Bhupender Singh Bhalla vs Neelu Bhalla @ Neelam Singh
2013 Latest Caselaw 4953 Del

*       THE HIGH COURT OF DELHI AT NEW DELHI

+                       I.A.21072/2012, I.A. 5885/2013 & I.A. 1992/2013
                        in CS(OS) 2828/2012


                                                      Date of Decision: 29.10.2013

BHUPENDER SINGH BHALLA                                          ......PLAINTIFF

                                Through:            Mr. Achal Gupta, Adv.


                                         Versus

NEELU BHALLA @ NEELAM SINGH                                 ......DEFENDANT

                                Through:            Mr. N.N. Aggarwal, Mr. Rohit
                                                    Gandhi, Mr. Varun Garg and
                                                    Mr. Manpreet Kaur, Advs.

CORAM:
HON'BLE MR. JUSTICE M.L. MEHTA

M.L. MEHTA, J.

1. The above listed three applications are being disposed by this order. The plaintiff filed I.A. 5885/2013 Under Order 12 Rule 6 CPC praying for a decree against the defendant in terms of prayers (a), (b) and (e) of the plaint. The defendant filed an application under Order 7 Rule 11 CPC seeking rejection of plaint under clauses (b) and (c) of Order 7 Rule 11 CPC stating that the suit is grossly undervalued and the requisite court fees has not been paid as per Court Fees (Delhi Amendment) Act, 2012. Another application being I.A. 1992/2012 is

filed by the defendant under Sections 33, 35 and 38 of Indian Stamp Act read with Section 49 of Registration Act, 1908 stating that lease agreement which is relied upon by the plaintiff is unregistered and not properly stamped and thus could not be read in evidence and was liable to be impounded.

2. The respective applications are contested by the parties.

I.A. 5885/2013 (application on behalf of plaintiff under Order 12 Rule 6 r/w Section 151 CPC)

3. So far as the application under Order 12 Rule 6 of the plaintiff is concerned, the defendant states, and rightly so, that there is no unambiguous and categoric admission made by her in the written statement. It is stated that the defendant has set up her case of counter claim of specific performance on the premise that the defendant had agreed to purchase the suit premises from the plaintiff. In addition to this plea that is sought to be set up by the defendant, the defendant has also denied the relationship of licenser and licensee. It is her case that initially a license deed dated 14th December 1998 was executed, but the defendant was given the right to raise construction over and above the premises for the purpose of residence and running a restaurant, and this was renewed from time to time vide unregistered unstamped deeds, which as per law do not create relationship of lessor and lessee in view of provisions contained in Sections 33, 35 and 38 of the Indian Stamp Act and Section 107 of Transfer of Property Act read with Section 17 of Registration Act. The defendant avers that during the tenure of

license, she constructed super structure, with her own funds and resources, with the due authority of the plaintiff, at a cost more than Rs.50.00 lakhs and as such this license has become irrevocable as per Section 60 of Indian Easement Act. In view of all these pleas taken by the defendant and her having filed a counter claim against the plaintiff, it cannot be said that the defendant had made unambiguous and unconditional and categoric admissions entitling the plaintiff to a decree under Order 12 Rule 6 CPC. The defendant has raised certain triable issues which could not be adjudicated without trial.

4. Dealing with the scope of the provisions under Order 12 Rule 6 CPC, the Supreme Court in the case of Uttam Singh Duggal & CO. Ltd. Vs. Union of India & Ors. 2000 (7) SCC 120 held thus:

"Where a claim is admitted, the court has jurisdiction to enter a judgment for the plaintiff and to pass a decree on admitted claim. The object of the Rule is to enable the party to obtain a speedy judgment at least to the extent of the relief to which according to the admission of the defendant, the plaintiff is entitled. We should not unduly narrow down the meaning of this Rule as the object is to enable a party to obtain a speedy judgment. Where the other party has made a plain admission entitling the former to succeed, it should apply and also wherever there is a clear admission of facts in the face of which it is impossible for the party making such admission to succeed."

5. In the case Delhi Jal Board Vs. Surendra P. Malik 2003 111 AD Delhi 419, the Division Bench of this Court, dealing with the provisions of Order 12 Rule 6 CPC held thus:

"The test, therefore, is (i) whether admissions of fact arise in the suit, (ii) whether such admissions are plain, unambiguous and unequivocal, (iii) whether the defense set up is such that it requires evidence for determination of the issues and (iv) whether objections raised against rendering the judgment are such which go to the root of the matter or whether these are inconsequential making it impossible for the party to succeed even if entertained. It is immaterial at what stage the judgment is sought or whether admissions of fact are found expressly in the pleadings or not because such admissions could be gathered even constructively for the purpose of rendering a speedy judgment."

6. There being no categoric, unequivocal admission by the defendant, the plaintiff was not entitled to seek a decree of the reliefs in terms of prayers (a), (b) and (e) of the plaint against the defendant on the touch stone of Order 12 Rule 6 CPC. Accordingly, the application stands dismissed.

