- In Pedapudi Alfred Johnson Jeyakaran Jesudasan V. The State of AP, Justice U. Durga Prasad Rao, under Section 18 of the Indian Stamp Act of 1899, ruled that if a General Power of Attorney (GPA) is executed outside of India without being duly stamped and is presented before the third respondent within three months, the Court has the authority to order the impoundment of the GPA. The Hon'ble Court further contended that the Registrar's rejection of the document was unwarranted.
- In this case, a writ petition was filed as the District Registrar of Vijayawada had refused to accept the GPA executed by the writ petitioner's sister, a resident of Canada, which would have authorized the DR to act as the writ petitioner's sister's GPA to sell her residential property. The basis for rejecting the GPA, as stated earlier, was a more than three months of delay in presenting it to validate it, which constituted a violation of the Indian Stamp Act, 1899. Regarding this, the petitioner contended that a COVID lockdown was imposed throughout the country, which restricted the petitioner from moving out. The Public prosecutor argued that the SC ruling, which increased the time limit for filing cases, only applied to cases that could not be filed due to COVID limitations. However, the petitioner's case was not a legal procedure.
- Section 18 in The Indian Stamp Act, 1899 deals with instruments other than bills and notes issued outside of India. It stipulates that any instrument charged with a duty executed exclusively outside of India must be stamped within three months of being received in India for the first time.
- Section 3 in The Indian Stamp Act, 1899 talks about the instruments chargeable with duty.
- Article 48 in Schedule I talks about power of attorney not being a Proxy.
- In a relevant case, Anitha Rajan W/o. Angoor Rajan v. The Revenue Divisional Officer (2010), it was held that when an instrument chargeable with duty is implemented outside of India but is not duly stamped, it may be taken within three months to the Collector, who shall stamp the same in such manner as the Government may by rules specify, with a stamp of such value as the Government may by rules stipulate.
- In another case, Malaysian Airlines Systems BHD v. STIC Travels (P) Ltd.2(2001), a GPA issued in Kuala Lumpur was not stamped correctly as per the Indian Stamp Act and was objected to when submitted in an application on that basis. In this case, the Supreme Court impounded the power of attorney and directed the petitioner to deposit the required stamp duty, as well as to direct the Registrar Judicial to produce an endorsement upon production of the challan from the treasurer that the Court impounded the document and that the required stamp duty and penalty had been charged, and to present the document before the Court.
- Considering the aforementioned legislations and case laws, the Hon'ble Court observed that a GPA issued outside India and received in India related to any property located in India is subject to stamp duty. The Court further observed that the petitioner had not submitted any significant evidence to establish that he could not leave due to the lockdown orders. Furthermore, the benefit of excluding the restriction applied solely to processes brought before courts or tribunals.
- The Hon'ble Court ruled that the aforementioned authority might seize the instrument executed outside India, which is not adequately stamped, collect the requisite stamp tax and penalty, and verify the document. Furthermore, the Court stated that if a document, such as a Power of Attorney, were performed outside India on Indian non-judicial stamp paper prior to or at execution, Section 18 of the Stamps Act would not apply.
- Therefore, the Hon’ble SC allowed the writ petition.
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