Stamp duty payable would be at the rate prevailing on the date of execution of the instrument and the penalty would be at the rate prevailing on the date on which the insufficently stamped instrument is sought to be tendered in evidence.
Section 34 of the Act, thus, provides a procedure to recover the stamp duty and a penalty at the rate of 2 per cent of the deficient portion of the stamp duty for every month or part thereof, from the date of execution of an instrument which either of the parties to the proceedings seeks to produce in evidence and which is either not duly stamped or insufficiently stamped. Perusal of Section 34 of the Act clearly shows that though the date of execution of the instrument is relevant for both, duty and penalty, the duty payable would be at the rate prevailing on the date of execution of the instrument and the penalty would be at the rate prevailing on the date on which the insufficently stamped instrument is sought to be tendered in evidence. This is logical, because, the duty becomes payable on execution, whereas, the penalty becomes payable when the deficiency in the instrument is sought to be removed or regularised. The use of the words "from the date of execution of such instrument" cannot be construed to mean that the penalty is leviable at the rate prevailing on the date of execution of the instrument. It merely means that the insufficiently stamped instruments executed prior to 1.5.2001 can become admissible in evidence, if penalty at the rate of 2 per cent of the deficient portion is paid from the date of execution of the instrument. Once Clause (a)(ii) of Section 34 is substituted with effect from 1.5.2001, the substituted provision would apply for all the insufficiently stamped instruments whether executed prior or after 1.5.2001. The argument of the respondent that Section 34 as amended by 2001 Amendment is not applicable to the insufficiently stamped instruments executed prior to 1.5.2001 runs counter to the expressed words used therein. If the intention of the leglislature was to restrict the amended provision to the instruments executed only after 1.5.2001 it would have expressly stated so. In the absence of any such restriction to read words "from the date of execution of such instrument" in the substituted Section 34(a)(ii) to apply only to the instruments executed after 1.5.2001, would mean adding the words to section which is not permissible in law.
Bombay High Court
Krishna Sheena Shetty vs Suresh Anant Sawant And Nandkumar ... on 8 April, 2008
Equivalent citations: 2008 (110) Bom L R 1262
