S.N. Andley, C.J.
(1) This judgment will dispose of Stamp Duty Reference No. 2 of 1 68 under section 57(1) of the Indian Stamp Act made by Chief Controlling Revenue authority, hereinafter referred to as 'the Authority' and Civil conditional. The first question of law posed for the opinion of this Court is :-
(I)Whether C.C.R.A. is bound to make a reference under section 57(1) of the Indian Stamp Act, to the High Court at the instance of a parly even when the C.C.R.A. had, afterhearing the petitioner, expressed a final opinion on merits of the question involved and had not thought it fit to refer that matter suo motu to the High Court and In which the petitioner had also not requested for a reference to the High Court before the C.C.R.A. had decided the matter himself without considering such a reference to be necessary.' Then the Authority has stated that in case the answer of this Court to the above question is io the affirmative, 'then and only then the reference on the following two points may also be answered, otherwise not.' The other two points then set out are :- '(ii) As to whether the impounded mortagage deed in this case amounts to a mortgage with possession attracting stamp duty under sub-clauae(a) of Article 40 or it was a simple mortgage attracting stamp duly under sub-clause (b) of Article 40 of Schedule 1-A of the Indian Stamp Act, 1899. (iii) Aa to whether the Municipal Transfer Duty levied at 4% under the Government of India, Ministry of Home Affairs Notification No. 20/2/62-Delhi-II dated 29th June, 1963 and inadvertently referred to the order of the then Chief Controlling Revenue Authority dated 14th September, 1968 as having been charged under section 147 of the Municipal Corporation Act, 19'7 was legally payable.'
(2) Because of the conditional reference, P.S Aggawal who is concerned with the reference had to file the above writ petition. The facts leading to the reference may now be stated.
(3) P.S. Aggarwal is the owner of Shop No. M 36. Connaught Circus, New Delhi On April 8, 1965, he granted an oral lease of this shop to Dena Bank at a rental of Rs. 6.000.00 per mensem. Aforesaid Aggarwal had been granted a loan of Rs. 1,50,000.00 by the Dena Bank against an equitable mortgage and possession of the ahop was given to the Dena Bank. However, possession was restored to Aggarwal to make a mezzaanine floor and some other additions and alterations in the shop. After the mazzanine floor had been constructed and some of the additions and alterations had been made, Aggarwal did not hand Dack possession of the shop to the Dena Bank which led to the filing of a suit by the Dena Bank against Aggarwal on September 1, 1965 for declaration and posseision. This suit was compromised on September 26, 1966. It was agreed between the parties, inter alias that Aggarwal shall deliver vacant possession of this shop to the Dena Bank by the end of October, 1966 or as soon as the requisite repairs were completed. The payment of the lease amount was to commence from August 1, 1966 ai the agreed rate of Rs. 6,000.00 per month. It was further agreed that the Dena Bank will advance a further sum of Rs. 3,00.000.00 to Aggarwal against the execution of a simple mongage deed. it appears from two receipts both dated March 24, 1967 (Annexures A. 2 and A. 3 to the Writ Petition) that the Dena Bank started paying rent for the said shop from October 1, 1966 at the rate of Rs. 6.000/. per month and again came into passession of the said shop as lessees with effect from August 1, 1966. On March 6, 1967 two documents were executed between Aggarwal and Dena Back. One was lease which recites that the said shop was given to the Dena Bank on lease for a period of ten years beginning from October 1, 1966 at a monthly rental of Rs. 6.0UO.00 which was renewable for a further period on such terms and conditions as may be agreed upon between the parties. The lease recites the loan of Rs. l,50,000 .00 already received by Aggarwal and thai a further sum of Rs. 3,00,000/. was to be paid to him on the execution of a regular deed of mortgage. It was further agreed that the Dena Bank was entitled to adjust the entire monthly lease amount of Rs. 6,000.00 towards the said mortgage loan of Rs. 4,50,000.00. The other document was a deed of mortgage in respect of the aggregate loan of Rs. 4,50,000.00. It records that the Dena Bank had occupied the said shop in respect of which a separate document of lease was being executed and that the Dena Bank would be entitled to adjust the loan amount from out of the lease money of Rs. 6,000.00 per month.
