Rajindar Sachar, J.
(1) This is a reference under Section 57(1) of the Indian Stamp Act, 1899 (hereinafter to be called the Act) made by the Chief Controlling Revenue Authority, Delhi.
(2) A partition deed was executed between Shri O. N. Talwar, petitioner. on his own behalf and as natural guardian of his minor sons, Shri Rai Talwar and Shri Ranjiv Talwar of the first part and Shrimati Kanta Talwar wife of Shri O. N. Talwar of the second part on 26.7.1966. With this partition deed was attached a schedule to form part of the deed in which total assets were shown as Rs. 7,68.239-64. The amount of respective liabilities to he discharged by the erstwhile members of the family were shown as Rs. 4,07,115-09 leaving a net divisible asset of Rs. 3,61,124-55. The same was divided amongst the lour members in equal shares of Rs. 90,281-14. In the body of the deed it was stated that whereas it was obligatory on the Hindu Undivided Family to make adequate provision for maintenance, education and p the celebration of the wedding of Kumari Rita Talwar before partition was effected and further whereas it was also obligatory to make provision to discharge other liabilities and whereas a net asset divisible amongst the parties to this deed stood reduced to Rs. 3,61 124-55 after providing for the discharge of all family liabilities, the value of the share of each of the parties to this deed is Rs. 90.281 -14. It was also stated that Shrimati Kanta Talwar as a part of her obligation is responsible for meeting all expenditure on maintenance, education and wedding of Kumari Rita Talwar. The said partition deed was presented for registration bearing the stamp of Rs.2,709.00. The Sub-registrar. Delhi, before whom it was presented, found that the stamp duty has been paid on the basis of net assets of Rs. 3,61,124-55 calculated after deducting Rs. 4.07,115-09 being the amount of liabilities to be discharged by the different members, though the total value of the assets partitioned is Rs. 7.68,239-64 which should bear the stamp of Rs. 4.640.00. According to him the stamp was deficient by Rs. 1,93 I.00 and he, thereforee impounded the deed by his order dated 27.9.1966 and sent it to the Collector for necessary action under Section 40 of the Act. The Collector of Stamps by his order dated 12.10.1966 issued notice to the petitioner requiring him to show cause, why he be not required to make payment of the deficiency and the penalty in accordance with Section 40 of the Act. Cause was shown by the petitioner vide his reply dated 24th October, 1966, and also on oral hearing before the Collector. The Collector, however, by his order dated 17.11.1966 found that the question whether the stamp duty has to be calculated on the future net assets or the present (gross) assets is not free from doubt and thereforee he referred the matter to the Chief Controlling Revenue Authority, Delhi, under Section 56(2) of the Act to enable the stamp duty to be calculated. The reference under Section 56(2) was heard by the Chief Controlling Revenue Authority who was of the view that this was an important case involving a question of interpretation of law and is likely to effect in future such cases, he considered it necessary to have doubts on this question resolved by a reference to the High Court under Section 57(1) of the Act. He, thereforee, submitted the following question for reference to this court :-
'in a case of a deed of partition of the property of a Hindu Undivided Family, is it permissible to deduct from the value of gross assets the value of the expenses on obligations of the family under the Hindu Law e.g; maintenance, education and marriage of un-married daughter etc. when the amounts on these future expenses have not been specifically mentioned in the deed and share then calculate stamp duty on the value of the 'separated share' of net assets under Article 45 of Schedule I-A of the Indian Stamp Act.'
(3) This is how the matter has been placed before us for disposal
IN the present case it is not disputed that if the value of the separated share or shares of the property is calculated on the assets of Rs. 3.61.- 124-55 then the stamp fixed by the petitioner was correct one, while if the value of the property-is taken as Rs. 7,68,239-64 the stamp fixed is deficient by Rs. l,931.00 .The Claim of the revenue is that as the total value of the assets which are being partitioned is Rs. 7,68.239.64 the duty payable on that will come to Rs. 4,640.00. The contention of Mr. Iyengar, learned counsel for the petitioner is that even though the gross assets are Rs. 7,68,239-64, he is not liable to pay stamp on the total but is only liable to pay the duty on the amount of the value of the separated share of the property which he says in this case amounts only to Rs. 3,61,124-55 as according to him he is entitled to claim the deduction of whole liability of Rs. 4.07,115-09 being the liability which has to be discharged by the Hindu Joint Family and cannot be included for the purpose of valuation.
