Full Judgement
Delhi High Court
Mr. Neeraj Arya vs Rakesh Arya & Anr. on 8 December, 2023
Author: Neena Bansal Krishna
Bench: Neena Bansal Krishna
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Reserved on: 29th November, 2023
Pronounced on:08th December, 2023
CS(OS) 133/2019
MR. NEERAJ ARYA ..... Plaintiff
Through: Mr. Karan Singh Thukral & Mr.
Aman Gupta, Advocates.
versus
RAKESH ARYA & ANR. ..... Defendants
Through: Mr. Vaibhav Dang, Advocate for D-1.
Mr. Rahul Jain & Ms. Deepa Rawat,
Advocates for D-2.
CORAM:
HON'BLE MS. JUSTICE NEENA BANSAL KRISHNA
J U D G M E N T
NEENA BANSAL KRISHNA, J.
I.A. 4279/2022 (u/S 33, 38 & 40 of Indian Stamp Act r/w Section 151 of CPC)
1. The present Application under Sections 33, 38 and 40 of the Indian Stamp Act, 1899 (hereinafter referred to as the "Act, 1899") read Section 151 of the Code of Civil Procedure, 1908 (hereinafter referred to as "CPC, 1908") has been filed on behalf of the applicant/defendant No. 1 seeking impounding of the original Relinquishment Deed dated 12.01.2018 and sending the same to the Collector for determination for payment of proper Stamp Duty and Registration Fee and penalty.
2. The facts in brief are that the plaintiff had filed the Suit for Partition and Injunction in respect of Suit Property bearing No. B-1/97, Paschim
Signature Not Verified DigitallySigned By:SAHIL SHARMA CS(OS) 133/2019 Page 1 of 8 Signing Date:11.12.2023 21:15:16 Vihar, New Delhi measuring 167.22 sq. meters claiming that the said property belonged to his father. The plaintiff's father was survived by two sons and a wife, who each became entitled to 1/3rd share in the suit property.
3. It is asserted that the defendant No. 2/Smt. Shakuntla, mother, has relinquished her 1/3rd share in the suit property in favour of the plaintiff, making him entitled to cumulative of 2/3rd share in the suit property. In this regard, the non-applicant/plaintiff had relied upon the original Relinquishment Deed dated 12.01.2018 which was filed by him pursuant to the Order dated 16.04.2021.
4. It is claimed by the applicant/defendant No. 1 that a perusal of the Relinquishment Deed dated 12.01.2018 shows that the total Stamp Duty at the time of registration of the Instrument paid was Rs. 200/- which is not in accordance with law.
5. The applicant has relied upon the judgment in the case of Tripta Kaushik vs. Sub-Registrar, VI-A, Delhi & Anr. MANU/DE/1090/2020, wherein it has been held that where the relinquishment of the right by the co-owner is only in favour of one of the other co-owners and not against all, it is a document which would be one of Gift/Conveyance and not of release.
6. It is further submitted that the Stamp Duty on Gift/Conveyance Deed in Delhi is payable @ 4% if the Donee /Vendee is a woman and @ 6% if the Donee/Vendee is a man. Since, the Instrument dated 12.01.2018 is indeed a Gift/Conveyance Deed and not a Relinquishment Deed as it has been titled, the Instrument dated 12.01.2018 is liable to be impounded and forwarded to the Collector of Stamps for imposition of proper Stamp Duty/Penalty.
7. It is submitted that in the case of Eider PWI Paging Limited & Ors.
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vs. Union of India & Ors. 2010 (115) DRJ 263, this Court held that a document which is not stamped with the requisite Stamp Duty, is bound to be impounded under Section 3 of the Act, 1899 as the expression used is ―shall‖. There is no discretion with the Court in this aspect as has also been held by the Apex Court in the case of Government of A.P. vs. P. Laxmi Devi (2008) 4 SCC 720. Therefore, a prayer is made that the Relinquishment Deed be impounded and forwarded to the Collector of Stamps for imposition of proper Stamp Duty/Penalty.
