MANU/AP/0176/2018

Equivalent Citation: 2018(190)AIC 755, 2018(4)ALD173, 2018(4)ALT1

IN THE HIGH COURT OF JUDICATURE AT HYDERABAD FOR THE STATE OF

TELANGANA AND THE STATE OF ANDHRA PRADESH
CRP No. 3333 of 2013
Decided On: 07.06.2018
Appellants: Tatineni VEnkata Subba Rao
Vs.
Respondent: Kodali Jayalaxmi Devi
Hon'ble Judges/Coram:
D.V.S.S. Somayajulu, J.
Counsels:
For Appellant/Petitioner/Plaintiff: V. Narasimha Murthy
ORDER
D.V.S.S. Somayajulu, J.
1. This Civil Revision Petition is filed against order, dated 05.07.2013, in EA. No. 48
of 2013 in OS. No. 25 of 2017 on the file of the Court of the II Additional District
Judge, Krishna at Vijayawada.
2. EA. No. 48 of 2013 is filed under Order VII Rule 14 of CPC by the petitioner in the
lower Court (by the claim petitioner in the claim petition) to receive the documents,
which are filed along with the said application. The respondent filed a counter stating
that the documents cannot be received in evidence. His particular objection was
about document No. 4, which is an agreement of sale dated 06.10.1974. The
objection raised in the counter is that the document cannot be received as evidence
as it is not validly stamped and is also not registered as required under law. The
lower Court, after hearing the application, held that the objections raised are not
sustainable in law and particularly, as the application is filed to condone the delay in
receiving the documents. The application was allowed; the delay was condoned and
the documents were directed to be received subject to proof and relevancy. It is this
order that is questioned in this appeal.
3. This Court has heard Sri V. Narasimha Murthy, learned counsel appearing for the
petitioner. Despite opportunities, the respondents did not appear and argue.
4 . The short and simple question that involved is, whether document No. 4 can be
received in evidence or not. Learned counsel for the revision petitioner argued that
the document cannot be received in evidence as it is neither properly stamped nor
registered. Learned counsel for the petitioner filed additional papers on 13.04.2018 in
which a copy of the agreement of sale dated 08.10.1974 (document No. 4) and the
gift deed executed subsequent thereto were filed. The contention of the learned
counsel for the petitioner is that document No. 4, which is an agreement of sale, is a
document of title and that therefore, it requires registration and stamp duty. Learned
counsel relies upon the recitals in the gift deed dated 13.10.2005 (document No.
4695/2005), wherein the vendor states that she has acquired title to the property by

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the document dated 08.10.1974. Therefore, the argument of the learned counsel is
that as the parties treated the agreement dated 08.10.1974 as a sale deed
transferring title to the property, it cannot be received in evidence at all. Learned
counsel relied upon the following case laws:
1 . Rachakonda Ramakoteswara Rao and others v. Manohar Fuel Centre,
Nereducherla, Khammam MANU/AP/1254/2002 : 2003 (2) ALD 638,
2. Pariti Suryakanthamma and another v. Saripalli Srinivasa Rao and another
MANU/AP/0009/2010 : 2010 (2) ALT 648,
3 . Avinash Kumar Chauhan v. Vijay Krishna Mishra MANU/SC/8502/2008 :
(2009) 2 SCC 532,
4 . Suraj Lamp and Industries Private Ltd., v. State of Haryana and another,
and MANU/SC/1222/2011 : (2012) 1 SCC 656
5. Omprakash v. Laxminarayan and others. MANU/SC/1019/2013 : (2014) 1
SCC 618
5 . Relying on these judgments, learned counsel vehemently argued that the
agreement of sale dated 08.10.1974 cannot be received in evidence as it neither
stamped nor registered. He relies upon the recitals of the gift deed for which this
document dated 08.10.1974 is a link document. The vendor/donor states that she has
acquired title through this document. Therefore, learned counsels argument is that it
is to be treated as a document of title and cannot be received in evidence.
6. The two applicable sections/provisions of law, which fall for consideration in this
revision are Section 35 of the Indian Stamp Act, 1899 (for short the Stamp Act) and
Section 49 (c) proviso of the Registration Act, 1908.
7. Section 35 of the Stamp Act is to the following effect:
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 deficient portion thereof exceeds five rupees,
of a sum equal to ten times such duty or portion;
(b) where any person from whom a stamped receipt could
have been demanded, has given an unstamped receipt and
such receipt, if stamped, would be admissible in evidence
against him, then such receipt shall be admitted in evidence
against him on payment of a penalty of one rupee by the
person tendering it;

