing are comprised in one instrument which is executed by him and therefore whatever acts the donor is capable of performing whether in his individual capacity or in his representative capacity as trustee or as executor or administrator are also comprised within the instrument and are not distinct matters to be dealt with as such so as to attract the operation of section 5 of the Indian Stamp Act. Secretary	 Board of Revenue	 Madras vs Alagappa Chettiar I.L.R. 	 Ansell vs Inland Revenue Commissioners 	 Reversionary Interest Society vs Commissioners of Inland Revenue [1906] 22 T.L.R. 740	 Davis vs Williams ; 	 Bowen vs Ashley ; 	 Good son vs Forbes ; 	 Freeman vs Commissioners of Inland Revenue [1870 71] L.R. 6 Exch. 101	 Allen vs Morrison ; 	 Reference under Stamp Act	 section 46	 Mad. 358	 Reference under Stamp Act	 section 46	 Mad. 386	 Reference under Stamp Act	 section 46	 	 and Vidya Varuthi vs Balusami	 48 I.A. 302	 referred to.