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Rajendra Narayan Singh Deo Vs. State of Orissa - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtOrissa High Court
Decided On
Case NumberCivil Reference No. 1 of 1962
Judge
Reported inAIR1966Ori214
ActsStamp Act, 1899 - Sections 33, 33(1) and 57(1); Orissa Private Lands of Rulers (Assessment of Rent) Act, 1958 - Sections 2 and 5; Income Tax Act, 1961 - Sections 256(1)
AppellantRajendra Narayan Singh Deo
RespondentState of Orissa
Appellant AdvocateR.N. Misra, Adv.
Respondent AdvocateAdv. General
Cases ReferredGum Estate v. Commr. of Income Tax.
Excerpt:
.....revenue while referring the case to us has clearly stated that it was on 21-9-61 that the original revenue proceeding was closed. as already said, once it is found that the original revenue proceeding was closed and the final orders were passed on 21-9-61, the order impounding the document on 15-1-62 is clearly beyond jurisdiction and the order was passed at a time when the court was functus officio. this case is clearly distinguishable there the inspector of stamps while inspecting the recordsin the record room of the district, noticed that an award and the decree passed in terms of the award was not duly stamped and sent report to that effect to the chief inspector of stamps and copy thereof to the district judge the report was sent to the district judge as the person in charge of the..........mr. misrat learned counsel appearing on behalf of the petitioner contended that the original revenue proceeding having been completed on 21-9-61, the additional collector had no jurisdiction to impound the document on 15-1-62 as he was then fund us officio in respect of the original case where the document was produced. in support of his contention he relied upon a number of decisions which i shall presently deal.7. in a case reported in air 1942 lah 257 (fb), puran chancl v. emperor, the lahore high court was dealing with a case where the facts were as follows :in a suit the defendant filed two receipts. a and b. a was attached to the written statement, but was not tendered or produced in evidence during the trial, the court made an endorsement on a ' returned. not proved. ' but.....
Judgment:

Das, J.

1. This is a reference made under Section 57 of the Indian Stamp Act (hereinafter mentioned as 'the Act') by the Member, Board of Revenue. Orissa, as the Chief Revenue Administrative authority in the State The reference arises under the following circumstances :

2. The petitioner Maharaja Shri R.N. Singh Deo is the Ruler of the ex-State of Bolangir which was merged in the State of Orissa by the well known Merger Agreement of 1947 and the administration of the said State was taken over by the Government of Orissa on 1-1-1948 In the year 1958 an Act was passed known as 'The Orissa Private Lands of Rulers (Assessment of Rent) Act XIII of 1958 (hereinafter mentioned as 'the Orissa Act') The object of this Act is to make provision for theassessment of rent in respect of the private lands of the Rulers in the State of Orissa. Under the provisions of the said Act, a proceeding (Miscellaneous Case No. 27/59) was started by the Additional Collector, Bolangir, as a Revenue Officer of the District for assessment of the private lands of the petitioners. In accordance with the provisions of the said Orissa Act, a draft or preliminary patta was prepared and the petitioner was asked why it should not be made final.

While contesting the patta an objection was filed on behalf of the petitioner saying that a particular property was not liable to assessment as it has been transferred to one of his minor sons. In support of such a claim a document purporting to be a sale-deed was filed on 15-12-59. It was scribed on plain unstamped paper and the consideration was shown to be one lakh of rupees. It was shown to have been executed on 20-3-1959. The additional Collector thought that the document was not duly stamped and on 20-5-1961, started a separate miscellaneous proceeding (Miscellaneous case 28/1-1961-62) for impounding the document under Section 33 of the Indian Stamp Act and in the proceeding called upon the vendee to show cause why the document shall not be impounded for non-payment of stamp duly.

