TMI Blog2016 (3) TMI 1144X X X X Extracts X X X X X X X X Extracts X X X X ..... number of instruments. These instruments are in favour of or executed by such entities. It came to the notice of the State that in relation to such instruments and which are of the nature referred to in clause (a) to (g) of section 30, the proper stamp duty has not been collected. Therefore, section 30A was inserted by Maharashtra Act No.8 of 2013 with effect from 1st May, 2013. The Statement of Objects and Reasons to this amendment would indicate as to how there was a revenue loss. We find that both sections of the Maharashtra Stamp Act, 1958, and the Registration Act, 1908, read and understood so also interpreted in the above manner need not be struck down. While arriving at the above conclusion, we have taken the aid and assistance of the very principles which have been pressed into service by Mr. Tulzapurkar. We need not advert to each and every judgment relied upon by counsel. We have referred to the very principles and which are enunciated in the case of State of Madhya Pradesh vs. Rakesh Kohli & Anr. (2012 (5) TMI 262 - SUPREME COURT OF INDIA ) about constitutional validity of taxing statutes. We are not in agreement with Mr. Tulzapurkar that the provisions of the S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppropriate writ, order and/or direction to declare that the Maharashtra Act No. X of 2012 insofar as it enacts Registration Act Amendments (Exhibit B) is ultra vires and void on account of not only being repugnant to sub-section (f) of Section 58 of the Transfer of Property Act but also being vague, arbitrary and irrational and be pleased to quash the same. (c) that this Hon'ble Court be pleased to issue a writ of Certiorari or a writ in the nature of Certiorari or any other appropriate writ, order and/or direction to quash and set aside the Circular dated August 8, 2013 (Exhibit C) issued by Respondent No.2 on account of the same being ultra vires, void and invalid and be pleased to quash the same. (d) for a writ of Mandamus or a writ in the nature of Mandamus or any other appropriate writ, order and/or direction from this Hon'ble Court directing the Respondents as well as their officers, servants and agents to refrain/abstain from taking any steps in furtherance or implementation or enforcement of the Maharashtra Tax Laws (Levy and Amendment) Act, 2013 insofar as it enacts the Stamp Act Amendment (Exhibit A). (e) for a writ of Mandamus or a writ in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed the Circular notifying the petitioners of the Stamp Act Amendment which makes all the banks and financial institutions liable for payment of proper stamp duty on instruments specified under section 30(a) to (g) of the Stamp Act, creating a right in favour of such banks and financial institutions. 10. In view of the aforesaid arbitrary and unreasonable enactment, not only will all the banks and financial institutions be liable to make payment of proper stamp duty on instruments executed on or after 1st May, 2013, but in terms of sub-section (2) of the impugned section 30A, also verify that too by 30th September, 2013, whether adequate stamp duty has been paid on all instruments executed prior to the aforesaid date and are still effective. Furthermore banks and financial institutions are now obligated to determine whether proper stamp duty has been paid and in the event of deficit stamp duty, impound such instruments by 30th September, 2013 and send them to the Collector for recovery. 11. Moreover the unreasonable objective of respondent No.1 is evident from the fact that if the banks and financial institutions fail to impound such instruments, the banks and financial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... every stage and every year, especially given that the representatives of the banks cannot be expected to be aware of or know the appropriate stamp duty payable on any instrument. In any event there is also no guidance awarded for such officer to check or cross verify his/her interpretation of relevant section of the Maharashtra Stamp Act. That apart the arbitrariness and irrationality of the said section is evident in view of the fact that the same does not provide for any consequence or mechanism in the event the adjudication by such officer of duty payable is incorrect or improper. 15. The petitioners further state that the effect of section 10D is that the officer so nominated assumes the role of an adjudicating authority as if such officer was himself empowered to decide what stamp duty would be applicable to the document produced before him. He has the power to interpret and decide the amount of applicable stamp duty and such the officer would then be able to bind the stamp authorities with his decision irrespective of whether or not it is accurate or erroneous. 16. The petitioner further states that since only a few banks so authorised would be empowered to carry o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gnant to sub-section (f) of section 58 of the Transfer of Property Act, are being abused and misused by the Registration Authority. Accordingly, it is submitted that the section 89B amendments ought to be declared ultra vires and invalid on this ground as well. 18. It is pertinent to note that while section 89B amendment only stipulates that if the notice of intimation is not filed within 30 days of creation of a mortgage by way of deposit of title deeds, any further transaction undertaken by the mortgagor, where the mortgaged property is the subject matter, shall be void. On the other hand, the circular goes beyond the scope of section 89B amendment and stipulates that the failure by the mortgagor to file the notice of intimation within 30 days of creation of the mortgage, the mortgage cannot be enforced. The circular thus travels beyond the scope of what the legislature has intended to legislate by the section 89B amendment. 19. It is based on the above material that the provisions in the two different enactments are challenged and the aforequoted reliefs are claimed. Annexure-A to the writ petition is an extract of the amendment to the Maharashtra Stamp Act, 1958, inco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s filed and copies thereof were served, an affidavit-in-reply has been filed on behalf of the State in which these amendments are justified. 