(4) When the mortgage deed was presented for registration, it was impounded by the Sub Registrar, New Delhi, on the ground that it was adeed of mortgage with possession which was liable to stamp duty and Corporation tax amounting Rs. 29.250.00 instead of stamp duty of Rs. 4,500.00 paid thereon. The Collector, thereforee, issued a notice to Aggarwal as to why the deficiency of stamp duty to the extent of Rs. 24, 750.00 together with penalty not exceeding ten times of that be not recovered from him. By his order dated April 10, 1967, the Collector was of the opinion that the mortgage deed nowhere spoke of the personal liability of the mortgagor; that possession had been delivered to the mortgagee though prior to the execution of the mortgage in question and that the mortgage money and interest thereon was to be adjusted from out of the lease money of Rs. 6,000.00 per month from March 1,1967 to the end of February, 1974. The Collector was of the view that the mortgage deed had been given the shape of a simple mortgage in order to evade the stamp duty and Corporation duty and he would have decided the case accordingly but for the circumstance that possession had been obtained by the mortgagee from the mortgagor prior to the execution of the mortgage deed. Being doubtful, be made a reference to the Authority under section 56(2) of the Indian Stamp Act.
(5) The Authority by its order dated September 14, 1967, gave a finding that the possession of the property, subsequently mortgaged, has been given ahead of the execution of the mortgage deed through a lease. He was, thereforee, of the opinion that ii was mortgage with possession under Article 40 (a) of the First Schedule to the Indian Stamp Act and would, thereforee, attract duty as a conveyance lor a consideration equal to the amount secured by it. This was followed by, a notice dated October 18, 1967 to Aggarwal to show cause why the deficient stamp duty of Rs. 20,250.00 and a penalty of Rs. l,000.00 be not recovered from him. Thereupon, on November 20, 1967, Aggarwal filed an application under section 57 of the Indian Stamp Act before the Authority for a reference to the High Court on the following two questions :-
'(1)On the facts and circumstances of the cage and true construction of the Mortgage deed dated 6th of Match, 1967. executed by the petitioner herein in favor of Respondent No. 3 with regard to Shop No. M-36, Connaught Circus, New Delhi is a simple mortgage and not a mortgage with possession and is liable to stamp duty under Article 40 Clause (b) of Schedule I of the Indian Stamp Act and the same bearing a stamp of Rs. 4500.00 is properly stamped. (2) The said mortgage deed relating to the properly situated in Connaught Circus. New Delhi, is not liable to payment of any stamp duty under Section 147 of Delhi Municipal Corporation Act of 1957.'
The Authority disposed of this application by its order dated February 20,1968. The Authority was of the opinion that it was not bound to refer a case to the High Court under section 57 of the Indian Stamp Act at the instance of a party when it 'did not himself entertain any doubt on the point at issue and had actually disposed of the reference, made by the Collector of Stamps under section 56(2) of the Indian Stamp Act by expressing a definite and categorical opinion.' This opinion wa8 expressed in spite of the judgment of the Supreme Court in Banarsi Dass Ahluwalia v. The Chief Controlling Revenue Authority Delhi, where it has in the clearest possible terms been observed that section 57(1) of the Indian Stamp Act imposes a duty on the Authority to state a case when it raises a substantial question of law and that,-
'THATduty is not affected by the question whether the case is pending before the Authority or not. The principle underlying the decision is that section 57 affolds remedy to the citizen to have his case referred to the High Court against an order of a revenue authority imposing stamp duly and/or penalty provided the application involves a substantial question of law and imposes a corresponding obligation on the authority to refer it to the High Court for its opinion. Such a right and obligation cannot be construed to depend upon any subsidiary circumstance such as the pead.ency of the case before the Authority.'
In view of the above pronouncement, we fail to see bow the Authority could distinguish the case pending before it. No attempt has been made by Mr. R. L. Tadon, learned counsel for the Authority, to make such a distinction before us and we, thereforee, answer the first question in the affirmative.
