Smt. Yeluvolu Blessy Sheeba vs Smt. Amgoth Anitha Nayak
2023 Latest Caselaw 2996 Tel

      THE HONOURABLE DR.JUSTICE G.RADHA RANI

           CIVIL REVISION PETITION NO.1769 of 2023

O R D E R:

This Civil Revision Petition is filed by the petitioner - plaintiff aggrieved

by the order and decree passed by the Principal District Judge, Hanumakonda in

I.A.No.630 of 2023 in O.S.No.188 of 2022 (Old O.S.No.99 of 2016) dated

15.06.2023.

2. The brief facts of the case are that the plaintiff filed a suit for specific

performance of agreement of sale dated 31.10.2007 and for permanent

injunction. The plaintiff was in possession of the schedule property as a tenant.

The defendant to meet her family requirements offered to sell the same for a

total sale consideration of Rs.20,50,000/- and on receipt of a huge amount of

Rs.15,00,000/- as advance sale consideration, which was about 73% of the total

sale consideration, the defendant inducted the plaintiff into possession by virtue

of the agreement of sale dated 31.10.2007 and agreed to execute the registered

sale deed on receipt of balance sale consideration. The defendant failed to

furnish copy of her title deed documents to prepare a draft sale deed. The

defendant postponed to handover the original title deed documents stating that

she was yet to clear off the loans to get it released from her creditor. However,

the defendant issued a legal notice on 12.07.2016 to the plaintiff intimating

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about the cancellation of the agreement of sale dated 31.10.2007 stating that it

was barred by limitation and that the plaintiff was not ready to pay the balance

sale consideration amount within three years from 31.10.2007 and demanded

the plaintiff to vacate the premises claiming damages of Rs.30,000/- per month.

The plaintiff got issued a reply legal notice on 21.07.2016 expressing her

willingness to perform her part of the agreement and to receive the balance sale

consideration within 15 days from the date of receipt of the legal notice. But

the said notice was returned un-served on the defendant as refused. Hence, the

plaintiff filed the suit for specific performance of agreement of sale also seeking

the relief of permanent injunction.

3. The defendant filed written statement contending that the plaintiff was a

tenant in the schedule house prior to the alleged agreement and she was

continuing in possession in that status. The suit schedule premises was let out

to the plaintiff on oral lease on 09.01.2004 on a monthly rent of Rs.6,000/-.

Thereafter, the plaintiff approached the defendant and forced the defendant to

sell the suit house. The defendant agreed to sell the same. The agreement of

sale was reduced into writing on 31.10.2007. The sale consideration was fixed

at Rs.20,50,000/-. As on the date of agreement of sale, a sum of Rs.15,00,000/-

was received by the defendant towards advance sale consideration and the said

fact was mentioned in the agreement of sale. It was mutually understood

between the defendant and the plaintiff that the balance sale consideration of

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Rs.5,50,000/- would be payable within a short time. By virtue of the said

agreement of sale, no possession was delivered and the plaintiff was never

inducted into the suit premises in that status. The possession of the plaintiff

over the schedule premises was only in the capacity of tenant but not as a

purchaser. The said fact was categorically mentioned in clause (3) of the

agreement. It was mutually agreed that time was essence of the contract. The

plaintiff failed to pay the balance sale consideration within three years from

31.10.2007, which lapsed by 30.10.2010. In view of the latches on the part of

the plaintiff, the agreement was cancelled, the contract was terminated. The

defendant issued legal notice dated 12.07.2016 informing the plaintiff that the

advance amount of Rs.15,00,000/- was forfeited and the agreement was

terminated and demanded the plaintiff to vacate the premises and to pay

Rs.30,000/- towards damages every month from 01.10.2016 till she vacated the

premises.

3.1. The defendant further stated that she also filed O.S.761 of 2016 on

21.09.2016 against the plaintiff for eviction on the file of the VII Additional

Junior Civil Judge, Warangal and also claimed mesne profits in the said suit.

She further stated that the alleged agreement of sale dated 31.10.2007 was an

outright sale deed as per the recitals in the document and the same was

inadmissible in evidence and was barred under Section 35 of the Stamp Act,

1899. The same was compulsorily registerable under Sections 17 and 49 of the

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Registration Act, 1908. In the absence of payment of requisite stamp duty, the

alleged documents could not be looked into as the same was barred by law and

stamp duty and penalty shall be collected on the said document.

4. After framing the issues, the suit was posted for trial.

5. On 28.03.2023, the plaintiff filed her evidence affidavit and got marked

Exs.A1 to A8. The defendant was not present at that time and there was no

representation for the defendant. The court marked the agreement of sale

dated 31.10.2007 as Ex.A1 on the basis of the chief-examination affidavit of

PW.1. When the matter was coming up for cross-examination of PW.1, the

defendant filed a petition under Order XIII Rule 3 read with Sections 33 and 35

of the Stamp Act, 1899 and Sections 17 and 49 of the Registration Act, 1908

read with Section 151 of CPC to de-exhibit Ex.A1 agreement of sale and to hear

about the admissibility of the document with regard to payment of Stamp duty

and penalty stating that the same was marked without the knowledge and

consent of the defendant and the court failed to scrutinize the contents of the

said document.