(4) Section 2(11) of the Act defines the word 'duly stamped' as applied to an instrument, means that the instrument bears an adhesive or impressed stamp of not less than the proper amount and that such stamp has been affixed or used in accordance with the law for. the time being in force in India.
(5) Section 3 of the Act provides that subject to the provisions of the Act and the exemptions contained in Schedule 1. the instruments shall be chargeable with duty of the amount indicated in that Schedule as the proper duty thereforee.
(6) Reference to Schedule I, will show that the instrument of partition is contained in item 45 of this schedule. It is to bear the same duty as a Bond (No. 15) of the amount of the value of the separated share or shares of the property.
(7) Section 27 of the Act requires that the consideration (if any) and all other facts and circumstances affecting the chargeability of any instrument with duty, or the amount of the duty with which it is chargeable. shall be fully and truly set forth therein.
(8) Section 33 of the Act provides that every person in charge of a public office, if it appears to him that an instrument is not duly stamped, shall impound the same.
(9) Section 35 provides that 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.
(10) Section 38(2) of the Act requires the person impounding the instrument under Section 33 of the Act to send it to the Collector.
(11) Section 40 provides that when an instrument impounded under Section 38(2) is received by a Collector and if he is of the opinion that such instrument is duly stamped, he shall certify by endorsement thereon that it is duly stamped, or that if he is of the opinion that such instrument is chargeable with duty and is not duly stamped, he shall require the payment of the proper duty or the amount required to make up the same together with a penalty of amount not exceeding ten times the amount of the proper duty or of the deficient portion thereof.
(12) Section 64 provides that any person who with intent to defraud the Government executes any instrument in which all the facts and circumastancesrequired by Section 27 to be set forth in such instrument are not fully and truly set froth shall be punishable with fine which may extend to five thousand rupees.
(13) The scheme of the Act would thus show that for the purpose of stamp law the valuation given in the instrument would have to be accepted. If there was an intentional under-valuation then the prosecution would protect the government against the attempted fraud. As the Registrar has been given no power under the Act to hold an enquiry to find out about the market value, the value must be mentioned in the document itself. It is for this reason that Section 27 of the Act requires that facts and other circumstances must be fully and truly set forth therein. A further safeguard is provided that if the same have not been set forth as required by Section 27 and the omission is with intent to defraud the government the person is liable for prosecution under Section 64. This is one safeguard that is provided in the Stamp Act for deliberate and intentional under-valuation of the property being given by the executant of the deed.
(14) Section 35 also empowers the Registrar not to register the document unless the instrument is duly stamped. From this it is implicit that the Registrar can ask the person seeking registration to furnish the particulars required for the calculation of the duty payable and if from the particulars supplied the Registrar is of the opinion that there was deliberate under-valuation with intent to cheat the government it will be permissible for him to start proceedings under Section 27 of the Act read with Section 64. In this connection see In the Matter of Muhammad Muzafiar Ali, I.L.R 1922 All 339. The Joint Secretary, Board of Revenue, Madras v. K.R. Venkatarama Avyar : AIR1950Mad738 and In re. Venkatsawami Aiya : AIR1953Mad941 .
