Uttarakhand High Court
State Of Uttarakhand And Another ... vs M/S Kailash Rosin Factory And ... on 4 March, 2021
HIGH COURT OF UTTARAKHAND AT NAINITAL
Second Appeal No. 61 of 2005
State of Uttarakhand and another .....Defendant/Appellants.
Versus
M/s Kailash Rosin Factory and others ....Plaintiff /Respondents
Present :
Mr. I.P. Kohli and Mr. Suyash Pant, Standing Counsel for the State of
Uttarakhand/appellants.
Dated: 4th March, 2021
JUDGEMENT
Hon'ble Sharad Kumar Sharma, J.
This is a defendants' Second Appeal, where a challenge
has been given to the judgment and decree dated 15th December,
2004, as was passed by the District Judge, Pauri Garhwal in Civil
Appeal No. 4 of 2002, as well as, against the judgment and decree
dated 29th November, 2001, as was passed by the Court of Civil Judge
(Senior Division), Pauri Garhwal, in Original Suit No. 36 of 1999,
M/s Kailash Rosin Factory, Partnership Firm Muni-Ki-Reti Vs. State
of U.P. and others.
2. By virtue of the judgments impugned, the issue which
stood adjudicated was as against the appellants/State, it was an issue
pertaining to the levying of the stamp duty on the conveyance of resin,
under a contract, which was made in favour of the
plaintiff/respondent.
3. Another issue, which was also agitated was pertaining to
the impact of non compliance of the provisions contained under
Section 80 of the C.P.C. As a result thereto, the Suit, the
interpretation given was that the Suit instituted by the
plaintiff/respondent, being Suit No. 36 of 1999, stood adjudicated by
partially decreeing the suit and confining the recovery to the extent of
Rs.62,906.80 paise, as it has been observed by the Trial Court's
judgment in its para 32, which is referred to hereunder :-
"oknh }kjk izfroknhx.k ds fo:} /ku dh olwyh gsrq lafLFkr ;g okn
dsoy :i;k 62]906-80 iS0 dh clwyh gsrq lO;; fMdzh fd;k tkrk gSA izfroknh
x.k dks vknsf"kr fd;k tkrk gS fd os oknh QeZ dks :i;k 62]906-80 iS0 3 ekg
ds Hkhrj vnk djsaA"
4. This judgement, on being given a challenge in an Appeal,
being Civil Appeal No. 4 of 2002, by the appellant, herein, has been
affirmed with a partial modification of the decree of the Trial Court in
the following manner :
"vihykUV dh vihy fujLr dh tkrh gS A fjLiksMsUV dh foijhr
vkifRr e; okn O;; Lohdkj dh tkrh gSA fo}ku flfoy tt (cfj.B) Js.kh
ikSMh x<oky ds fu.kZ; fnuakfdr 29-11-2001 la"kksf/kr fd;k tkrk gS vkSj oknh
/fjLiksMsUV dk okn vadu 86]495-00 e; ckn O;; fMdzh fd;k tkrk gSA bl
/kujkf"k ij oknh okn nk;j djus dh rkjh[k ls 9 izfr"kr okf'kZd lk/kkj.k
C;kt Hkh Hkqxrku dh frfFk rd ikus dk vf/kdkjh gksxkA"
5. Being aggrieved against the aforesaid judgments, the
Second Appeal was preferred by the defendant/appellant before this
Court on 2nd September, 2005. The Coordinate Bench of this Court,
while admitting the Appeal vide its order dated 5th September, 2005,
had formulated the following substantial questions of law which was
called upon to be answered by this Court :
"1. Whether, the stamp duty was payable under the
provisions of the Indian Stamp Act, 1899 on conveyance for
sale of resin in question ?
2. Whether, suit was bad in law in the absence of notice
under Section 80 of the Code of Civil Procedure, 1908 ?"
6. Despite of due service of notice on the plaintiff /
respondents, when they have not put in appearance in the Second
Appeal, hence, this Court by an order dated 25th February, 2021, had
directed the Second Appeal to proceed ex parte, and it was directed to
be posted for an ex parte hearing. Hence, the matter is listed today.