6. The plaintiff filed counter to the said application contending that once a

document had been admitted in evidence, such admission could not be called in

question at any stage of the suit or proceedings and all the objections had to be

raised before marking the document in evidence and once it was marked, it was

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not open either to the parties or even to the court to re-examine the order. The

plaintiff also contended that though possession was delivered as per the

agreement of sale, the right and title in the schedule property remained with the

defendant. Under the said circumstances, the provision of Sections 33 and 35 of

the Stamp Act, 1899 were not attracted. When there was contemplation of

execution of further document i.e. registration of sale deed in future in

pursuance of Ex.A1, the transferee though in possession would be holding the

property as an agreement holder but not with any clear animus that she has

become absolute owner of the property or in complete negation of any right or

title of the transferor and the provisions of Sections 33 and 35 of the Stamp Act

were not attracted. Since the suit was for specific performance, none of the

provisions of the Registration Act were affected.

7. On hearing both the counsel, the learned Principal District Judge,

Hanumakonda allowed the application ordering de-exhibiting of Ex.A1 holding

that the plaintiff was at liberty to get the agreement of sale dated 31.10.2007

impounded under law by paying deficit stamp duty and penalty as required

under Article 47-A of Schedule 1-A of the Stamp Act.

8. Aggrieved by the said order and decree, the plaintiff preferred this

revision contending that the respondent - defendant filed the petition without

the support of any provision of law under the Code of Civil Procedure or any

supportive statute and the court ought to have rejected the petition filed by the

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respondent - defendant at the threshold. The court below failed to appreciate

the law and the citations referred to by the petitioner - plaintiff in her written

arguments. The court below failed to appreciate the fact that the respondent -

defendant and her advocate failed to present themselves on the date of marking

of documents on behalf of the petitioner - plaintiff as PW.1 and their failure

could not be attributed to the petitioner - plaintiff for de-exhibiting the marked

exhibit as Ex.A1. The court below failed to appreciate that even though

delivery of possession was mentioned in Ex.A1, it would not change its

character, as it would be concluded by execution of regular conveyance deed.

The document pressed into service by the petitioner - plaintiff was for the relief

of specific performance in her favour. It does not hit the language employed in

Section 17 of the Indian Stamp Act and Section 49 of the Registration Act. The

court below ought to have considered it as an agreement to be enforced through

specific performance and could have rejected the petition filed by the

respondent - defendant. Even as per the pleadings advanced by the

respondent - defendant, she unilaterally issued the notice to the petitioner -

plaintiff cancelling the agreement of sale entered with the petitioner - plaintiff.

Contrary to that, she could not plead in the petition that the document executed

by her was a sale deed which required stamp duty on it. The respondent -

defendant conveniently deviated from her own pleadings in the petition. The

court below ought to have seen that as per the recitals of Ex.A1, the outstanding

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amount of Rs.5,50,000/- of the total sale consideration, had to be paid by the

petitioner - plaintiff, then only, the transaction of sale between them would be

concluded. Once, the court admitted the document and marked it as an exhibit

in the suit, the court could not revert its order without any support of statutory

law or authority. De-exhibiting Ex.A1 by the court below was against the

settled law and procedure contemplated. As per Section 36 of the Stamp Act,

wherein an instrument had been admitted in evidence, such admission shall not,

except as provided under Section 61, be called in question at any stage of the

suit or proceedings on the ground that, the instrument had not been duly

stamped. The court below ignored the above provision and prayed to set aside

the order passed by the Principal District Judge, Hanumakonda in I.A.No.630 of

2023 in O.S.No.188 of 2022 dated 15.06.2023.

9. Heard the learned counsel for the revision petitioner - plaintiff and the

learned counsel for the respondent - defendant.

10. As seen from the record, the petition in I.A.No.630 of 2023 in

O.S.No.188 of 2022 was filed by the respondent - defendant under Order XIII

Rule 3 of CPC read with Sections 33 and 35 of the Stamp Act and Section 17

and 49 of the Registration Act read with Section 151 of CPC for de-exhibiting

Ex.A1 agreement of sale. Thus, this Court does not find any merit in the

contention of the learned counsel for the revision petitioner - plaintiff that the

respondent - defendant filed the petition without support of any provision of

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law under the Code of Civil Procedure or any supportive statute and the said

petition was liable to be rejected at the threshold.

11. The other contention taken by the learned counsel for the revision

petitioner - plaintiff was that the respondent - defendant and her advocate failed

to present themselves on the date of marking of document on behalf of the

petitioner - plaintiff as PW.1 and their failure could not be attributed to the

revision petitioner - plaintiff for de-exhibiting the marked exhibit as Ex.A1.

