Allowed

Smt. Gowramma v. Sri. Dayananda Pai

Karnataka HC6 Jun 2022WP/31702/2017

Case brief

AI extract

What is this about?

The High Court allowed a writ petition quashing a civil judge order that rejected an application for stamp duty determination. The Court held that even in a recovery suit based on an agreement to sell, the question of stamp duty liability arises and must be addressed.

What did the court decide?

The impugned order was set aside; the learned Judge directed to determine stamp duty and penalty under Article 5(e)(ii) of the Karnataka Stamp Act, 1957.

Smt. Gowramma Vs Sri. Dayananda Pai — Property and Title | Karnataka HC (2022)

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 6^TH DAY OF JUNE, 2022

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BEFORE

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THE HON’BLE MR. JUSTICE SACHIN SHANKAR MAGADUM

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WRIT PETITION NO.31702 OF 2017(GM-CPC)

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BETWEEN:

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SMT. GOWRAMMA W/O D. KALLAPPA AGED ABOUT 54 YEARS, RESIDING AT NO.389, KALLAPPA LAYOUT, AMURTHAHALLI, SAHAKARNAGARA POST, BANGALORE-560 092.

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...PETITIONER

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(BY SRI.P M NARAYANASWAMY, ADVOCATE)

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AND:

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SRI. DAYANANDA PAI S/O LATE P NARASIMHA PAI AGED ABOUT 68 YEARS, NO.10/1, LAKSHMINARAYANA COMPLEX, GROUND FLOOR, PALACE ROAD, BANGALORE-560 052.

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…RESPONDENT

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(BY SRI.H.R.ANANTHAKRISHNA MURTHY, ADVOCATE)

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THIS PETITION IS FILED UNDER ARTICLE 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE IMPUGNED ORDER DATED 30.6.2017 ON I.A.III IN O.S.1663/2014 PASSED BY

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THE XX ADDL. CITY CIVIL AND SESSIONS JUDGE AT BANGALORE AT ANNEX-A AND ALLOW THE I.A.III FILED BY THE PETITIONER UNDER ORDER XIII RULE 8 OF CPC R/W SEC. 33 AND 34 OF THE KARNATAKA STAMP ACT.

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THIS PETITION COMING ON FOR PRELIMINARY HEARING IN 'B' GROUP THIS DAY, THE COURT MADE THE FOLLOWING:

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ORDER

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The captioned writ petition is filed by the defendant questioning the order of the learned Judge passed on IA.No.3 filed under Order 13 Rule 8 of CPC read with Section 151 of CPC and Sections 33 and 34 of the Karnataka Stamp Act, 1957.

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The respondent/plaintiff has filed a recovery suit based on an agreement to sell. The respondent/plaintiff claimed that the present petitioner/defendant agreed to sell the suit schedule property and accordingly executed an agreement to sell on 04.08.2011 under which the respondent/plaintiff alleges that he has paid an advance amount of Rs.1 Crore. The respondent/plaintiff has filed a recovery suit seeking refund of advance amount paid under

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the agreement to sell and also claimed interest for a sum of Rs.61,13,333/- with interest at the rate of 24% per annum.

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The present petitioner filed an application in I.A.No.3 by contending that Ex.P-2 (agreement to sell) is not sufficiently stamped and therefore, same is liable to be impounded and the Court is required to determine the penalty and deficit stamp duty. The defendant claimed that the agreement of sale is written on a Rs.200/- stamp paper while under the alleged suit agreement, the respondent/plaintiff claimed that he has paid a sum of Rs.1 Crore and therefore, contended that the document is insufficiently stamped.

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The learned Judge has rejected the application on the premise that the present suit is not one for specific performance of contract. The learned Judge was of the view that the respondent/plaintiff has instituted a suit for recovery of money and therefore, question of impounding the document

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and consequently, determining the deficit stamp duty would not arise for consideration.

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It is against this order, the petitioner/defendant is before this Court.

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Heard learned counsel appearing for the petitioner and learned counsel appearing for the respondent. Perused the order under challenge.

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The learned Judge has proceeded on an assumption that since it is a recovery suit, question of examining the payment of stamp duty would not arise for consideration. The said finding is palpably erroneous. Though it is a recovery suit, the entire claim of respondent/plaintiff is based on an agreement to sell. The right to recovery is based on this document and therefore it is a suit document. Though the agreement to sell is one without possession, the stamp duty payable is governed by Article 5(e)(ii) of the Karnataka Stamp Act, 1957. In terms of Article 5(e)(ii), the respondent/plaintiff

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has to pay stamp duty at the rate of 10 paisa for every Rs.100/- or par thereof on the market value equal to the amount of consideration. The maximum stamp duty payable is Rs.20,000/-.

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In the present case on hand, the

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respondent/plaintiff claims that a sum of Rs.1 Crore was paid as an advance amount under the agreement to sell. Therefore, the stamp duty has to be determined on a sum of Rs.1 Crore in terms of Article 5(e)(ii) of the Karnataka Stamp Act, 1957. It is in this background, this Court would find that the order of the learned Judge in rejecting the application is erroneous and the same is not at all sustainable.

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9. For the foregoing reasons, I pass the following:

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ORDER

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(i) The writ petition is allowed;

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(ii) The impugned order dated 30.06.2017 passed in O.S.No.1663/2014 on I.A.No.3 is set aside;

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(iii) The learned Judge is directed to determine the stamp duty and penalty therein in terms of Article 5(e)(ii) of the Karnataka Stamp Act, 1957;

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(iv) It is open for both the parties to canvass their arguments on I.A.No.3 afresh if they chose to.

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Sd/JUDGE

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Smt. Gowramma v. Sri. Dayananda Pai

Case brief

What is this about?

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Smt. Gowramma v. Sri. Dayananda Pai

Case brief

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