None appears for the plaintiff/respondents, even today, nor the order
dated 25th February, 2021, directing to proceed ex parte against them
have been sought to be recalled, by any one by filing any application,
for the said prayer. Hence, this Court has got no other option except
to hear the learned counsel for the appellants.
7. In answer to the first substantial question of law, which
has been framed, to the effect, as to whether the provisions of the
Stamp Act, 1899, would be applicable on the sale of resin, in question,
and whether the said sale would be treated as to be the conveyance or
not ?, in order to levy stamp duty on such sale of rosin.
8. The learned counsel for the appellants had drawn
attention of this Court, that the said aspect and the issue, about the
legal requirement of the imposition of the stamp duty on the sale of
resin, whether it amounts to be a conveyance or not has already been
settled by the Division Bench of Allahabad High Court in a judgment,
which was rendered and reported in 1999 (3) A.W.C. 2291, Bhatt
Industries and others Vs. Divisional Forest Officer, Almora and
others, wherein, the Division Bench in its reasoning assigned from
para 4 to 10, had upheld the applicability of the proviso to Section 3
(bb), and the exemption granted, to the State Government, to pay the
stamp duty from the liability to pay the stamp duty, was not extended
to be made applicable on the sale made of resin and the said issue was
decided in favour of the State, and particularly, a reference may be
had to para 8, 9 and 10 of the said judgment, which is referred to
hereunder :-
"8. There is one difference in the earlier and the
subsequent notification. The earlier notification grants
exemption in respect of all instruments mentioned therein and
the subsequent notification grants only if the value is less than
five thousand rupees. The instrument in question is more than
five thousand rupees but does the limit of five thousand rupees
apply to the specific six specific contract/agreement mentioned
in the second part or to the all instruments. In case it applies to
all, then all instruments will be liable to stamp duty if the value
is more than five thousand rupees. In case it applies to the six
specific contract/agreement in the second part, then the
instruments falling in the first part will be exempt from stamp
duty irrespective of their value. And the six specific contract/
agreement in second part will be exempt from stamp duty only
if the value is less than five thousand rupees. The relevant part
of the subsequent notification granting exemption is as follows :
"11. Instruments in the nature of a conveyance on
behalf of the State of standing trees or any other forest
produce in a Government forest ; and also the following
instruments where the amount or value specified therein
does not exceed five thousand rupees :
(i) Contract for collection of minor produce, barks,
etc.
(ii) Contract for selling and removing trees ;
(iii) Contract for the purchase of timber or
firewood to be felled or cut departmentally ;
(iv) Contract of the usufruct of trees and topes ;
(v) Contract for the felling or cutting and purchase
of timber or firewood ; and
(vi) Agreement for felling and conversion of
timber.
9. It is true that the use of the semi-colon after words
Government Forest and before the words "and also" indicate
that there is break in the two categories and the limit of Rs.
5,000 applies to the second category and not to the first
category. But 'no doubt grammar is a good guide but a bad
master to dictate. Notwithstanding the traditional view that
grammatical construction is the golden rule, justice Frankfurter
used words of practical wisdom when he observed, "There is no
other way to misread a document than read it literally". We do
not wish to commit the same mistake.
10. It appears that there could be some doubt if the six
specific instruments mentioned in the second category were
already included in the first category or not. It is for this reason
that in the earlier notification, they were specifically mentioned
as a second category with the use of a semi-colon and the words
'and also' which gives an inclusive definition to the first
category. When the subsequent notification was issued, the
intention was that limit of Rs. 5.000 should apply to the entire
item No. 11. But the semi-colon continued as it was in earlier
notification. Nothing turns upon it. If this was so, then we see
no reason why the limit of Rs. 5,000 will not apply to the
instruments mentioned in the first category. The State will do
well to remove the ambiguity. In view of the fact that we have
these points in favour of the State, the 4th point does not arise
for consideration."