12. On a perusal of the pleadings, the respondent - defendant in her written

statement itself contended that the said document agreement of sale was barred

by law under Section 35 of the Stamp Act and that the same was compulsorily

registerable under Sections 17 and 49 of the Registration Act and it should be

treated as an outright sale deed and stamp duty and penalty should be collected

and that the said document could not be received even in a suit for specific

performance of contract and the same was inadmissible in evidence. But

ignoring the said contentions, the trial court marked the said document as Ex.A1

on 28.03.2023 in the absence of the defendant or her counsel. The trial court in

its order in I.A.No.630 of 2023 noted that the court did not notice due to

oversight about insufficiency of stamp duty on the said document at the time of

its marking as exhibit and the advocate for plaintiff also did not bring to the

notice of the court about the said fact.

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13. Notice should be given to the respondent - defendant at the time of filing

of the evidence affidavit of PW.1 and the defendant or her counsel need to be

present at the time of recording the evidence of PW.1 and marking the

documents and they need to raise the necessary objections for marking the

documents. It was not known whether any notice was given to the respondent -

defendant on the chief affidavit of PW.1. The defendant or her counsel failed to

be present at the time of recording the evidence of PW.1 and marking the

documents. The court itself also need to be careful while marking the

documents and need to look into whether the documents would require any

stamp duty or penalty or they were in accordance with the provisions of law.

When the matter was posted for the cross-examination of PW.1, the respondent

- defendant immediately filed I.A.No.630 of 2023 to de-exhibit Ex.A1 and to

hear with regard to the admissibility of the said document.

14. The learned counsel for the respondent - defendant placed reliance on the

judgment of the combined High Court of Andhra Pradesh and Telangana in

Syed Yousuf Ali v. Mohd.Yousuf and Others 1, wherein also it was contended

that when a document is admitted and marked as exhibit, it could not be

questioned except under Section 61 in view of interdict contained under Section

36 of Indian Stamp Act, it was held that:

C.R.P.No.4794 of 2015 dated 05.02.2016

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"16. No doubt, Section 36 of the Act created an interdict to raise an objection about admissibility of document, once admitted, except under Section 61, it is the duty of the Court to apply its mind about the admissibility and determine judicially but the Presiding Officer failed to look into the admissibility of the document for want of stamp duty and penalty.

Putting signature on the stamp of marking on the document cannot be considered as admission of a document in evidence. When similar issue came up before Division Bench of this Court in W.P.No.29434 of 2013, dated 12.02.2014, placing reliance on judgment of Apex Court in R.V.E.Venkatachala Gounder v. Arulmigu Viswesaraswami [AIR 2003 SC 4548] and V.P.Temple and another and Ram Rattan (dead) by legal representatives v. Bajranlal and others [AIR 1978 SC 1393] drawn distinction between admitting in evidence and marking of document. Marking of a document is only for convenient reference, whereas, admitting document is taking the document as evidence after applying judicial mind. In view of principle laid down in R.V.E.Venkatachala Gounders case [AIR 2003 SC 4548] and Ram Rattan (dead) by LRs case [AIR 1978 SC 1393], the parties can raise objection as to admissibility of document and mere marking of document for convenience of reference would not preclude the parties to raise objection as to the admissibility. In R.V.E.Venkatachala Gounders case [AIR 2003 SC 4548], the Apex Court is of the view that merely because a document is marked as exhibit an objection as to its admissibility is not excluded and is available to be raised even at a later stage or even in appeal or revision.

Similarly in Ram Rattan's case [AIR 1978 SC 1393], the Supreme Court is of the view that when the document was tendered in evidence by the plaintiff while in witness box, objection has been raised by the defendants that the document was inadmissible in evidence as it was not only insufficiently stamped, but also for want of registration, it was obligatory upon the learned trial judge to apply his mind to the objection raised and decide the objection in accordance with law. Tendency sometimes is to postpone the decision to avoid interruption in the process

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of recording evidence and therefore, a very convenient device is resorted to, of marking the document in evidence subject to objection. 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. 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 tentatively marked and in such a situation, Section 36 would not attract. Though facts are different, the law laid down by the Courts time and again is that to admit a document in evidence the Court has to apply its mind and decide the admissibility of document in evidence, judicially, mere marking for convenience of reference itself would not amount to admitting the document by applying judicial mind and it is not a judicial determination as to the admissibility of document in evidence. Section 35 created clear embargo against acting upon insufficiently stamped document for any purpose. Any purpose would include collateral purpose. Even if both parties gave consent for marking insufficiently stamped document, it shall not be act upon, more particularly to enforce the right of parties under contract of sale, unless it falls under any clauses of proviso. The present document does not fall within any of the clauses of proviso to Section 35 of the Act, when document shall not be acted upon admitting the same by consent would mean that it is the duty of the Court to decide admissibility of document in evidence judicially.

17. In such situation, the bar under Section 36 of the Act would not come in the way of the parties to raise an objection as to the admissibility of the document. In the present case except affixing stamp giving numerical number to the possessory contract of sale as Ex.A.1, signing thereon by officer, nothing discloses about the judicial determination of admissibility of

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possessory contract of sale. The provisions of Stamp Act are fiscal in nature and such provisions have to be construed strictly, at the same time, it is the duty of the office to decide or determine judicially about admissibility of the document, irrespective of objection to avoid loss of revenue to the State. In the absence of any judicial determination about admissibility of the document, the same can be questioned at a later stage though stamp is affixed marking the document as exhibit."

