Thursday, 26 August 2021

Thiruvengada Pillai Vs. Navaneethammal & Anr. - The Indian Stamp Act, 1899 nowhere prescribes any expiry date for use of a stamp paper.

Supreme Court (19.02.2008) in  Thiruvengada Pillai   Vs. Navaneethammal & Anr.   [Writ Petition (civil)  290 of 2001] held that; 

  • The Indian Stamp Act, 1899 nowhere prescribes any expiry date for use of a stamp paper. Section 54 merely provides that a person possessing a stamp paper for which he has no immediate use (which is not spoiled or rendered unfit or useless), can seek refund of the value thereof by surrendering such stamp paper to the Collector provided it was purchased within the period of six months next preceding the date on which it was so surrendered. 

  • The stipulation of the period of six months prescribed in section 54 is only for the purpose of seeking refund of the value of the unused stamp paper, and not for use of the stamp paper. Section 54 does not require the person who has purchased a stamp paper, to use it within six months. Therefore, there is no impediment for a stamp paper purchased more than six months prior to the proposed date of execution, being used for a document.


Excerpts of the order; 

# 5. On the said pleadings, three issues were framed by the trial court : 

  • (i) whether the agreement put forth by the plaintiff was true or concocted ? 

  • (ii) whether the second defendant had purchased the suit property for valid consideration ? and 

  • (iii) whether the plaintiff was entitled to the relief of specific performance ? 


The plaintiff examined himself as PW-1 and the scribe of the agreement (Ramaswami Pillai) as PW-2 and an attesting witness to the sale agreement (Venkatesha Pillai) as PW-3. The agreement of sale was exhibited as Ex. A-1. The notice and reply were marked as Ex. A2 and A4. The second defendant, (purchaser of the site), gave evidence as DW-1 and the third defendant, who was also a witness to the sale deed dated 11.2.1980, was examined as DW-2. The sale deed dated 11.2.1980 executed by first defendant in favour of second defendant was marked as Ex.B2 and previous title deed was exhibited as Ex. B4. The plaintiff and his witnesses gave evidence that the sale agreement was duly executed by first defendant in favour of plaintiff. The defendants gave evidence about the sale in favour of second defendant and denied execution of any agreement of sale in favour of plaintiff.


# 6. The trial court after appreciating the evidence, dismissed the suit by judgment and decree dated 28.2.1984. It held that the agreement of sale put forth by plaintiff was false and must have been created after the sale on 11.2.1980 in favour of second defendant, by using some old stamp papers in his possession. The said finding was based on the following facts and circumstances :

  • (a) The sale agreement (A-1) was not executed on currently purchased stamp paper, but was written on two stamp papers, one purchased on 25.8.1973 in the name of Thiruvengadam and another purchased on 7.8.1978 in the name of Thiruvengadam Pillai.

  • (b) The two attestors to the agreement were close relatives of plaintiff. One of them was Kannan, brother of the plaintiff and he was not examined. The other was Venkatesa Pillai, uncle of plaintiff examined as PW3. The scribe (PW-2) was a caste-man of plaintiff. Their evidence was not trustworthy.

  • (c) Though the agreement of sale recited that the possession of the suit property was delivered to plaintiff, no such possession was delivered. On the other hand, the second defendant was put in possession on execution of the sale deed and she put up a thatched hut in the schedule property and was in actual physical possession. This falsified the agreement.

  • (d) If really there was an agreement of sale, in the normal course, the plaintiff would have obtained the title deeds from the first defendant. But the earlier title deeds were not delivered to him. On the other hand, they were delivered to the second defendant who produced them as Ex.B3 and Ex.B4.

  • (e) In spite of defendants denying the agreement (Ex.A1), the plaintiff failed to discharge his onus to prove that execution of the agreement as he did not seek reference to a fingerprint expert to establish that the thumb impression on the agreement was that of the first defendant.


# 9. On the contentions urged, the following questions arise for consideration :

  • (i) Whether the agreement of sale executed on two stamp papers purchased on different dates and more than six months prior to date of execution is not valid?

  • (ii) Whether the first appellate court was justified in comparing the disputed thumb impression with the admitted thumb impression and recording a finding about the authenticity of the thumb impression, without the benefit of any opinion of an expert?