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 (c) where a contract or agreement of any kind is effected by
correspondence consisting of two or more letters and any
one of the letters bears the proper stamp, the contract or
agreement shall be deemed to be duly stamped;
(d) nothing herein contained shall prevent the admission of
any instrument in evidence in any proceeding in a Criminal
Court, other than a proceeding under Chapter XII or Chapter
XXXVI of the Code of Criminal Procedure 1898;
(e) nothing herein contained shall prevent the admission of
any instrument in any Court when such instrument has been
executed by or on behalf of the Government or where it
bears the certificate of the Collector as provided by Section
32 or any other provision of this Act.
Section 49 of the Registration Act is to the following effect:
Section 49 in The Registration Act, 1908
4 9 . Effect of non-registration of documents required to be registered. No
document required by section 17 [or by any provision of the Transfer of
Property Act, 1882 (4 of 1882)], to be registered shall
(a) affect any immovable property comprised therein, or
(b) confer any power to adopt, or
(c) be received as evidence of any transaction affecting such
property or conferring such power, unless it has been registered:
[Provided that an unregistered document affecting immovable
property and required by this Act or the Transfer of Property Act,
1882 (4 of 1882), to be registered may be received as evidence of a
contract in a suit for specific performance under Chapter II of the
Specific Relief Act, 1877 (3 of 1877) [***] or as evidence of any
collateral transaction not required to be effected by registered
instrument.
(emphasis supplied)
8 . The provisos to both these Sections have a fundamental impact on the present
case.
9 . Under Section 35 of the Stamp Act, it is clearly mentioned that no instrument
chargeable with duty shall be admitted in evidence for any purpose. (emphasis
supplied).
1 0 . Whereas, Section 49 of the Registration Act, does not contain such express
language and on the other hand, the proviso says that document can be received as
evidence of any collateral transaction not required to be effected by a registered
instrument. (emphasis supplied)
11. In Rachakonda Ramakoteswara Raos case MANU/AP/1254/2002 : 2003 (2) ALD
638 (supra), the learned single Judge of this Court noticed the difference between
Section 35 of the Stamp Act and Section 49 of the Registration Act and held that if a

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document is not properly stamped or insufficiently stamped, it cannot be received in
evidence for any purpose under Section 35 of the Stamp Act. But under Section 49 of
the Registration Act, if a document is not registered, it can be received for collateral
purpose. He however concluded at para 4 as follows: All of this will not have any
significance once the requisite stamp duty and penalty are paid.
12. Similarly, in Pariti Suryakanthammas case MANU/AP/0009/2010 : 2010 (2) ALT
648 (supra), the learned Judge clearly held that as the document is insufficiently
stamped; it cannot be used for any purpose. Because it is not registered, it can be
used for collateral purpose. In that case the learned Judge found that the parties were
using the document for a main purpose and not a collateral purpose.
1 3 . Next judgment cited is Avinash Kumar Chauhan v. Vijay Krishna Mishra
MANU/SC/8502/2008 : (2009) 2 SCC 532 (supra). In this case also the Hon'ble
Supreme Court held that under Section 35 of the Stamp Act, unless the document is
properly stamped, it cannot be received in evidence. The Hon'ble Supreme Court held
that either for collateral purpose or for a main purpose, an insufficiently stamped
document cannot be used in evidence. Therefore, the Court held that an insufficiently
stamped agreement of sale cannot be acted upon by the Court. The word any purpose
whatsoever were interpreted to mean both main and collateral purpose.
14. Suraj Lamp and Industries Private Ltd. MANU/SC/1222/2011 : (2012) 1 SCC 656
(supra) is a case, wherein the Hon'ble Supreme Court of India reiterated the need for
having a registered document for sale and held that GPA cum agreements of sale are
not sale deeds.
1 5 . In Omprakashs case MANU/SC/1019/2013 : (2014) 1 SCC 618 (supra), the
Hon'ble Supreme Court again was called upon to decide a similar question and in
paras 15 and 16, the Court held that unless the agreement of sale was adequately
and properly stamped, it cannot be received in evidence. The Supreme Court also
pointed out that the recitals in the document are important. There was an explanation
in the State of Madhya Pradesh, which was material in this decision. Therefore, the
Supreme Court held that the document was inadmissible in evidence. The question
that fell for consideration before the Hon'ble Supreme Court was whether the
admissibility of a document would depend upon the recitals in the document or upon
the pleadings. In this case, the Supreme Court clearly held that at the time of
considering the question of admissibility of a document, it is the recitals in the
document that would decide the admissibility of the document.
16. In the present case argued before this Court, it is recited in the document dated
08.10.1974 that the possession has been handed over to the vendee. However, the
document also states that because of a bar/ban in the area for registration, the
registration is being postponed and that when the bar is removed, the property would
be registered either in the name of the vendee or his nominee. The document clearly
mentions that for the present, registration is not possible and that immediately after
the bar is removed, the registration will be affected.
1 7 . Therefore, it is clear that this document by itself contemplates a future
registration and the conveyance of title.
1 8 . The submission of the counsel is that in the subsequent sale deed that is
executed on 13.10.2005, (document No. 4695/05), it is recited that the vendor
acquired title under the document dated 08.10.1974. The counsel hence contended
that the document dated 08.10.1974 is to be treated as a sale deed only and as it is