15. In the present case also, there is no judicial determination about the

admissibility of the document at the time of its marking. As per the judgment of

the Hon'ble Apex Court in R.V.E.Venkatachala Gounder v. Arulmigu

Viswesaraswami [AIR 2003 SC 4548], merely because the document was

marked as an exhibit, an objection as to its admissibility was not excluded and

the same was available to be raised even at a later stage or even in appeal or

revision.

16. The learned counsel for the revision petitioner relied upon the judgment

of the Hon'ble Apex Court in Sirikonda Madhava Rao v. N.Hemalatha and

Others 2 on the aspect that once a document has been admitted in evidence, such

admission cannot be called in question at any stage of the suit or proceedings on

the ground that the instrument has not been duly stamped. Objection as to

admissibility of a document on the ground of insufficiency of stamp, has to be

raised when the document is tendered in evidence. Thereafter, it is not open to

the parties, or even to the court to re-examine the order or issue.

2022 Live Law 970

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17. The judgment of the Hon'ble Apex Court in R.V.E.Venkatachala

Gounder v. Arulmigu Viswesaraswami [AIR 2003 SC 4548] was not referred

in the above case. As there was a detailed discussion in the above case by the

Hon'ble Apex Court between admitting a document in evidence and marking of

document and the said judgment was not considered by the Hon'ble Apex Court

while rendering its order in the above case, this Court does not find any merit in

the contention of the learned counsel for the revision petitioner - plaintiff that it

was not open to the parties to re-examine the order or issue with regard to

marking the document as an exhibit.

18. The High Court of Andhra Pradesh in Syed Yousuf Ali's Case (cited

supra) also held that:

"21. When the documents were marked as exhibits in the absence of defendant or his counsel and without considering the nature of the document by the Court, assigning exhibit number cannot be said to be admitted in evidence and interdict contained in Section 36 would not come to the aid of the party in whose evidence the document was marked as exhibit without any judicial determination, totally debarring the adversary to challenge the admissibility of document in evidence. In Vemireddy Kota Reddy's Case [2004 (3) ALD 187], single Judge of this Court relied on Javer Chand and others v. Pukhraj Surana to conclude that marking of a document is assigning exhibit number without judicial determination would not amount to admitting document in evidence and such objection can be raised at later point of time.

22. Whereas, learned counsel for the respondents placed reliance in T.Nagaratnam's

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case [2006 (3) ALD 838], so also M.Narasimhulu's case [1996 Law Suit (AP) 447] and Isra Fatima's case [2002 Law Suit 832]. In all the three judgments, the single Judges of this Court decided the bar contained under Section 36 of Indian Stamp Act holding that until and unless there is a judicial determination it cannot be said that it has been admitted in evidence though it is marked. Mere marking of document itself is not sufficient and there should be judicial determination as to the nature of document and its admissibility. Further the words admitted in evidence appearing under Section 36 of the Act means admitted after judicial consideration of objections relating to admissibility. In the absence of judicial determination marking of document mechanically is an illegality. Even otherwise at any stage of the suit, the Court may reject any document which it considers irrelevant or otherwise inadmissible in view of Order 13 Rule 3 CPC.

24. According to Order 13 Rule 3 CPC the Court may at any stage of the suit, reject any document which it considers irrelevant or otherwise inadmissible, recording the grounds for such rejection. Order 13 Rule 4 CPC prescribes an endorsement to be made on the document when a document is admitted in evidence. According to it, there shall be an endorsement on every document which has been admitted in evidence containing number and title of the suit, the name of the person producing the document, the date on which it was produced and a statement of its having been so admitted and the endorsement shall be signed or initialled by the Judge.

25. Here there is an endorsement on the reverse of possessory contract of sale consisting the details under Order 13 Rule 4(1)(A) to (C), 1(D) is absent. Therefore, the document cannot be said to be admitted after judicial determination, in such a case, exercising power under Order 13 Rule 3 CPC, the Court can reject any document which it considers irrelevant or in-admissible, recording reasons.

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19. In the present case also, as there is no judicial determination about the

admissibility of Ex.A1, this Court agrees with the view taken by the High Court

of Andhra Pradesh in Syed Yousuf Ali's case (cited supra) and finds no merit in

the contention of the learned counsel for the revision petitioner on this aspect.

20. The other contention raised by the learned counsel for the revision

petitioner was that even though delivery of possession was mentioned in the

document, the agreement of sale would not change its character as a transaction

of sale, as the transaction would be concluded only by execution of regular

conveyance deed. The recitals of the document would show that it was only an

agreement of sale and as such not hit by the language employed in Section 17 of

the Indian Stamp Act and also Section 49 of the Registration Act and relied

upon the judgment of the High Court of Telangana and Andhra Pradesh in

Bhimavarapu Laxma Reddy v. Pallothu Aswini Kumar 3 on the aspect that

an agreement holder, even if in possession and enjoyment of property, does not

acquire any title to property. Entries in the revenue records whether pursuant to

the mutation or without mutation also do not confer title.