(15) The argument of Mr. Kishore. learned counsel for the respondent that as full details of the liabilities which are sought to be deducted from the total value of Rs. 7,68,239 '64 are not mentioned in the instrument of partition it is not a full compliance of Section 27 and thereforee the duty must be paid on the total value of Rs. 7,68,239-64, is not borne out by the scheme' of the Act. The penalty for not setting forth all the facts and circumstances fully and truly as required by Section 27 is only that if a person has done it with intent to defraud the government he is liable for prosecution. But non-compliance with Section 27 does not entail the consequences that even if a person is entitled to claim that various encumbrances be deducted from the total value of the property for the purpose of determining the stamp duty, he will be debarred from doing so because of the failure to give all these details under Section 27. This view is also supported if a reference is made to Section 31 of the Act. Section 31 provides that when any instrument, whether executed or not and whether previously stamped or not, is brought to the Collector and the person bringing Ji it applies to have the opinion of that officer as to the duty (if any) with which it is chargeable, the Collector shall determine the duty (if any) with which, in his judgment the instrument is chargeable. Sub-section (2) of Section 31 further empowers the Collector to require to be furnished with evidence as he may deem necessary to prove that all the facts and circumstances affecting the chargeability of the instrument with duty or the amount of the duty with which it is chargeable are fully and truly set forth and may refuse to proceed upon any such application until such abstract and evidence have been furnished accordingly. Proviso to this section further says that every person by whom any such evidence is furnished, shall, on payment of the full duty with which the instrument to which it relates, is chargeable, be relieved from any penalty which he may have incurred under the Act by reason of the omission to state truly in such instrument any of the facts or circumstances aforesaid.
(16) Section 32 empowers the collector to certify by endorsement on such instrument that the full duly with which it is chargeable has been paid and such an instrument upon which an endorsement has been made shall be deemed to be duly stamped or not chargeable with duty, as the case may be; and. if chargeable with duty, shall be receivable in evidence or otherwise and may be acted upon and registered as if it had been originally duly stamped.
(17) These provisions would, thereforee, show that even if in the first instance full facts as required by section 27 are not set forth in the instrument the same can be placed before the Collector for adjudication and evidence can be given before him to enable the Collector to determine what duty, if any, is payable on the instrument. These provisions will further support our view that the mere omission to state all the facts does not entail the consequence that a person is debarred from showing that there are liabilities which will reduce the total value of the property for the purpose of stamp duty.
(18) The Collector and the Chief Controlling Revenue Authority, how ever, seem to assume that the details of the various liabilities having not been mentioned specifically in the instrument the same can not be allowed for the purpose of calculating the stamp duty on the value of the separated share. A reference to the partition deed will show that the total of the liabilities of Rs. 4,07,115-09 finds mention there which has been deducted from the total assets of Rs. 7,68,- 239 64. Of course the various details constituting a total of Rs. 4,07,- 115-09 have not been specifically mentioned in the instrument of partition. It seems to us that the absence of details given in the instrument of partition will not make any mate rial difference for the purpose of calculating the duty payable by the Petitioner. Assume that in the instrument of partition, the petitioner had valued the property at only three lacs and when it was presented for registration, the Registrar feeling that it was not duly stamped was to require the petitioner to furnish the particulars to show as to what the true value of the property was. The petitioner could surely then have shown that though the value of the property was seven lacs they have mentioned the figure of three lacs because this was arrived at after deduction of liabilities of four lacs Similar would be the position when notice was issued to the petitioner by the Collector after the document had been impounded. Section 40 requires the Collector to certify on the instrument whether it is duly stamped or not. In order thereforee to find out the Collector would -necessarily enquire from the executant of the instrument as to how he has arrived at a particular value. In answer to that the petitioner could have supplied the details showing the various liabilities on account of which the full value of Rs. 7,68,239-64 has been reduced to Rs. 3.61.-124-55. If the Collector found that the absence of the mention of these liabilities in the instrument was with intent to defraud, he would order prosecution but if he found that there was no intention to defraud the government no prosecution would follow; and further if he accepted the Explanationn of the petitioner he would certify that the instrument was duly stamped, If that be the case when no mention of liabilities is made would it make any difference if the petitioner has given the total of gross liabilities, without specifying the various details which constitutes the total. In our opinion there is no logic why there should be any difference at all. No doubt it is true that Section 27 requires that all facts and circumstances affecting the chargeability of any instrument shall be fully and truly set forth therein. But it does not mean that if all the facts and circumstances as required by Section 27 are not set forth, it is not open to the petitioner to supply the details in order to show that the instrument is duly stamped. The non- compliance of Section 27 has been made punishable by Section 64. It is no where provided in the Act that if the details are not given G under Section 27, the same cannot later on be supplied to the Registrar or to the Collector in order to satisfy them that the value though apparently of a higher amount was mentioned at a lower figure because the property was encumbered by liabilities. Take an illustration where the property is encumbered with a mortgage of one lac of rupees and its market value is three lacs. It may be that in the instrument of partition, the value of the property is shown as two lacs and there is no mention made that the property is encumbered with a mortgage of one lac. If the Registrar refuses to register it on the basis that it is not duly stamped as according to him the value should be three lacs, he could ask the executant to satisfy him as to how the value was calculated. If at that stage the executant shows him a mortgage and the Registrar is satisfied that the mortgage is genuine one and existing one, he will necessarily have to accept the valuation as having been genuinely placed and will not be able to hold that there was any non-compliance of Section 27 with intent to defraud the government. In the present case also the total liabilities have been mentioned and when the question has arisen that the instrument is not duly stamped, the petitioner has supplied the various details constituting the liabilities. It seems to us that there is nothing in the act which debars the petitioner from supplying details and the Collector cannot refuse to consider them on merit in plea of the justification by the petitioner of the value placed by him on the property.