(7) The second question relates to the interpretation of Article 40(a) of Schedule 1-A of the Indian Stamp Act. The clause provides that in the case of a mortgage deed 'when possession of the property or any part of the property comprised in such deed is given by the mortgagor or agreed to be given' it will attract the same duty as a Conveyance for a consideration equal to the amount secured by, such deed. So far as this clause is concerned, the matter is concluded by a Full Bench decision of this Court in M/s. Dhoomi Mal Ram Chand v. Collector of Stamp. where it has been observed that where possession prior to the execuiton of the mortgage deed originated purely in the capacity of the mortgagee as a lessee, such possession had nothing to do with the subsequent mortgage and the original possession as a lessee continues in the capacity of a leasee and does not change. Counsel for the Authority has relied, before us, upon clause (a) of Article 40 read with the Explanationn to this Article. This Explanationn is in these words:-
'Amortgagor who gives to the mortgagee a power-of-attorney to collect rents or a lease of the property mortgaged or part thereof, is deemed to give possession within the meaning of this Article.'
It is contended that the facts leading to the execution of the deed of lease and the mortgage deed show that they were executed on the same date. they were part of the same transaction and that the right of the Dena Bank to adjust the lease money of Rs. 6.000.00 per month amounted to the giving of a power of attorney to the Bank to collect rents and, alternatively, Aggarwal had given a lease of the property mortgaged to the Dena Bank.
(8) Although, the lease and the deed of mortgage talk of the right of the Dena Bank to adjust the monthly lease amount of Rs. 6,000.00 towards mortgage money, we find it difficult to accept the contentioan that such right of adjustment amounts to the giving of a power-of attorney as contemplated by the Explanationn. Power-of-attorney is a special document which is defined in the Indian Stamp Act by subsection (21). of section 2 as including any instrument (not chargeable with a fee under the law relating to court-fees for the time being in force) empowering a specified person to act for and to the name of the person executing it There is no such document which was executed by Aggarwal in favor of Dena Bank of the person executing it. There is no such document which was executed by Aggarwal in favor of Dena Bank where by the Dena Bank were empowered to act for and in the name of Aggarwal. ..When the Explanationn talks of a power-of-attorney it means a power-of-altorney as defined in the Indian Stamp Act and merely because the Dena Bank were given the right of adjustment of the rent payable by them, it would not follow that they became the power-of attorney holders of the mortgagor.
(9) Then the question is whether a lease of the property mortgaged was given by Aggarwal to Dena Bank within the meaning of the latter part of the Explanationn. On this question, the finding of fact of the Authority as also of the Collector Is that the Dena Bank had become lessees of the said shop under Aggarwal ahead of the execution of the mortgage deed and as it appears from the documents on the record, the shop in question had been given by Aggarwal to Dena Bank on lease with effect from October 1, 1966 long betore the execution of the mortgage deed. The lease contemplated by fie Explanationn must be a lease given at the time of execution of the mortgage deed or by it. If the mortgagee is already in possession as a lessee when the mortgage deed is executed .the case will not be covered by the Explanationn. For these reasons, the answer to the second question is that/the mortgage deed in question does not amount to a mortgage with possession attracting stamp duty under suo clause (a) of Article 40 and it is simple mortgage attracting stamp duly under sub-clause (b) of Aricle 40 of Schedule 1 A of the lndian Stamp Act, 1899.
(10) Because of the answer to the second question, the answer to the third question must be in the regutive.
(11) In view of the aforesaid answers, it is unnecessary to deal with the writ petition which is dismissed a,a infructuous without any order as to costs.
(12) In the Reference, the answers to the questions will be as follows:-
'Question No. (i) ... Yes. Question No. (ii) ... The mortgage deed in question does not amount to a mortgage with possegsion attracting stamp duty under sub-clause (a) of Article 40 and it is a simple mortgage attracting stamp duly under sub clause (b) of Article 40 of Schedule 1-A of the Indian Stamp Act. 1899. Question No. (iii) ... No.
(13) The petitioner will have his costs of this reference. Counsel s fee Rs,. 300.00.