2015 (5) ALD 500

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21. The learned counsel for the revision petitioner also relied upon the

judgment of the Hon'ble Apex Court in Achal Reddi v. Ramakrishna Reddiar

and Others 4, wherein also it was held by the Hon'ble Apex Court that:

"In the case of an agreement of sale the party who obtains possession, acknowledges title of the vendor even though the agreement of sale may be invalid. It is an acknowledgement and recognition of the title of the vendor which excludes the theory of adverse possession. The well-settled rule of law is that if person is in actual possession and has a right to possession under a title involving a due recognition of the owner's title his possession will not be regarded as adverse in law, even though he claims under another title having regard to the well recognized policy of law that possession is never considered adverse if it is referable to a lawful title. The purchaser who got to possession under an executory contract of sale in a permissible character cannot be heard to contend that his possession was adverse. In the conception of adverse possession there is an essential and basic difference between a case in which the other party is put in possession of property by an outright transfer, both parties stipulating for a total divestiture of all the rights of the transferor in the property, and in case in which, there is a mere executory agreement of transfer both parties contemplating a deed of transfer to be executed at a later point of time. In the latter case the principle of estoppel applies estopping the transferee from contending that his possession, while the contract remained executory in stage, was in his own right and adversely against the transferor. Adverse possession implies that it commenced in wrong and is

AIR 1990 SC 553

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maintained against right. When the commencement and continuance of possession is legal and proper, referable to a contract, it cannot be adverse."

22. Both the above judgments are rendered while considering whether a

purchaser who was put in possession basing on an executory contract of sale

would acquire title over it. These judgments are not relevant for considering

whether the stamp duty is payable or not on the agreement of sale when the

purchaser was put in possession of the property.

23. The learned counsel for the revision petitioner also relied upon the

judgment of the High Court of Punjab and Haryana in Ram Kishan and

Another v. Bijeder Mann @ Vijender Mann and Others 5, wherein it was

considered that though a purchaser was put in possession by way of agreement

to sell, if the buyer fails to pay the balance sale consideration within the

prescribed time and does not apply for extention of time, the seller would be

entitled to get the contract rescinded and therefore the document cannot be

considered as a sale deed but only an agreement to sell. This judgment is also

not applicable to the facts of this case as it was also not rendered under the

provisions of the Stamp Act.

2015 Law Suit (P&H) 4786

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24. The other judgment relied by the learned counsel for the revision

petitioner was that of the Hon'ble Apex Court in R.Hemalatha v. Kasthuri 6,

wherein it was held that:

"an unregistered document affecting the immovable property and required by the Registration Act or the Transfer of Property Act to be registered, may be received as evidence of a contract in a suit for specific performance under Chapter­II of the Specific Relief Act, 1877 or as evidence of any collateral transaction not required to be affected by registered instrument as per proviso to Section 49 of the Registration Act. However, the same is subject to Section 17 (1A) of the Registration Act.

25. There is no dispute with the proposition laid down by the Hon'ble Apex

Court that as per proviso to Section 49 of the Registration Act, an unregistered

agreement to sell shall be admissible in evidence in a suit for specific

performance and the proviso is exception to the first part of the Section 49. The

said judgment is rendered while considering the effect of Tamilnadu

Amendment by which Section 17(1)(g) of the Registration Act had been

inserted which makes agreement to sell immovable property valued above

Rs.100/- compulsorily registerable. The Hon'ble Apex Court held that the

amendment would not affect proviso to Section 49, which allows un-registered

sale agreements to be received in evidence, an un-registered agreement to sell

immovable property can be received in evidence in a suit for specific

performance.

2023 Live Law (SC) 304

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26. The only question now to be decided is: whether an agreement to sell

coupled with possession can be received in evidence without payment of the

requisite stamp duty and penalty.

27. The learned counsel for the respondent on the other hand relied upon the

judgment of the Hon'ble Apex Court in Omprakash v. Laxminarayan and

Others 7, wherein on similar facts, it was held that:

"11. As stated earlier, the plaintiffs filed a suit for specific performance of contract and their case is founded on the agreement to sell executed on 27th December, 2000. The agreement to sell acknowledges payment of the part of consideration money and further giving actual physical possession to the purchaser by the seller. Though the defendants dispute that, but in our opinion, for determination of the question of admissibility of a document, it is the recital therein which shall be decisive. Whether the possession in fact was given or not in terms of the agreement to sell is a question of fact which requires adjudication. But, at the time of considering the question of admissibility of document, it is the recital therein which shall govern the issue. It does not mean that the recital in the document shall be conclusive but for the purpose of admissibility it is the terms and conditions incorporated therein which shall hold the field. Having said that, we proceed to consider as to whether the document in question is "conveyance" within the meaning of Section 2(10) of the Act.