9. The learned counsel for the appellants had further drawn
attention of this Court to an identical issue about the applicability of
the Stamp Act, on the sale of resin made by the appellants/State, had
come up for consideration before the Division Bench of this Court in
Writ Petition No. 1304 of 2001 (M/B), Jai Bharat Rosin and
Chemical Products Vs. State of U.P. and others, which was also
decided by the Division Bench of this Court vide its judgment dated
13th April, 2004, and it too was based on the ratio, as it has been laid
down by the Division Bench of Allahabad High Court as referred
above, the following conclusion was drawn by the Division Bench,
holding thereof that the stamp duty and the liability to pay stamp on
sale of resin would be levied on the sale of resin, which is made by the
State and a following conclusion was drawn :
"So far as the question of payment of stamp duty on the
instrument of sale of rosin by auction is concerned, the
controversy has been decided by the Division Bench of
Allahabad High Court in Writ Petition No. 23889 of 1988, M/s
Bhatt Industries, Damodhara, District Almora & others Vs. The
Divisional Forest Officer, Almora & others, in which the
Division Bench has said that the Notification of 1942 has been
withdrawn and the instrument in question is conveyance within
the meaning of Section 2 (10) of the Act. The stamp duty on it
is payable in view of Section 3 read with entry 23 schedule 1-B
of the Act. Earlier the stamp duty was not being charged due to
the exemption granted by Notification of 1942. By withdrawal
of exemption of 1942, the stamp duty is now payable.
Therefore, the controversy raised in respect of payment of
stamp duty on the instrument of sale of Rosin by the
Government either by way of allotment or by way of auction
has been settled that it is payable. We have not been
successfully persuaded to take any different view.
Therefore, in view of the Division Bench judgment of the
Allahabad High Court referred to above, the petitioner was
liable to pay the stamp duty. Petitioner did not pay the stamp
duty, which was being demanded by the Department and did
not lift the Rosin as he was not able to pay the stamp duty
within the time, therefore, the Divisional Forest Officer has
cancelled the allotment.
In view of this, the reasons for cancellation of allotment
are valid. We do not find any infirmity in the cancellation order
dated 31st October, 2001.
Therefore, all the writ petitions are devoid of merit and
are, hereby, dismissed. However, it is open for the petitioners
to participate in any auction, which is being held for the
allotment of Rosin."
10. Since none has appeared on behalf of the respondents to
assist the Court and to controvert the aforesaid stand about the impact
of the aforesaid two judgments of the Division Bench, whereby, it has
been consistently held that the provisions of Stamp Act 1899, would
be applicable on the conveyance of sale of resin, hence, the question
No.1, pertaining to the applicability of the Act, and levying of the
stamp duty on a sale of resin, is hereby held to be a conveyance and
the stamp duty would be payable on it, as per the schedule contained
under the Stamp Act. Accordingly, the said question is answered in
favour of the present appellant.
11. Referring to the second substantial question of law with
regard to the impact of issuance of notice under Section 80 of the
CPC, which was formulated at the time of admission of the Second
Appeal, a reference to Section 80 of the CPC, itself becomes
inevitable to appropriately answer the said issue, as to what is the
purpose behind it. Section 80 of the CPC is quoted hereunder :-
"80. Notice - [(1)] [Save as otherwise provided in sub-
section (2), no suit shall be instituted] against the Government
(including the Government of the State of Jammu and Kashmir)
or against a public officer in respect of any act purporting to be
done by such public officer in his official capacity, until the
expiration of two months next after notice in writing has been
delivered to, or left at the office of -
(a) in the case of a suit against the Central Government,
[except where it relates to a railway], a Secretary to that
Government;
[(b)] in the case of a suit against the Central Government
where it relates to railway, the General Manager of that
railway;]
(b) [***]
[(bb) in the case of a suit against the Government of the
State of Jammu and Kashmir, the Chief Secretary to that
Government or any other officer authorised by that Government
in this behalf;]
(c) in the case of suit against [any other State
Government], a Secretary to that Government or the Collector
of the district;
(d) [***]
and, in the case of a public officer, delivered to him or left at his
office, stating the cause of action, the name, description and
place of residence of the plaintiff and the relief which he
claims; and the plaint shall contain a statement that such notice
has been so delivered or left.