In the meantime he proceeded with the original assessment proceeding and passed the final orders on 21-9-1961 in the said proceeding On 15 1-1962, the Additional Collector passed an order in the aforesaid Miscellaneous Case (28/1-62) that he impounded the document and forwarded the same to the Collector in accordance with the provisions of Section 38(2) of the Act. After receipt of the document, the Collector of Bolangir in exercise of the powers under section 40 of the Act directed to petitioner by order dated 17-3-63 to pay a sum of Rs. 2-250 as the proper duty payable on the document and a penalty of Rs. 9,000. As against this order of the Collector, a revision petition (Revenue Case No. 75/62) was filed by the petitioner before the member. Board of Revenue

3. Several contentions were raised on behalf of the petitioner before the Member, Board of Revenue, such as that the document being merely a draft sale-deed is not liable to stamp duty and that the original assessment proceeding in which the said document was produced having been completed on 21-9-61 Court has no jurisdiction to impound the document on 15-1-1962 in the other miscellaneous proceeding as by then he became functus officio in relation to the main proceedings.

4. On behalf of the Stale it was urged that the document represented a completed transaction of sale and as such it is liable to the requisite stamp duty and has been rightly impounded With respect to the other contention it was urged on behalf of the State that the date of impounding the document shall be deemed to be 15-12-1959 when the same was produced before the Court and taken into custody by such Court in the original proceeding and as such it was impounded before the case was closed; and in that view of the matter the question that the Court was then functus officio cannot arise.

5. The learned Member of the Board of Revenue negatived the first contention raised on behalf of the petitioner that it was a draft sale-deed, but found that the document is a ' sale-deed ' and as such it is liable to be impounded. In respect of the other contention he gave the finding that the case in which the impugned document was presented was completed on 21-9-1961 and the document was impounded on a later date, that is, on 15-1-62 in the other miscellaneous proceeding. In view of some decisions cited before him, he also was of the opinion that if there was no miscellaneous case, any impounding after 21-9-1961 would have been improper as the Court had be come functus officio.

He, however, entertained some doubt as to the legal position when a separate miscellaneous case which an off-shool of the parent case is started and orders impounding the document is passer] in the said case after disposal of the original case where the document was first produced. He therefore, referred the following question to this Court under section 57 of the Act :

' Whether a Court during the course of proceeding before it finds a document fit to be impounded under Section 33 of the Indian Stamp Act, starts a miscellaneous case for this purpose, and particularly for giving a chance to the party concerned to explain the matter, can continue to have jurisdiction after the original case is concluded on the ground that the miscellaneous case has been started while the original case was pending. '

6. The relevant and undisputed facts are that the document was produced before the Additional Collector on 15-12-1959 in the main proceeding (Case No. 27 of 1959-60) and on 20-5-1961 he considered it necessary to impound the document under Section 33 of the Act- and for that purpose started a separate miscellaneous case No. 28/1 of 1961-62 on that very date. As under Section 29(c) of the Act the vendee is liable to pay the deficit stamp duty he was called upon to show cause why the document should not be impounded for non-payment of proper stamp duty. At the instance of the state, a similar notice was issued to the petitioner as it was at his instance that the document was produced. The original proceeding as found by the Member, Board of Revenue was completed on 21-9-1961,

Some months thereafter by an order dated 15-1-62 passed in the aforesaid miscellaneous proceedings, the Additional Collector impounded the document and submitted the same under Section 38(2) before the Collector. Mr. Misrat learned counsel appearing on behalf of the petitioner contended that the original revenue proceeding having been completed on 21-9-61, the Additional Collector had no jurisdiction to impound the document on 15-1-62 as he was then fund us officio in respect of the original case where the document was produced. In support of his contention he relied upon a number of decisions which I shall presently deal.