12. Section 2(10) of the Act reads as follows:

2. Definitions. - In this Act, unless there is something repugnant in the subject or context, -

(2014) 1 SCC 618

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(10)"Conveyance" -

'Conveyance' includes a conveyance on sale and every instrument by which property, whether movable or immovable, is transferred inter vivos and which is not otherwise specifically provided for by Schedule I;

13. From a plain reading of the aforesaid provision, it is evident that an instrument by which movable or immovable property is transferred, comes within the expression "conveyance". In the present case, an immovable property is transferred on payment of part of the consideration and handing over the possession of the property.

14. It is relevant here to state that by the Indian Stamp (Madhya Pradesh Second Amendment) Act, 1990 (Act No.22 of 1990) few Articles including Article 23 of Schedule 1-A have been substituted and Explanation has been added to Article 23. The Explanation appended to Article 23 of Schedule 1-A of the Stamp Act as substituted by Section (6) of Act 22 of 1990 reads as follows:

"Explanation.--For the purpose of this article, where in the case of agreement to sell immovable property, the possession of any immovable property is transferred to the purchaser before execution or after execution of, such agreement without executing the conveyance in respect thereof then such agreement to sell shall be deemed to be a conveyance and stamp duty thereon shall be leviable accordingly: Provided that, the provisions of Section 47-A shall apply mutatis mutandis to such agreement which is deemed to be a conveyance as aforesaid, as they apply to a conveyance under that section:

Provided further that where subsequently a conveyance is

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effected in pursuance of such agreement of sale the stamp duty, if any, already paid and recovered on the agreement of sale which is deemed to be a conveyance shall be adjusted towards the total duty leviable on the conveyance, subject to a minimum of Rs. 10."

The aforesaid Explanation has come into effect with effect from 26th September, 1990. The Explanation, therefore, creates a legal fiction. The agreement to sell shall be deemed to be a conveyance and stamp duty is leviable on an instrument whereby possession has been transferred. Thus the agreement to sell in question is a conveyance within the meaning of Section 2(10) of the Act and is to be duly stamped.

15. Section 35 of the Act makes instruments not duly stamped inadmissible in evidence, the relevant portion whereof reads as follows:

"35. Instruments not duly stamped inadmissible in evidence, etc.- No instrument chargeable with duty shall be admitted in evidence for any purpose by any person having by law or consent of parties authority to receive evidence, or shall be acted upon, registered or authenticated by any such person or by any public officer, unless such instrument is duly stamped:

Provided that-

(a) any such instrument shall be admitted in evidence on payment of the duty with which the same is chargeable or, in the case of an instrument insufficiently stamped, of the amount required to make up such duty, together with a penalty of five rupees, or, when ten times the amount of the proper duty or

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deficient portion thereof exceeds five rupees, of a sum equal to ten times such duty or portion;"

16. From a plain reading of the aforesaid provision, it is evident that an authority to receive evidence shall not admit any instrument unless it is duly stamped. An instrument not duly stamped shall be admitted in evidence on payment of the duty with which the same is chargeable or in the case of an instrument insufficiently stamped, of the amount required to make up such duty together with penalty. As we have observed earlier, the deed of agreement having been insufficiently stamped, the same was inadmissible in evidence. The court being an authority to receive a document in evidence to give effect thereto, the agreement to sell with possession is an instrument which requires payment of the stamp duty applicable to a deed of conveyance. Duty as required, has not been paid and, hence, the trial court rightly held the same to be inadmissible in evidence.

28. The facts of the above case as well as the reasoning given by the Hon'ble

Apex Court in considering the Stamp (Madhya Pradesh Second Amendment)

Act, 1990 are applicable mutatis mutandis to this case also.

29. He also relied upon the judgment of the Hon'ble Apex Court in

Navneetha Lokesh Puthran v. M.Suryanarayana Kalkura and Others 8 ,

wherein also it was held that:

"For the purpose of admissibility of a document it is recitals contained therein that are decisive and not factual situation on ground. Thus, as agreement to sell contained a clear recital that possession had been transferred to buyer, same shall be deemed to be a conveyance for computation of stamp duty under above-said Article 23 explanation - contention that

(2020) 19 SCC 8

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possession in fact not having been delivered to buyer is not relevant for computation of stamp duty.

30. The Hon'ble Apex Court in the above case held that even though

possession was in fact not delivered to the buyer, it was the recitals of the

document that were decisive for the purpose of admissibility of a document.

The said judgment was rendered under Sections 35, 33 and 38 and

Schedule 1-A of Article 23 of the Stamp (Madhya Pradesh Second Amendment)

Act, 1990.