I.A.21072/2012 (under Order 7 Rule 11 CPC by defendant)

7. The application under Order 7 Rule 11 CPC is filed by the defendant seeking rejection of plaint, on the ground that suit has not been properly valued for the purpose of court fees and jurisdiction and the requisite court fees as per the Court Fees (Delhi Amendment) Act, 2012 has not been paid. It is stated that this amendment came into

force with effect from 01.08.2012 and as per this ad valorem court fees was payable. In the case of relief valued at Rs.20.00 lakhs and above, the Court fee was payable @ 4%. It is submitted that the suit having been filed in September, 2012, when the amendment was in force, the plaintiff has filed the court fees as per the old rates and not at the rate of 4% and thus, the plaint was liable to be rejected on this ground. It is also stated that the relief of possession could not be availed by the plaintiff inasmuch as the defendant had, with the consent of the plaintiff, raised extensive construction and thus she has independent right over the super structure and till such time the super structure existed, the possession could not be taken by the plaintiff.

8. So far as the plea regarding the suit having not been properly valued for the purpose of court fees and jurisdiction and requisite court fees not paid, this plea is not available to the defendant, pursuant to the latest judgment of this Court in the case of Delhi High Court Bar Association & Anr. v. Govt. of NCT of Delhi & Anr., WP (C) No. 4770/2012. Striking down the Court Fees (Delhi Amendment) Act, 2012 as being unconstitutional, this Court has held:

"The imposition of the court fee by percentage without a maximum limit is unrelated to the cost of any service rendered. The ad valorem levy of court fee after a particular level, loses all elements of quid pro quo and, therefore, loses the characteristics of a „fee‟. It thus tantamounts to recovery of amounts towards general revenue under the guise of court fees and, therefore, partakes all characteristics of a „tax‟ which is beyond the legislative competence of the Delhi Legislative Assembly."

9. Therefore, the Court Fees that is now applicable is as per the old Act. Thus, the plea of deficiency of Court Fees, as per the amendment Act 2012, no longer survives. The plea that possession could not be taken by the plaintiff till the existence of super structure is no ground for rejection of plaint.

10. The law with regard to the consideration of application under Order 7 Rule 11 CPC has been repeatedly laid down by various judicial pronouncements. A reference can be made to Saleem Bhai Vs. State of Maharashtra, (2003) 1 SCC 557, wherein, the Supreme Court in para 9 held as under:

"9. A perusal of Order VII Rule 11 C.P.C. makes it clear that the relevant facts which need to be looked into for deciding an application thereunder are the averments in the plaint. The trial court can exercise the power under Order VII Rule 11 C.P.C. at any state of the suit - before registering the plaint or after issuing summons to the defendant at any time before the conclusion of the trial. For the purposes of deciding an application under Clauses (a) and (d) of Rule 11 of Order VII C.P.C., the averments in the plaint are germane; the pleas taken by the defendant in the written statement would be wholly irrelevant at that stage, therefore, a direction to file the written statement without deciding the application under Order VII Rule 11 C.P.C. cannot but be procedural

irregularity touching the exercise of jurisdiction by the trial court".

11. The application has no merits and thus dismissed.

I.A. 1992/2013 (application on behalf of the defendant under Sections 33, 35 and 38 of the Indian stamps Act, 1899 r/w Section 49 of the Registration Act, 1908 for impounding of the documents filed and relied upon by the plaintiff in support of his case)

12. The plea that has been taken in the instant application is based on the premise that the agreement dated 9th February 2012 was the last that was executed between the parties and the same being unregistered under Section 17(1) of the Registration Act, 1908, the same could not be admitted in evidence as per Section 49 of the Registration Act, and being insufficiently stamped, was liable to be impounded under Section 33 of the Indian Stamp Act, 1899 and for making it admissible in evidence, deficient court fees as also penalty as contemplated under Section 35 of the Indian Stamp Act, 1989 was liable to be paid by the plaintiff.

13. There is no dispute that as per Section 17(1)(d) of the Registration Act, 1908 lease of immovable property from year to year, or for any term exceeding one year, or reserving a yearly rent is compulsorily registrable. As per Section 49, unless such a document was registered, it could not (a) affect any immovable property comprised therein; (b) confer any power to adopt; or (c) be received as evidence of any transaction affecting such property or conferring such power. However, as per proviso such a document may be received as

evidence of any collateral transaction not required to be effected by registered instrument. Further, as per this proviso any unregistered document affecting immovable property and required by this Act or the Transfer of Property Act, 1882 to be registered may be received as evidence of a contract in a suit for specific performance under Chapter II of the Specific Relief Act, 1877. In New Okhala Industrial Development Authority (NOIDA) Vs. Army Welfare Housing Organization, (2010) 9 SCC 354 also it was held:

"Lease deed or sub-lease of immovable property would be compulsorily registrable under section 17(1)(d) of the Act and section 107 of the Transfer of Property Act. In the absence of such a document, section 49 visualises no legal effect or an effective transfer by way of lease or sub-lease."