7. In a case reported in AIR 1942 Lah 257 (FB), Puran Chancl v. Emperor, the Lahore High Court was dealing with a case where the facts were as follows :

In a suit the defendant filed two receipts. A and B. A was attached to the written statement, but was not tendered or produced in evidence During the trial, the Court made an endorsement on A ' Returned. Not proved. ' But the document remained on record. This was on 10-6-1938. The Court pronounced its judgment on 30th August 1938 and gave an oral direction that the receipt A be impounded. But by mistake the endorsement was made on receipt B and signed by the sub-Judge on 30-8-38. On the following day it was sent to the Collector as provided under Section 38 of the Stamp Act. Therefore the Collector signed an order to the effect that as the right document has not been impounded by the subordinate Judge, no action could be taken by the Collector on receipt B and the same was returned. On 3-4-1939 the subordinate Judge wrote an endorsement on receipt A that the document was impounded, and then forwarded the same to the Collector, who called upon the defendant to pay the deficit stamp and the profits. The defendant took this matter before the Chief Controlling revenue authority who made a reference to the High Court under section 57(1) of the Act. Several questions were referred to the High Court.

In the present reference, we are however, concerned with two of such question (questions Nos. 1 and 2) which were as follows:

' (1) If the Civil Court intending to impound Ext. A signs an endorsement of impound ing on the back of the Ext B, can the oral direction to impound. A be held to be impounding of the document ?

(2) If not, can an endorsement of impounding on the back of document A at a date when the case has been finished serve to rectify the original endorsement?'

With respect of the first question, the Court held that, the impounding of a document should be held to take place not when verbal order was given by the Court, but when it was carried out that is, when the document was taken into custody by the Court and an endorsement was made thereon. Consequently although the Court intended to impound receipt A. the effect of the actual endorsement signed by it on receipt B was to impound receipt B. Therefore, the receipt A was not impounded at all.

With respect to the second question their Lordships held that the trial having been finished on the 30th of August 1938, the endorsement on receipt A made on 3-4-39 did not rectify the original error as the Court was clearly functus officio and therefore, had no power to impound a document.

8. In a case reported in AIR 1949 Nag 214 Paiku Kashinath v. Gaya, the learned Judge held that the Court has no jurisdiction to reopen a case to impound a document after the decree is signed That was a case where the judgment was delivered by the Civil Judge on 13-2-43, but the document was impounded on 27-7-45.

9. The Madhya Pradesh High Court in a case reported in AIR 1957 Madh Pra 206. Hira-lal v. Jagmohandas also took a similar view. It was held that after the judgment was delivered, the Court became functus officio and therefore, he was not competent to reopen the matter to impound the document.

10. A Full Bench of the Bombay High Court in a case reported in AIR 1930 Bom 392 (FB). also took a similar view. It was a case where a sale-certificate granted to the purchaser by the Court had on it only four annas stamp though it should have borne a stamp of eight annas A copy of the certificate was sent to the sub-Registrar who informed the Court that it was insufficiently stamped The Judge got the certificate back from the purchaser thinking that he had power to receive back the same. He then imposed a penalty and asked for the opinion of the High Court. In the above circumstances, it was held that as the judge when the certificate was presented to him for the second time, was functus officio he could not impound it under Section 33(1) of the Act.

11. The same view was also taken by the Calcutta High Court in a case reported in AIR 1927 Cal 472. Khetramohan v. Jamini Kanta.

12. The Patna High Court in a case reported in AIR 1947 Pat 443 Inderman Mahton v. Thakur Mahton. also look the view that the court cannot impound a document under the Stamp Act after it became functus officio.

13. Similar is also the view expressed by the Madras High Court as would appear from the decision in (1885) ILR 8 Mad 564 (FB), though no doubt the farts an somewhat different

14. In this connection I may refer to a decision of the Supreme Court reported in AIR 1961 SC 787, Govt. of Uttar Pradesh v Mohd. Amir That was a case where the respondent having some doubt as to the stamp to be affixed on a wakf-deed presented the same before the Collector under Section 31 for adjudication as to the proper stamp duty chargeable on that document As the Collector himself was in doubt he referred the matter to the Board of Revenue which held that the document was liable to duty Under Section 58 of the Act The Collector ordered the amount to be deposited within 15 days The document was impounded Under Section 33 of the Act and the respondent was also called upon to pay a penalty within a specified period.