(19) It was contended by the learned counsel for the respondent that, no details are given in the instrument and, thereforee, the Collector was not in a position to determine as to how the value which apparently is stated to be Rs. 7,68,239-54 has been reduced to Rs. 3.61,124-55. To the extent that this argument suggests that it should be open to the Collector to ask for details from the petitioner in order to satisfy him that the instrument is duly stamped the argument is valid. But if the argument further presupposes that because the details are not mentioned in the instrument the value of the property must necessarily be taken to be Rs. 7,68,239-64 even though the total liability of Rs. 4,- 07,115-09 out of this is mentioned in the instrument of partition, the same cannot be accepted. The reason is that the petitioner has valued the property at Rs. 3,61,124-55 and the value of the property for the purpose of Stamp Act has to be accepted as given by the petitioner. The Registrar, if he is not accepting that value, can ask for further details. The details need not have been mentioned in the instrument in order to entitle the petitioner to claim deduction. Even if no details are mentioned we are of the view that it would be permissible to supply the same later on.
(20) It was, however, contended by Mr. Kishore, the learned counsel for the respondent that the value of the separated share of the property in the present case has to be calculated of the total of Rs. 7,68,239-64 and not by making any deduction on account of encumbrances even if they exist. He sought to place reliance on The King v. Judge White- home 1904 K.B. 827. In our view this authority is of no assistance to him. In that case. Section 67 of the County Courts Act, 1888 gave the county court jurisdiction in actions for specific performance of any agreement for the purchase of any Property where the purchase- money shall not exceed the sum of 500. The property in question was of the total value of 1500 but was subject to a charge of 1100, but the actual purchase money paid was 75. The question arose whether the action was within the jurisdiction of the County court and the answer given was that as the purchase money of 75 was less than 500 the court had the jurisdiction. The argument that as the value of the property was more than 500 thereforee, the county court had no jurisdiction was negatived. Mr. Kishore, however, wanted to rely on the observation made in the judgment wherein it was suggested that for the purpose of Stamp Act whenever the property has been sold subject to any charge the consideration or the purchase money has been taken to be the total amount including the charge. The counsel's contention.therefore, was that the value of the property should be the total value without making any deduction on account of encumbrances. In our opinion this authority was not dealing with the point before us and is clearly distinguishable.
(21) In the Indian Stamp Act. 1899, Explanationn to Section 24 provides that in case. of a sale of property subject to mortgage or other encumbrance, any unpaid mortgage money or money charged, together with the interest (if any) due on the same, shall be deemed to be part of the consideration for the sale. A case under this section came up before Bombay High Court. It was held by full bench in Wama in Martand Bhalerao versus The Commissioner Central Division (84T.C.421) (5) that if the property even if subject to a mortgage is sold to the vendee absolving him from the responsibility of removal of encumbrance stamp duty is to be payable only on the amount payable by the vendee and not on the encumbrances. In that case the property was subject to a mortgage of Rs, 13,858-6-0 inclusive of interest while the deed mentioned that it had beau sold for Rs. 10.000.00 and the liability for the mortgage charges and for the amount payable in respect of attachment was accepted by the vendors under the terms of the document. The stamp duty having been paid at Rs. 10,000.00 the Collector demanded the duty on that amount as well as on the amount of encumbrances but the plea was rejected.
