Supreme Court of India
M/S Z Engineers Construction Pvt … vs Bipin Bihari Behera on 14 February, 2020Author: L. Nageswara Rao

Bench: L. Nageswara Rao, Hemant Gupta










1. Leave granted.

2. The challenge in the present appeal is to an order passed by the

High Court of Orissa on 24th January, 2019 whereby the petition

filed by the appellant under Article 227 of the Constitution of India,

dismissing an application filed by the appellant under Order XIII

Rule 8 of the Code of Civil Procedure, 1908 1 to impound the power

of attorneys (Exts. 4 and 5), was dismissed.

3. The plaintiffs-respondents instituted a suit for partition through

their power of attorney holder Kishore Chandra Behera (PW-1).

During the cross-examination of PW-1, the present appellants filed

1 for short, ‘Code’

an application under Order XIII Rule 8 of the Code to impound the

power of attorneys, Exts. 4 and 5, inter alia, for the reason that

such power of attorney is to be treated as Conveyance within the

meaning of Article 23 of the Indian Stamp Act, 1899 2 as amended

by Orissa Act No. 1 of 2003 w.e.f. 20 th January, 2003. The amended

Schedule IA reads as under:

Schedule IA

23 Conveyance, as defined by Section
2(10) not being a transfer charged
or exempted under No. 62:
(a) in respect of movable property. Four per centum of
the amount or value
of the consideration
as set forth in the
(b) in respect of immovable property. Eight per centum of
the amount or value
of the consideration
for such conveyance
as set forth therein or
the marked value of
the property
whichever is higher.

xxx xxx

Explanation – For the purpose of this
article, an agreement to sell any
immovable property or a power of
attorney shall, in case of transfer of
the possession of such property
before or at the time of or after the
execution of such agreement or
power of attorney, be deemed to be
a conveyance and the stamp duty
thereon shall be chargeable

Provided that the stamp duty
already paid on such agreement or
power of attorney shall, at the time
of the execution of a conveyance in
pursuance of such agreement or
power of attorney, be adjusted

2 for short, ‘Act’

towards the total amount of duty
chargeable on the conveyance.

4. Similarly, clause (f) of Article 48 was substituted by the amending

Act, contemplating levy of stamp duty as conveyance when such

power of attorney is given for consideration and authorising the

attorney to sell any immovable property.

5. The power of attorney dated 21st February, 2011 was produced in

evidence as Ex.4 on 9th July, 2008 by PW 1- Kishore Chandra

Behera. It was objected to by the present appellants. The other

power of attorney dated 4th October, 2008 was produced as Ex.5 in

evidence on 7th August, 2018 which was again objected to by the

present appellants. The relevant part of the evidence from the

statement of PW 1 reads as under:

“15. …This is the original general power of attorney
dtd.21.02.2011 marked Ext-4 (with obj.).

16. This is the original general power of attorney
bearing No. 10676 dtd.04.10.2008 marked Ext-5 (with

6. It is thereafter an application was filed by the appellants on 3 rd

September, 2018 seeking direction to impound the two power of

attorneys on the ground that they were insufficiently stamped.

Therefore, in terms of Section 35 of the Act, the same were liable to

be impounded and can be admitted in evidence only if appropriate

stamp duty and penalty is paid. It is argued that in terms of the

Act as amended in the Orissa State, the power of attorney shall be

treated to be conveyance if the possession is transferred before or

at the time or after the execution of a power of attorney. It is

contended though, that the cumulative reading of the power of

attorneys shows that the intention is to give an unequivocal right to

the attorney to sell the land. However, the fact that the possession

was transferred to the attorney was admitted when the attorney

appeared as PW-1. Therefore, in terms of explanation to Article 23,

the power of attorney is liable to be impounded and cannot be

admitted unless an appropriate stamp duty is paid.

7. In a judgment reported as Ram Rattan (Dead) by LRs. v.

Bajrang Lal & Ors.3, the question regarding admissibility of a

document was examined for the reason that it was not duly

stamped and registered. The learned trial court made an

endorsement that the document was “Objected, allowed subject to

objection”. However, the learned trial court at the stage of

arguments rejected the documents to be admitted for

consideration, by taking recourse to Section 36 of the Act. This

Court found that Section 36 of the Act could come into play only

when an objection regarding insufficient stamp duty was judicially

determined. Since an objection was raised which was not still

judicially determined, the recourse to Section 36 of the Act was

found to be not tenable, though an objection was raised at the time

of evidence.

8. In Omprakash v. Laxminarayan & Ors.4, the plaintiff claimed

3 (1978) 3 SCC 236
4 (2014) 1 SCC 618

that possession was delivered to him on the basis of an agreement

to sell. The defendant denied the delivery of possession. The

question examined was as to whether the admissibility of

document produced by party would depend upon recitals in the

documents or whether documents are to be considered as

conveyance as defined under the Act as amended by Stamp

(Madhya Pradesh Second Amendment) Act, 1990. The amendment

in the Madhya Pradesh Act is similar to that made in Orissa Act No.