The respondent filed a petition under Article 226 of the Constitution. A Full Bench of the High Court of Allahabad case reported in AIR 1956 AH 453 (FB) quashed the order of the Collector On appeal by the Goverment of U. P. their Lordships held that the purpose ofproduction of the document before the Collector was to determine the duty payable under the same and as soon as the Collector determined the duty he became functus officio and he could not impound the instrument under Section 33 and consequent proceedings could not therefore be taken Their Lordships referred to the aforesaid decisions reported in AIR 1949 Nag 214 and AIR 1930 Bom 392 (FB).

15. The authorities cited above have clearly laid down the law that once the court has become functus officio in respect of a case before him he cannoi act subsequently under Section 33 of the Act. to pass an order impounding the document Thus the order of impounding having been passed on 15-1-1962 long after 30-9-61 when the case was completed, the court will have no jurisdiction to act under Section 33 as by then the original proceeding (case No. 27 of 1959) where the document was produced was over and the Court has become functus officio in relation to that case

The matter, however, does not rest there. As clearly seen on 20-5-61 the Additional Collector tor started a separate proceeding (Miscellaneous Case No. 23/1 of 1961-62) for impounding the document under Section 33. It is not understood why a separate proceeding was started for the purpose- nor does the Stamp Act or the Rules made thereunder enjoin on the Court to start a separate proceeding for the purpose The question is if there is any change in the legal position by starting a separate proceeding for impounding the document under Section 33 At this stage it is necessary to refer to the provision of Section 33 of the Act which are as follows:

' Every person having by law or consent of parties authority to receive evidence, and every person in charge of a public office, except an officer of police, before whom any instrument chargeable in his opinion, with duty, is produced or comes in the performance of his functions, shall if it appears to him that such instrument is not duly stamped, impound the same Sub-section (2) says. ' For that purpose every such person shall examine every instrument so chargeable and so produced or coming before him in order to ascertain whether it is stamped with a stamp of the value and description required by the law in force in India when such instrument was executed or first executed Provided that ..... '

The Supreme Court in the aforesaid case in AFR 1961 SC 787 while dealing with the import of Section 33 has said that the words 'Every person having by law or consent of parties authority .. ... . before whom any instrument isproduced or comes in the performance of his function' refers firstly to the production before judicial or other officers performing judicial functions as evidence of any fact to be proved and secondly it refers to other officers who have to perform any function in regard to those instruments when they come before them e.g.. registration In the present case the production of the document in question clearly refers tothe first part, as it was produced before the Court of the Addl. Collector in case No. 27 of 1957 by way of evidence in support of the claim of the petitioner that he is not liable to assessment under the Orissa Act as in respect of certain property on the ground that it was sold to one of his sons The Document was never produced nor did it come in the performance of the functions before the Additional Collector in any other capacity for any other purpose.

The learned Advocate General urged that the 1st part of Section 33(d) shall not be applicable to the case as the Additional Collector was not acting as a Court but the second part of the said section will apply to the case. This contention has no force. It will be seen from the question under reference that the Member. Board of Revenue, has treated the Additional Collector as a Court for the purpose of this case. There is also no doubt about the fad that the document was produced before the Additional Collector who is authorised to receive evidence and that it was produced in proof of the fact that the petitioner had transferred his interest in certain property covered by the document. Thus, there cannot be any doubt that it was produced before the officer performing a judicial function in case No. 27/59

In that proceeding it was open to the Additional Collector to take action under Section 33 He however chose to start a separate proceeding during the pendency of the original case and took action under Section 33. I have already said that a separate proceeding was not required to be started for taking action under Section 33 It may therefore be taken as a part of the original proceeding in which event the order passed in the miscellaneous case shall be treated as an order passed in the original case. As a separate proceeding, as already said it has no legal existence, and assuming it is a separate proceeding no action could be taken for the purpose of Section 33 as the impugned document was not produced in the same For the purpose of this case it makes no difference whether a separate proceeding is started or not. the relevant question being when was the document impounded