8. The proforma defendant/Ms. Shakuntla Arya, who executed the Deed of Relinquishment, in her Reply has submitted that the Relinquishment Deed bears the correct Stamp and Registration Duty. Therefore, it is not liable to be impounded and the application is without merit, which is liable to be dismissed.
9. No formal Reply has been filed on behalf of the plaintiff.
10. Submissions heard.
11. At the outset, it is appropriate to ascertain the essence of a Deed of Relinquishment, its effect and who is entitled to execute such Instrument.
12. The nature of relinquishment of the share by one co-owner in favour of another by a Deed or Instrument was considered by the Full Bench of Madras High Court in the case of The Board of Revenue, the Chief Controlling Revenue Authority vs. V.M. Murugesa Mudaliar of Gudiyatham 1955 SCC OnLine Mad 83, wherein it was observed that in a case where the property is owned by the co-owners, there need not be any Gift/Conveyance Deed executed by one co-owner in favour of another. As each co-owner enjoys the property in part and in whole, it is sufficient if he releases his interest. The result of such release would be the enlargement of share of the
Signature Not Verified DigitallySigned By:SAHIL SHARMA CS(OS) 133/2019 Page 3 of 8 Signing Date:11.12.2023 21:15:16 other co-owner. However, here can be no release by one person in favour of another, who is not already entitled to the property as a co-owner.
13. In a similar vein, the Apex Court in the case of Kuppuswami Chettiar vs. A.S.P.A. Arumugam Chettiar And Another AIR 1967 SC 1395 made a reference to the case of Hutchi Gowder vs. Bheema Gowder (1959) 2 MLJ 324 and S.P. Chinnathambiar vs. V.R.P. Chinnathambiar (1953) 2 MLJ 387 to observe that where the renunciation is in favour of a person who already has a title to the estate, the effect is only the enlargement of such right. Renunciation does not vest in a person a title where it did not exist. While on the other hand, if by virtue of the Instrument, a right/title is conferred on another person who has no pre-existing right in the suit property, then it is a document of transfer of ownership and not a Release Deed irrespective of the word that may be used.
14. In the case of Raghvendra Jeet Singh vs. Board of Revenue and Ors. 2015 SCC OnLine All 5678, the Court considered the distinction between a "Gift Deed" and "Release Deed". It was observed that where by a document, a person voluntarily renounces the coparcenary rights of succession to impartible estate even if for consideration it is a release. There can be no release by one person in favour of another if such other person is not already entitled to share in the property. Thus, by release, there is no transfer of interest or title to another person, who has no pre-existing right to such property. A release can, therefore, be made in favour of a person who has a pre-existing right and interest in the property. It would make no difference even where the release is without consideration.
15. In the present case, the plaintiff has sought 2/3 rd share in the suit property on the basis of the Relinquishment Deed dated 12.01.2018.
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Pertinently, the plaintiff, in favour of whom a Relinquishment Deed has been executed by the proforma defendant, is a co-owner in the suit property. Thus, the moot questions to be ascertained is: firstly, whether a Deed of Relinquishment can be executed in favour of one co-owner to the exclusion of other co-owners; and secondly, if the Instrument dated 12.01.2018 is in the nature of a Gift/Conveyance Deed rather than a Deed of Relinquishment, whether the Instrument is liable to be impounded and requisite Stamp Duty is liable to be paid.
16. The first question has been succinctly addressed by the Madras High Court in the case of Board of Revenue vs. Murugesa, AIR 1955 Mad. 641. It was held that where the release is not in favour of all the co-owners, it cannot be termed as a Relinquishment Deed. It was explained that where release is made by one co-owner in favour of another to the exclusion of all other co-owners having right and interest in the property, the Deed would not be a Deed of Release but a Conveyance Deed.