[(2) A suit to obtain an urgent or immediate relief against
the Government (including the Government of the State of
Jammu and Kashmir) or any public officer in respect of any act
purporting to be done by such public officer in his official
capacity, may be instituted, with the leave of the Court, without
serving any notice as required by sub-section (1); but the Court
shall not grant relief in the suit, whether interim or otherwise,
except after giving to the Government or public officer, as the
case may be, a reasonable opportunity of showing cause in
respect of the relief prayed for in the suit:
Provided that the Court shall, if it is satisfied, after
hearing the parties, that no urgent or immediate relief need be
granted in the suit, return the plaint for presentation to it after
complying with the requirements of sub-section (1).
(3) No suit instituted against the Government or against a
public officer in respect of any act purporting to be done by
such public officer in his official capacity shall be dismissed
merely by reason of any error or defect in the notice referred to
in sub-section (1), if in such notice--
(a) the name, description and the residence of the
plaintiff had been so given as to enable the appropriate
authority or the public officer to identify the person
serving the notice and such notice has been delivered or
left at the office of the appropriate authority in sub-
section (1), and
(b) the cause of action and the relief claimed by
the plaintiff had been substantially indicated.]"
12. As per the opinion of this Court, the bar, which was
created by the said provision was with regard to the restriction
imposed on the plaintiffs for the institution of the Suit as against the
Government or against the Public Officer, acting on behalf of the
State Government, and as to whether in the absence of the same,
whether the proceedings would be vitiated. For the said purposes, a
reference may be had to the plaint averments, as instituted by the
respondents in para 11, which is quoted hereunder :-
"11. That when even after the service of legal notice
dated 14-8-97, the amount excessively charged by the
Prabhagiya Van Garhwal Van Prabhag Pauri was not
refunded, a notice dated 3-10-98 U/s 80 C.P.C. was served
upon the defendant calling upon the defendant to pay a sum
of Rs.86,495/- which included interest up till 30-9-98 to the
plaintiff within two months from the date of service of notice,
failing which on the expiry of the period of notice, the
defendant was informed that the plaintiff would be forced to
file a suit against the State of U.P. for recovery of sum of
Rs.86495/- along with pendente lite and further interest @ 18%
per annum till the amount is paid to the plaintiff at the cost,
risk, and responsibility of the defendant. The cause of action
accrued in favour of the plaintiff was also informed to the
defendant."
13. In para 11, the plaintiff himself has made a reference to
the legal notice of 14th August, 1997, which was served upon the
Divisional Forest Officer of the Division, as referred therein, and
hence, the provisions of Section 80 of the CPC, as per the averments
made in plaint, since stood complied with, the said question of
compliance of Section 80 CPC, as referred therein, and in the written
statement too itself is taken into consideration, in para 11, a very
evasive reply has been given, denying the fact of having received the
notice under Section 80 of the C.P.C.
14. Be that as it may. Looking to the circumstances and the
reasoning, which has been assigned by the learned Trial Court, while
adjudicating upon the liability, fixed for the remittance of the stamp
duty on the conveyance of resin made in favour of the
plaintiff/respondent, in fact, if the issues which has been framed by
the Trial Court, itself are taken into consideration, the
plaintiff/respondent had never attempted to get the said issue
answered, particularly, that as of issue No. 2, which refers to a notice
but not specifically referring the notice contemplated under Section 80
of the C.P.C. and the finding has been recorded to the contrary against
the plaintiff / respondent, which was later on also affirmed by the
learned Appellate Court, which was never challenged by
plaintiff/respondent.
15. Since the effect of Section 80 of the CPC, was not a
question, which was specifically addressed upon for the reason being
that the said issue No. 2, which was formulated was decided as a
preliminary issue, as against the plaintiff/respondent, and it has been
concurrently upheld by the Appellate Court also. Apart from it, the
argument of the learned counsel for the appellant is that the said
decision of 11th April, 2000, which constituted to be the part of the
judgment of 29th November, 2001, which was rendered by the Trial
Court has not been specifically put to challenge in view of the
provisions contained under Section 105 of the CPC. The said
question of non compliance of Section 80 of the CPC, would not arise
to be decided by way of a substantial question of law in the present
Second Appeal. Hence, the said question too is answered in favour
of the appellants.
16. Consequently, the Second Appeal is allowed. The
impugned judgments are hereby quashed.
(Sharad Kumar Sharma, J.)
04.03.2021
Shiv