31. The learned counsel for the respondent also relied upon the judgment of

the High Court of Andhra Pradesh in K.J.K.Setty v. K.N.Setty 9, wherein also

possession was delivered basing on an agreement of sale, it was held that:

"12. In the present case, suit itself is filed by the respondent/plaintiff for specific performance of a contract and recitals of the document as referred supra clearly shows that there is a clause of executing registered sale deed after receiving Rs.4,00,000/- within three months which itself shows that document is agreement of sale though it is between co-owners wherein there is a recitals with regard to delivery of possession and document, which is an agreement of sale is followed by delivery of possession. This Court in Makineni Srinivas Rao and others v. Manthena Prabhakar Reddy [2014 (6) AndhLD 261] had an occasion to consider the scope of Explanation I of Article 47-A of Schedule I-A of the Indian Stamp Act, 1899 and opined at Para Nos.7 to 11 which extracted hereunder:

"7. Explanation I of Article 47-A of Schedule I-A of the Act envisages

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that an agreement to sell followed by or evidencing delivery of possession of the property agreed to be sold shall be chargeable as a "Sale". In the opinion of this Court, the words "followed by or evidencing delivery of possession of the property" shall be construed to mean that delivery of possession shall be concurrent with or immediately after the execution of agreement of sale and the said provision does not attract a case where delivery of possession takes place long time after the execution of the agreement of sale. The words "followed by or evidencing delivery of possession" in Explanation I fell for consideration of a Division Bench of this Court in B.

Ratnamala v. G.Rudramma [1999 (6) ALT 159: 1999 (6) AndhLD 160]. While reading the two phrases viz., "followed by" and "evidencing"

separately, the Bench held that in the former case, even in the absence of a recital in the agreement, the delivery must be contemporaneous with the execution of agreement and that possession should be intimately and inextricably connected with the agreement. In the latter case, it held that in order to attract this explanation, the agreement must contain a recital of delivery of possession either prior to or after the agreement.

8. On a careful reading of Explanation I and the Division Bench judgment in B. Ratnamala [1999 (6) ALT 159: 1999 (6) AndhLD 160], I am of the opinion that in cases where the agreement does not contain the recital of delivery of possession, it must be examined whether possession "followed" the agreement. What precisely is the meaning of the word "followed"? The Oxford dictionary,

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Thesaurus and Word power guide (Indian edition 2007) explained the meaning of the word "follow" as move or travel behind "go along"

"come after in time or order" "be a logical consequence of" "(follow through) continue (an action or task to its conclusion".

9. Thus, in the absence of express recital in the agreement on delivery of possession, in order to levy stamp duty chargeable to conveyance in respect of an agreement of sale, it must be shown that possession followed as a logical consequence of the agreement. As explained by the Apex Court in Veena Hansmukh Jain v. State of Maharashtra, by introducing Explanation I, the legislature intended that the stamp duty as applicable to conveyance shall be collected in advance where delivery of possession was involved at the agreement stage itself and execution of conveyance deed remains a mere formality.

10. Where the agreement does not contain the recital relating to possession, what needs to be seen is whether delivery of possession was in contemplation of the parties at the time of execution of the agreement itself. This can be ascertained with reference to the point of time of such delivery. If delivery is simultaneous to or concurrent or contemporaneous with the execution of agreement of sale, it can be safely concluded that the parties have intended delivery of possession though such a recital is absent in the agreement. If on the contrary there is a reasonable time lag between execution of agreement and delivery of possession, it cannot be construed that such delivery followed the agreement. At best it amounts to delivery of possession in

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pursuance of and not following the agreement of sale.

11. In my opinion, the legislature has consciously used the restrictive expression followed by preceding the words An agreement to sell in Explanation I. It has not used the expansive words such as in pursuance of for it evidently wanted levying and collection of stamp duty chargeable for conveyances only in cases where parties to agreement of sale intended delivery of possession at the agreement stage itself without waiting for execution of regular conveyance deed. It is trite that provisions of a fiscal statute need to be strictly construed."

13. The said decision is followed by this Court in Chunduru Abbaiah ... Petitioner v.

Garlapati Satyanarayana ... Respondent [2020 (6) ALT 305] though the said decision it is held that recitals of agreement of sale shows that possession was not delivered and ratio in the said decision is that if possession is followed by or evidencing delivery of possession as per the document, it requires stamp duty under Article 47-A of Schedule IA of Indian Stamp Act. This Court in G.Kiran Kumar .... Petitioner v.

N.Venkateswara Reddy and others ...

Respondent by following Judgment of Hon'ble Apex Court in C.R.P.No. 2874 of 2017, dated 20.12.2018 following ratio laid down by Hon'ble Apex Court in Omprakash v. Laxminarayan and others [(2014) 1 SCC 618] and after elaborately discussing precedent law held that agreement of sale, which is inadequately stamped has to be impounded as per provisions of stamp act.

14. On perusal of recitals of the document which also contains a recital that a future document can be executed which shows that transaction of sale is not completed unless another document is executed due to that it cannot be said that it is a unregistered sale deed though it contains recital with regard to delivery of possession and document evidencing delivery of property.

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Though the document is said to be agreement of sale evidencing delivery of possession which can be treated as "Conveyance", which can be received in evidence in part performance of a contract after collecting stamp duty and penalty as a sale as per Explanation I of Article 47-A of Schedule I of Indian Stamp Act. This Court in Ummadi Subramanyam v. Ekka Dhanamma and another [1999 (4) ALT 706] held that proviso of section 49 of Registration Act shows that an unregistered document effecting immovable property though required registration may be received in evidence of a contract in a suit for specific performance after collecting stamp duty and penalty."