(22) In our opinion, thereforee, the value of the separated share or shares of the property means the market value at the time of partition. This market value is liable to be reduced if there are encumbrances which are charged on the property and the value to be calculated for the purpose of stamp duty will be the market value minus the encumbrances or liabilities. What those encumbrances and liabilities are can be disclosed by the petitioner at any stage when the Registrar refuses to register it on the ground that it is not duly stamped or when the Collector has to give his opinion under Section 40 whether the instrument is duly stamped or not. At all these stages it is open to a person to supply details which go to reduce the value or the market value even if the same had not been included in the instrument in the first instance as provided by Section 27. It is not, however, to suggest that any kind of liability which the person may claim is to be automatically deducted from the value of the property. This is on. the reasoning that as it is not permissible under the Stamp Act to hold an enquiry to determine the value placed by the executant, similarly indeterminate liability cannot be allowed to reduce the market value of the property. Because if it is not permissible to hold an enquiry to determine the value it is equally unjust that the Collector should be required to accept any alleged liabilities without having the power to determine whether they are genuine or not. The case, however, is different where the property as such stands encumbered eg. a mortgage where it is not a question of determination 'by the Collector as to the genuineness or otherwise of the liabilities but is only a question of finding that the property stands encumbered. The test, thereforee, in each case will be whether the property is encumbered with certain liability and if it is so encumbered then the value of the property will be the market value minus encumbrances.
(23) The other part of the question relates to the obligation of th0e joint family property under the Hindu Law e.g. whether maintenance, education and marriage of unmarried daughter is a legal liability.ofthe- joint family property. In our opinion the same is a valid liability and to that extent the liability will have to be deducted from the market A value of the property. In M.A. Rajagopala Ayyar v. M.A. Venkataraman and others (51 C.W.N. 829)(6) it has been laid down as under:-
'THEright of an unmarried daughter to maintenance and marriage expenses out of Hindu Joint family property is in lieu of a share on partition. Provision should accordingly be made for her in a decree for partition.'
(24) In Subbayya v. Ananta Ramayya (53 Madras 84)(7) it was held as under:-
'THATthe right of the daughter to her marriage expenses and maintenance is based on her right to or interest in the joint family property, and not based on the natural obligation of a father to maintain his children;
that this obligation of the family property is not affected by a partition between the father and his sons; but the son's share, on partition, is liable for the marriage expenses of the daughter of the father in proportion to the son's share in the property divided.'
(25) In this very case it was observed at page 105 that it may be thai the marriage may never come off for reasons which need not be suggested yet the charge for the expenses was fixed on the property. It will be seen that all these expenses were to be incurred in future but it was held that the family property was liable for it and the same should be made a charge on it.
(26) It was sought to be argued by Mr. Kishore the learned counsel for the respondent that after the coming into force of the Hindu Suc0cession Act, 1956 the liability of the joint family property for the expenses of the marriage of the unmarried daughter no longer survives. We are of opinion that there is no force in this contention. A reference to Section 6 of the Hindu Succession Act would show that the main part of the Section still lays down the doctrine of survivorship. Proviso to the section however introduces a change wherein it is provided that if the deceased had left him surviving a female relative specified in class I of the Schedule or the male relative specified in that class who claims through such female relative the interest of the deceased in the Mitakshara coparcenary property shall devolve by testamentary or intestate succession, as the case may be under this Act and not by survivorship. Moreover this section only provides for an eventuality on the death of the coparcenar. This has no relevancy to the partition of the joint family property and, thereforee, the liability of the joint family property for defraying the marriage expenses of an unmarried daughter continues to be a liability on the joint family property even 'after the coming into force of the Hindu Succession Act, 1956.
(27) Our answer to the question, thereforee, is that it is open to the person to give details of the various deductions which he claims to deduct from the gross assets in order to calculate the duty payable in terms of Article 45 of Schedule I-A of the Indian Stamp Act, 1899. We are also further of the opinion that the expenses for the marriage of the unmarried daughter are a legal liability of the joint family property and the market value of the property has to be calculated by deducting the amount of the said liability, No order as to costs.