17. In the case of Kothuri Venkata Subba Rao vs. District Registrar of Assurances Gudur AIR 1986 AP 42, it was held that in order to classify as a "Release", the executant of the instrument having common or joint interest along with others, should relinquish his interest which would automatically result in the enlargement of the interest and others. But where he executes the documents in respect of his share in favour of a particular co-owner, it cannot be treated as a release and must come within the definition of conveyance.
18. It was also explained in Raghavendra (supra) that in order to distinguish between a Release Deed and a Gift Deed/Sale Deed, the decisive factor is the actual character of the transaction and precise nature of the
Signature Not Verified DigitallySigned By:SAHIL SHARMA CS(OS) 133/2019 Page 5 of 8 Signing Date:11.12.2023 21:15:16 rights created by the Instrument. It was further explained that by a Release Deed, the share of one co-owner is a release in favour of all other co-owners leading to enlargement of the right of all other co-owners, but there is no transfer of title since the other co-owners already have a title in the subject property.
19. The Single Bench of this Court in Tripta Kaushik (supra) has referred to all the aforementioned judgments to conclude that a document which releases its share in respect of one co-owner to the exclusion of other is, in fact, a Conveyance/Gift Deed and is required to be affixed with the requisite Stamp Duty.
20. In the present case, defendant No. 2/mother, who was holding 1/3rd share as a co-owner in the suit property, has relinquished her share vide Relinquishment Deed dated 12.01.2018 in favour of her one son (plaintiff herein), to the exclusion of the other son (defendant No. 1). It is thus conspicuously evident that the Relinquishment Deed dated 12.01.2018 is in the nature of a "Gift Deed".
21. Having observed that the Relinquishment Deed dated 12.01.2018 is not in the nature of a release of interest, the second question of the requisite Stamp Duty liable to be paid has to be determined.
22. Section 33 of the Act, 1899 deals to the examination of Instruments that have not been duly stamped. The provision reads as under: -
―Section 33.- Examination and impounding of instruments. -
(1) Every person having by law or consent of parties authority to receive evidence, and every person in charge of a pubic 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.
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(2) 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 1 [India] when such instrument was executed or first executed: Provided that--
(a) nothing herein contained shall be deemed to require any Magistrate of Judge of a Criminal Court to examine or impound, if he does not think fit so to do, any instrument coming before him in the course of any proceeding other than a proceeding under Chapter XII or Chapter XXXVI of the Code of Criminal Procedure, 1898 (V of 1989);
(b) in the case of a Judge of a High Court, the duty of examining and impounding any instrument under this section may be delegated to such officer as the Court appoints in this behalf.
(3) For the purpose of this Section, in cases of doubt. --
(a) the [State Government] may determine what offices shall be deemed to be public offices; and
(b) the [State Government] may determine who shall be deemed to be person in charge of public offices.‖
23. From a reading of Section 33 of the Act, 1899, it is evident that the requisite Stamp Duty is required to be paid. Therefore, the Relinquishment Deed dated 12.01.2018 has to be necessarily impounded and forwarded to the Collector of Stamps for adjudication of the deficit Stamp Duty/penalty payable on the said document as held in Eider PWI (supra) and P. Lakshmi Devi (supra).
24. Accordingly the Relinquishment Deed dated 12.01.2018 is hereby impounded. The Registry is directed to forward the Relinquishment Deed dated 12.01.2018 to the Collector of Stamps.
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25. On receipt of the aforesaid document, the Collector of Stamps is directed to do the needful and submit the impounded document to this Court with the requisite orders within the period two months.
26. Accordingly, the present application is disposed of in the above terms. CS(OS) 133/2019
27. List before the Joint Registrar for completion of pleadings and admission/denial of the documents on 27.03.2024.
(NEENA BANSAL KRISHNA) JUDGE DECEMBER 08, 2023 S.Sharma/Ek
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