32. In the light of the above judgments, it can be seen that it was the recitals

in the document which are decisive and conclusive of its admissibility. When

the agreement of sale dated 31.10.2007 is considered, clauses 1 to 4 under the

said agreement would disclose that:

1. The vendor hereby agree and promise to sell the schedule mentioned house property to the purchaser for a total sale consideration of Rs.20,50,000/-.

2. That the vendor had today received a sum of Rs.15,00,000/- in cash from the purchaser towards the advance sale consideration, the receipt of which the vendor herewith acknowledge and submit to the purchaser.

3. The purchaser is already in possession of the schedule mentioned house property as tenant and in view of the payment of considerable big amount of advance sale consideration paid by the purchaser to the vendor today, hence the vendor is today inducted the purchaser into possession by virtue of this agreement of sale.

4. The vendor hereby agreed to execute the registration of sale deed by receiving the balance sale consideration whenever called by the purchaser either in the name of the purchaser or in the name or names proposed by the purchaser.

33. Thus, though the purchaser was in possession as a tenant, it was clearly

mentioned that in lieu of receiving a sum of Rs.15,00,000/- out of total sale

consideration of Rs.20,50,000/- i.e.73% of the total sale consideration, the

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vendor inducted the purchaser into possession of the schedule property by virtue

of the agreement of sale.

34. Schedule 1-A of the Indian Stamp Act, 1899 which was applicable to the

State of Andhra Pradesh and Article 47-A, which was inserted by AP Act 17 of

1986 with effect from 16.08.1986, refers to the stamp duty payable for sale as

defined in Section 54 of Transfer of Property Act, 1882 and explanation (I) of it

would read as follows:

Article 47-A (Explanation-I) :- 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.

35. Thus, the recitals of the document would disclose that the purchaser was

inducted into possession by virtue of the agreement of sale. As per

Explanation-I of Article 47-A, when the agreement to sell was followed by

delivery of possession, the same was chargeable as a "sale", though a future

document can be executed which shows that the transaction of sale is not

completed, it shall be treated as a conveyance, as the agreement to sell was

followed by delivery of possession.

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36. At the time of delivering the order, the learned counsel for the petitioner

filed a citation of the Hon'ble Apex Court in Vijay Kumar Goyal (Dead) v.

Neena Rani and Others 10, wherein possession was not delivered under the

agreement and it was specifically mentioned in the agreement that possession of

the disputed land in question was already with the appellant, the Hon'ble Apex

Court held that:

"As per Entry No. 5 (cc) of Schedule 1-A applicable under the State of Punjab, "in the case of agreement to sell followed by or evidencing delivery of possession of the immovable property agreed to be sold", the stamp duty is leviable under Column No. 2 of Entry No. 23 of Schedule 1-A. As observed hereinabove, the plaintiff was already in possession prior to the execution of the aforesaid agreements as per the recitals in the aforesaid two agreements. It is to be noted that even the plaintiff has also not sought the possession in the suit filed by him and has in fact sought the permanent injunction restraining the defendants from interfering in the peaceful possession of the plaintiff and from dispossessing or causing to dispossess the plaintiff from the suit property.

5. In view of the above and for the reasons stated above, the order passed by the High Court and that of the Trial Court directing the appellant - original plaintiff to pay the deficient stamp duty with penalty applying Sub-column No. 2 of Column No. 2 of Entry No. 23 of Schedule 1-A as amended by the State of Punjab is unsustainable and the same deserves to be quashed and set aside."

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37. But in the present case, though the petitioner - plaintiff was in possession

of the suit property as a tenant, but subsequently after entering into agreement

of sale, it was specifically mentioned that in view of payment of substantial

amount of sale consideration, the vendor inducted the purchaser into possession

by virtue of the agreement of sale. Thus, the possession of the petitioner was

not as a tenant, but as a purchaser by virtue of payment of substantial amount of

sale consideration. The execution of conveyance deed after payment of the

balance sale consideration was a mere formality. As such, the document

marked under Ex.A1 evidencing delivery of possession of the property requires

stamp duty as per Explanation (I) of Article 47-A of Schedule 1-A of Indian

Stamp Act, 1889.

38. As such, this Court does not find any illegality or material irregularity in

the order and decree of the learned Principal District Judge, Hanumakonda in

de-exhibiting the document marked as Ex.A1 and in impounding the said

document giving a liberty to the plaintiff to get the said document of agreement

of sale marked on paying deficit stamp duty and penalty as required under

Article 47-A of Schedule 1-A of the Indian Stamp Act, 1889.

39. In the result, the Civil Revision Petition is dismissed confirming the order

of the Principal District Judge, Hanumakonda in I.A.No.630 of 2023 in

O.S.No.188 of 2022 dated 15.06.2023. No order as to costs.

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As a sequel, miscellaneous applications pending in this Revision Petition,

if any, shall stand closed.

____________________ Dr. G.RADHA RANI, J Date: 09th October, 2023 Nsk.