1 of 2003. The High Court accepted the plaintiff’s petition and set

aside the demand of stamp duty treating the document to be

conveyance as ordered by the trial court. The distinguishing factor

is that, in the aforesaid case, possession was said to be delivered

to the prospective vendee in the agreement to sell itself. This

Court held as under:

“16. From a plain reading of the aforesaid provision, it
is evident that an authority to receive evidence shall
not admit any instrument unless it is duly stamped. An
instrument not duly stamped 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 penalty. As we have
observed earlier, the deed of agreement having been
insufficiently stamped, the same was inadmissible in
evidence. The court being an authority to receive a
document in evidence to give effect thereto, the
agreement to sell with possession is an instrument
which requires payment of the stamp duty applicable to
a deed of conveyance. Duty as required, has not been
paid and, hence, the trial court rightly held the same to
be inadmissible in evidence.”

9. Learned counsel for the respondents referred to a judgment of this

Court reported as R.V.E. Venkatachala Gounder v. Arulmigu

Viswesaraswami & V.P. Temple & Anr. 5 to contend that

admissibility of document in evidence can be classified in two

classes: (i) an objection that the document which is sought to be

proved is itself inadmissible in evidence; and (ii) where the

objection does not dispute the admissibility of the document in

evidence but is directed towards the mode of proof alleging the

same to be irregular or insufficient. It was held that such

objections are required to be raised when the document has been

admitted in evidence in terms of provisions of Order XIII Rule 4 of

the Code. However, the said judgment does not deal with the

objection regarding impounding of a document for insufficient

stamp duty as required under the Act. Therefore, such judgment

has no applicability to the facts of the present case.

10. Learned counsel for the respondents refers to another judgment

reported as Bipin Shantilal Panchal v. State of Gujarat &

Anr.6 wherein the appellant was facing a trial for the offences

under the Narcotic Drugs and Psychotropic Substances (NDPS) Act.

During the course of trial, the trial court had chosen to decide

questions of admissibility of documents or other items of

evidence, as and when objections thereto were raised. This Court

found that it is an archaic practice that whenever any objection is

raised regarding the admissibility of any material in evidence, the

Court does not proceed further without passing an order on such

5 (2003) 8 SCC 752
6 (2001) 3 SCC 1

objection. This Court found that any decision on objection is

challenged in appeal or revision which unnecessarily prolongs the

trial. Such practices proved to be hindrance which impede and

restrict the progress of trial proceedings. Such proceedings must

be recast and remodeled to give way to the acceleration of trial

proceedings. It is thereafter, the Court held as under:

“14. When so recast, the practice which can be a better
substitute is this: Whenever an objection is raised
during evidence-taking stage regarding the
admissibility of any material or item of oral evidence
the trial court can make a note of such objection and
mark the objected document tentatively as an exhibit in
the case (or record the objected part of the oral
evidence) subject to such objections to be decided at
the last stage in the final judgment. If the court finds at
the final stage that the objection so raised is
sustainable the Judge or Magistrate can keep such
evidence excluded from consideration. In our view there
is no illegality in adopting such a course. (However, we
make it clear that if the objection relates to deficiency
of stamp duty of a document the court has to decide
the objection before proceeding further. For all other
objections the procedure suggested above can be

11. We find that the trial court as well as the High Court returned the

findings on the bare reading of the power of attorney and observed

that since it is a registered document, therefore, it is properly

stamped. But the question as to whether in terms of the

explanation inserted by the Orissa Act, such power of attorney is

liable to be stamped as conveyance, on account of the delivery of

possession at the time of execution of power of attorney or

thereafter has not been examined.

12. We find that the question whether possession was transferred at

the time or after execution of such power of attorney is a question

of fact which is required to be decided by the Court at the time of

final decision being adjudicated, after evidence is led by the parties

and not merely on the basis of recitals in the power of attorney.

Such process would be fair and reasonable keeping in view the

provisions of Orissa Act.

13. We find that in the facts of the present case, the objection related

to deficiency in stamp duty on a power of attorney which the

appellants claim to be conveyance, depends upon the finding

regarding delivery of possession in terms of the power of attorney.

Generally speaking, such objection is required to be decided before

proceeding further. However, in a case where evidence is required

to determine the nature of the document, it is reasonable to defer

the admissibility of a document for insufficient stamp duty at the

time of final decision in the suit.

14. Therefore, we find that the order passed by the trial court on 14 th

December, 2018 and the High Court on 24 th January, 2019 are

liable to be set aside and are, thus, set aside. The matter is

remitted to the trial court to decide the objection of admissibility of

the document on account of being insufficiently stamped in light of

the findings recorded, after evidence is led by the parties. The

application dated 3rd September, 2018 filed by the appellants shall

be decided along with the main suit, when the question of delivery

of possession at the time of the execution of the power of attorney

or thereafter shall be determined.

15. In view of the above, the appeal is disposed of.



FEBRUARY 14, 2020.



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