  • (iii) Whether the High Court erred in reversing the judgment of the first appellate court in second appeal?


Re : Question (i)

# 11. The Trial Court and the High Court have doubted the genuineness of the agreement dated 5.1.1980 because it was written on two stamp papers purchased on 25.8.1973 and 7.8.1978. The learned counsel for first respondent submitted that apart from raising a doubt about the authenticity of the document, the use of such old stamp papers invalidated the agreement itself for two reasons. Firstly, it was illegal to use stamp papers purchased on different dates for execution of a document. Secondly, as the stamp papers used in the agreement of sale were more than six months old, they were not valid stamp papers and consequently, the agreement prepared on such 'expired' papers was also not valid. We will deal with the second contention first. The Indian Stamp Act, 1899 nowhere prescribes any expiry date for use of a stamp paper. Section 54 merely provides that a person possessing a stamp paper for which he has no immediate use (which is not spoiled or rendered unfit or useless), can seek refund of the value thereof by surrendering such stamp paper to the Collector provided it was purchased within the period of six months next preceding the date on which it was so surrendered. The stipulation of the period of six months prescribed in section 54 is only for the purpose of seeking refund of the value of the unused stamp paper, and not for use of the stamp paper. Section 54 does not require the person who has purchased a stamp paper, to use it within six months. Therefore, there is no impediment for a stamp paper purchased more than six months prior to the proposed date of execution, being used for a document.


# 12. The Stamp Rules in many States provide that when a person wants to purchase stamp papers of a specified value and a single stamp paper of such value is not available, the stamp vendor can supply appropriate number of stamp papers required to make up the specified value; and that when more than one stamp paper is issued in regard to a single transaction, the stamp vendor is required to give consecutive numbers. In some States, the rules further require an endorsement by the stamp vendor on the stamp paper certifying that a single sheet of required value was not available and therefore more than one sheet (specifying the number of sheets) have been issued to make up the requisite stamp value. But the Indian Stamp Rules, 1925 applicable to Tamil Nadu, do not contain any provision that the stamp papers of required value should be purchased together from the same vendor with consecutive serial numbers. The Rules merely provide that where two or more sheets of paper on which stamps are engraved or embossed are used to make up the amount of duty chargeable in respect of any instrument, a portion of such instrument shall be written on each sheet so used. No other Rule was brought to our notice which required use of consecutively numbered stamp papers in the State of Tamil Nadu. The Stamp Act is a fiscal enactment intended to secure revenue for the State. In the absence of any Rule requiring consecutively numbered stamp papers purchased on the same day, being used for an instrument which is not intended to be registered, a document cannot be termed as invalid merely because it is written on two stamp papers purchased by the same person on different dates. Even assuming that use of such stamp papers is an irregularity, the court can only deem the document to be not properly stamped, but cannot, only on that ground, hold the document to be invalid. Even if an agreement is not executed on requisite stamp paper, it is admissible in evidence on payment of duty and penalty under section 35 or 37 of the Indian Stamp Act, 1899. If an agreement executed on a plain paper could be admitted in evidence by paying duty and penalty, there is no reason why an agreement executed on two stamp papers, even assuming that they were defective, cannot be accepted on payment of duty and penalty. But admissibility of a document into evidence and proof of genuineness of such document are different issues.


# 13. If a person wants to create or a back-dated agreement, the first hurdle he faces is the non-availability of stamp paper of such old date. Therefore tampering of the date of issue and seal affixed by the stamp vendor, as also the entries made by the stamp vendor, are quite common in a forged document. When the agreement is dated 5.1.1980, and the stamp papers used are purchased in the years 1973 and 1978, one of the possible inferences is that the plaintiff not being able to secure an anti-dated stamp paper for creating the agreement (bearing a date prior to the date of sale in favour of second defendant), made use of some old stamp papers that were available with him, to fabricate the document. The fact that very old stamp papers of different dates have been used, may certainly be a circumstance that can be used as a piece of evidence to cast doubt on the authenticity of the agreement. But that cannot be a clinching evidence. There is also a possibility that a lay man unfamiliar with legal provisions relating to stamps, may bona fide think that he could use the old unused stamp papers lying with him for preparation of the document and accordingly use the old stamp papers.


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