16. The learned Advocate General next contended that the 'document was impounded on the very day it was produced before the Additional Collector, that is on 15-12-59 as it was on that date document came to the custody of the Court and remained since then in. his custody The word 'impound' has not been defined in the Stamp Act. The mere fact that the document was produced in the Court on 15 12-1959 cannot, by itself, be taken to be the date for the purpose of impounding under Section 33. We have already seen that the Special Bench of the Lahore High Court in AIR 1942 Lah 257 (SB) had answered (question No. 1) on the point. It was held that the 'impounding' of a document should be held to take place when the order of the Court is carried out that is when the document was taken into thecustody of the Court and an endorsement was made thereon.

It will appear from the alleged sale-deed before us that such an endorsement has been made on 16-1-1962 and not on any other date prior to that. The document shall, for the purpose of Section 33, be therefore held to have been impounded on 15-1-52, that is, several months after the completion of the original case which took place on 20-9-61. The order dated 15-1-62 must, therefore, be held to be without jurisdiction and passed at a time when the court was fund as officio

17. The learned Advocate General next urged that the original revenue proceeding was closed on 4-4-62 and not on 21-9-61 and as such the order dated 15-1-62 was passed before the case itself was closed and as such the revenue officer was not functus officio when he passed the order. This contention also has no force.

18. The learned Member of the Board of Revenue while referring the case to us has clearly stated that it was on 21-9-61 that the original revenue proceeding was closed. In fact it was on that footing that this Reference has been made otherwise in view of the decisions cited before him and the view he has taken, there was no necessity for this Reference to be made to this Court, the order dated 21-9-1961 makes the position absolutely clear It runs as follows:

'21-9-61 : A. M. to the Objector present: Order Passed--Put up on 25-10-1961 after expiry of the appeal period '

No doubt, after this date proceedings were taken for preparation of final patta and the records were closed on 4-4-62. But the proceedings after 21-9-61 are of a mechanical and administrative character. After 21-9-61 the case was adjourned to several dates for preparation and lapse of final patta to the assessee. But so far as the decision of the case itself is concerned, it was disposed of finally on 21-9-61 when the order was passed. In fact, the Board of Revenue has noticed that. It does not appear that the learned Advocate General who argued the case before the Board raised this contention before him.

In any event, it is not open to us in a Reference of this nature to go behind the facts as stated by referring authority see AIR 1963 S. C. 1452. Gum Estate v. Commr. of Income Tax. B and O. As already said, once it is found that the original revenue proceeding was closed and the final orders were passed on 21-9-61, the order impounding the document on 15-1-62 is clearly beyond jurisdiction and the order was passed at a time when the Court was functus officio.

19. The learned Advocate General however, relied upon a decision reported in (S) MB 1955 All 615 Ananda Narahi v District Judge Faizabad, in support of his contention that the document could be impounded even after the disposal of the case. This case is clearly distinguishable There the Inspector of Stamps while inspecting the recordsin the record room of the District, noticed that an award and the decree passed in terms of the award was not duly stamped and sent report to that effect to the Chief Inspector of Stamps and copy thereof to the District Judge The report was sent to the District Judge as the person in charge of the record room under Rule 330 of the U.P. Stamp Rules, 1942. That rule gives an option to the court or the head of the office to hear the party and to impound a document. This, however, is no authority for the proposition of law now before us.

20. In view of the legal position the question must be answered in the negative, that is the court cannot after the original case is concluded continue to have jurisdiction to impound the document, under Section 33 on the ground that during the pendency of the original proceeding a miscellaneous case was started to impound the same under Section 33 of the Act.

The State shall pay a sum of Rs. 100/-(Rupees one hundred only) to the petitioner as the hearing fee of this Reference.

Ahmad, C.J.

21. I agree

Barman, J.

22. I agree.


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