14. Now it may be noted that Section 3 of Indian Stamp Act, 1899 provides certain categories of instruments to be charged with stamp duty. Article 35 of Schedule-I provides about stamp duty which is payable on under-lease or sub lease. As per clause (a) (ii) of this Article, the stamp duty of the lease purporting to be for a term of not less than one year but not more than three years is payable as that of a Bond specified under Article 15 for the amount or value of the average annual rent reserved. As per Article 15 of Schedule-I, as applicable to Delhi, the stamp duty on a Bond is equivalent to 2% and 0.5%.

15. From the all this, it prima facie appears that in the case of a lease of not less than one year and not more than three years, the stamp duty as payable would be of the value of the average annual rent reserved.

If that be the situation, the stamp duty of Rs.50.00, as paid in the instant case, would be apparently deficient. Further, as per Section 33 of the Indian Stamp Act such an insufficiently stamped instrument was liable to be impounded and as per Section 35 thereof, it could only be admitted in evidence after the deficiency of stamp duty along with prescribed penalty thereon was paid.

16. The law with regard to such an instrument is well settled. In the case of Rasheeda Siddiqui Vs. Mustafa Aleem Siddiqui, 2011 (185) DLT 151 this Court held as under:

"it would thus be seen that whenever an instrument which is not stamped or is inadequately stamped is filed in a Court (which by law as authority to receive evidence), it is required to be impounded, but the Court has to admit such a document in evidence if the person relying upon the document pays the deficient stamp duty along with a penalty which is ten times the amount of deficient stamp duty. The Court after payment of the deficient stamp duty along with the prescribed penalty is required to forward a copy of the instrument along with the requisite certificate indicating the amount of duty as well as the penalty, to the Collector who may, in his discretion, remit such portion of the penalty as he may deem appropriate. In such a case, the original document need not be sent to the Collector. If however, the deficient stamp duty along with requisite penalty is not paid, the court is required to send the document, in original to the Collector."

17. In Chilakuri Gangulappa Vs. Revenue Divisional Officer, Madanpalle & Anr. (2001) 4 SCC 197 the Supreme Court was of the

view that the trial Court should have asked the appellant as to whether he would remit the deficient portion of the stamp duty together with a penalty amounting to ten times of the deficient stamp duty and if the appellant agreed to do so it had to proceed with the trial after admitting the documents in evidence and it had in the meanwhile to forward a copy of the document to the Collector for the purpose of adjudicating on the question of deficiency of stamp duty as provided in Section 40(1)(b) of the Act. It was further observed that only if the appellant was unwilling to remit the amount, the Court was to forward the original of the document itself to the Collector for the purpose of adjudicating on the question of deficiency of the stamp duty.

18. However, the question for determination is as to who is liable to pay the said stamp duty. As per Section 29 (c), in the absence of an agreement to the contrary, it was the responsibility of the lessee to pay the chargeable stamp duty. As per this, it is the responsibility of the defendant to pay the stamp duty. Here it is the defendant who is rather opposing the reliance by the plaintiff on such a document. Section 44 of the Indian Stamp Act takes care of such a situation. Where any person pays any duty or penalty under Section 35, 37, 40 or 41, in respect of an instrument, on behalf of any other person, who was under a responsibility to pay under Section 29, such person who pays, shall be entitled to recover from such other person, the amount of duty or penalty so paid by him.

19. From all this, the conclusion comes out to be that it is the responsibility of the defendant to pay the stamp duty as per Section 29(c), but since the defendant has objected to the taking of this document on record or reliance thereon by the plaintiff, and has called upon the plaintiff to pay the stamp duty, the plaintiff in such a situation can be asked to pay the stamp duty along with the penalty and later recover the same from the defendant.

20. But, that is not the end of the matter. The controversy which has been raised does not lead to logical conclusion that the agreements which are the basis of the instant suit are in fact the lease agreements, when undisputedly not only that they are titled as license deeds, but as per the case of both the parties, the suit premises was initially licensed by the plaintiff to the defendant. It is a triable question as to whether the agreements in question would be treated as lease deeds for all purposes and thus compulsorily registrable and stamped as above, or only be confined to license agreements, not requiring compulsory registration or the stamping of the type as required in the case of lease agreements. This is a triable issue and since the defendant has already taken such a plea in his written statement and for which a specific issue is required to be framed for determination, at this stage it cannot be conclusively said when certainty that the agreements in question are lease agreements and thus require stamping and registration for being admissible in evidence. In view of all this no case of impounding or of calling upon the plaintiff to pay the stamp duty thereon at this stage has been made out. If a finding is recorded that the agreements in question

are lease deeds, then in that eventuality the necessary action as contemplated in Section 33 read with Section 35 of the Indian Stamp Act read with Section 49 Registration Act would be considered.

21. In view of all this, the application has no merit and is dismissed. To list before Joint Registrar on 11.12.2013 for admission-denial of documents.

M.L. MEHTA, J.

OCTOBER 29, 2013 acm