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not registered, it cannot be received in evidence at all.
19. This submission cannot be appreciated and the Court relies upon the findings of
the Hon'ble Supreme Court in Omprakashs case MANU/SC/1019/2013 : (2014) 1 SCC
618 (supra), wherein the Hon'ble Supreme Court held that at the time of admissibility
of a document, the recitals in the document alone are critical and the parties
interpretation of the same either in the pleading or elsewhere in not material. As
noticed, the document dated 08.10.1974 contemplates the execution of a further
registered document. This Court also notices that a Division Bench of the Andhra
Pradesh High Court in a case reported in A. Kishore @ Kantha Rao v. G. Srinivasulu
MANU/AP/0209/2004 : 2004 (3) ALD 817 held that an unregistered document can be
marked for a collateral purpose. The Division Bench answered the reference made by
considering the three judgments of the Hon'ble Supreme Court of India and ultimately
came to the conclusion that an unregistered lease deed, which is compulsorily
registrable can be admitted in evidence for a collateral purpose.
20. In R. Suresh Babu v. G. Rajalingam and others 2007 (1) ALT 668, a learned
single Judge of this Court undertook a review of the case law on a very similar
question and noticed the judgments of the Supreme Court of India in K.B. Saha and
Sons Pvt. Ltd. v. Development Consultant Ltd., MANU/SC/7679/2008 : 2008 (8) SCC
564 and also the judgment of M/s. Sms Tea Estates P. Ltd. v. M/s. Chandmari Tea Co.
P. Ltd. and other MANU/SC/0836/2011 : 11 AIR SCW 4484 judgments and ultimately
held that for a collateral purpose the document can be received in evidence. Although
this was a case relating to an agreement of sale, still the discussion in this case is
valid and appropriate. In any view of the matter, the Division Bench in A. Kishores
case MANU/AP/0209/2004 : 2004 (3) ALD 817 (supra) is good law.
21. Another single Judge of this Court in Nookala Krishnaiah and Anr. v. Nookala
Dakshina Murthy and Ors. MANU/AP/0225/2007 : 2007 (5) ALT 758 also held that for
a collateral purpose an unregistered document can be received in evidence.
22. Therefore, on a review of the entire case law available on record, this Court is of
the opinion that an insufficiently stamped document cannot be received in evidence
for any purpose (main or collateral). If an insufficiently stamped document comes
before a Court, a duty is cast upon the Court to impound the document by following
the procedure under the Stamp Act and ensure that the requisite stamp duty is paid.
Only after the requisite stamp duty is paid, the document becomes admissible in
evidence. If the duty/penalty is not paid, it is wholly inadmissible.
23. In case of a document that is required to be registered under law, but is not
registered, as per the proviso to Section 49(c) of the Registration Act, which is a
Central Act, the document can be received for a collateral purpose in terms of the
proviso.
24. In this revision, as the issue involved is decided, this Court is not pronouncing
on what is a collateral or a main purpose. The witness is not before this Court and
this Court cannot comment for what purpose the witness is tendering the documents.
The Court that is faced with that question has to decide the purpose for which the
document is being tendered- whether it is tendered in evidence for a main purpose or
a collateral purpose.
25. For the purpose of answering and deciding this revision petition, it is enough to
state that the recitals in the document dated 08.10.1974 are critical for deciding its
admissibility. The mere fact that in a subsequent document this document dated

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08.10.1974 is relied upon as a document by title is not very material as the Supreme
Court clearly held that the subsequent conduct of the party is not important and the
recitals in the document are important.
26. Therefore, the revision petition is dismissed.
27. In the result, the Civil Revision Petition is dismissed.
No order as to costs.
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