23. In paragraph 2 to 7 and 17 of the affidavit, this is what is stated : 23(a) At the outset, the petition is misconceived, does not disclose any cause of action against the Respondent Nos.1 to 3. I say that by this petition, the petitioners are challenging the validity of section 30A of the Maharashtra Stamp Act, 2013, which is annexed as Exhibit A at page 38 to the petition on the ground that it is violative of Article 14 of the Constitution of India since it is discriminatory in nature as it differentiates only bank and financial institutions from other commercial institutions for imposition of obligation and penalties in term of Maharashtra Stamp Act Amendment to pay proper stamp duty on the documents mentioned in section 30A of commencement of Maharashtra Tax Laws (Levy and Amendment) Act, 2013, if any, to collect it from other party and further to verify the adequacy of stamp duty paid on the instrument executed by or in favour of the financial institution prior to commencement of Maharashtra Tax Laws (Levy and Amendment) Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... very and on failure to do so, the concerned banks and financial institutions shall be liable to pay penalty equivalent to stamp duty payable on instrument. The said amendment has come into force with effect from 1st May, 2013. I say that obligation on financial institutions and banks to impound document under amended Section 30A(2) of the Maharashtra Stamp Act is incidental to levy of stamp duty. The aforesaid obligation under section 30A(2) of Maharashtra Stamp Act is in respect of outstanding loan or alive loan which is still being administered by the bank and financial institution. 23(d) I say that under section 34 of the Maharashtra Stamp Act, 1958, instruments which are not stamped are not admissible in evidence in Court of law. Hence, the instrument created by or in favour of financial institutions creates right in their favour and if not properly stamped will not be enforceable in court of law. Therefore, to protect the interest of the financial institution and bank and further to see that proper stamp duty is paid, the obligation is cast on the financial institution to pay the stamp duty with liberty to collect the same from the borrowers. 23(e) I say that under E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding of documents not properly stamped. I say that the penalty laid down in section 30A(3) of Maharashtra Stamp Act is incidental to enforcement of stamp duty. I say that unreasonableness is not the same as hardship as alleged or at all. I say that it must be unreasonable in law and not in fact. I say that the stamp duty is a tax and hardship is not relevant in interpreting fiscal statutes are well known principles. In the field of taxation the legislature enjoys greater latitude for classification. 23(g) I say that the obligation impounded by the Amendment to the Maharashtra Stamp Act by inserting section 30(A) has only laid down the responsibility of payment of stamp duty in respect of those documents and transactions to which the financial institution is a party. I say that the object of the Maharashtra Stamp Act is to collect proper stamp duty on the instrument or conveyance and the said Act is a fiscal measure enacted to secure revenue for the State and therefore, to enforce fiscal measure, the State for certain classes of instruments executed by certain classes of persons, has laid the obligation on the said class of persons for recovering the proper stamp duty in respec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... public interest can it be said that the State legislature has overreached or has taken over taken over or interfered with the field occupied by the Banking Regulation Act, 1949. 29. As already held, the competence of the State to enact the Maharashtra Stamp Act, 1958, is not disputed. The power in that regard is to be found in Entry No.63 of List II, namely, the State List of the very schedule to the Constitution of India. That deals with rates of stamp duty in respect of documents other than those specified in the provisions of List-I. With regard to rates of stamp duty. 30. In such circumstances, it is not possible to agree with Mr. Tulzapurkar that the impugned amended provision in the Maharashtra Stamp Act, 1958, should be be struck down on the ground that the purports to take over or occupied the field occupied by the Banking Regulation Act, 1949. 31. The lead arguments were canvassed by Mr. Virag V. Tulzapurkar, learned senior counsel and he would submit that this provision is ultra vires Article 14 and 19(1)(g) of the Constitution of India. Mr. Tulzapurkar would submit that Maharashtra Stamp Act and its predecessor law, namely, Bombay Stamp Act, 1958 seeks to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hen relied upon the definition of the term 'market value' in section 2(na), 'mortgage deed' appearing in section 2(p), the word 'Schedule' as defined in section 2(s) and submits that by section 3 of the Act, the instruments chargeable with duty are set out. Chapter II, according to Mr. Tulzapurkar, has the broad heading Stamp Duties and under that sub-heading '(A) Of the Liability of Instruments to Duty' appears in section 3. Mr. Tulzapurkar submits that how an instrument would be charged with duty, namely, the nature thereof, how if a single transaction is embodied and contained in several instruments is a matter dealt with by section 4 and instruments relating to several distinct matters are dealt with by section 5. Mr. Tulzapurkar then invites our attention to the sections in this Chapter and would urge that the sub-headings of this would indicate as to how liability of instruments to duty of stamp and the mode of using them, of the time of stamping instruments, on valuations for duty are matters exclusively dealt with by the authorities under the Stamp Act. Mr. Tulzapurkar submits that by section 30 by whom the duties are payable are set out and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tors etc., who are either a party to or a beneficiary of a commercial contract or agreement, however on such other commercial entities no similar obligation has not been imposed. Therefore, in view of the discriminatory nature of the Stamp Act Amendment, the Stamp Act Amendment clearly violates Article 14 of the Constitution in as much as it differentiates and isolates only banks and financial institutions from other commercial entities for imposition of obligations and penalties in terms of the Stamp Act Amendment. There is no legally justifiable reason or ground as to why only banks, financial institutions and housing finance companies should be required to undertake the heavy responsibility of verifying payment of proper stamp duty and no other entities have any such obligation, with respect to future transactions and more so in case of past transactions and only with respect to those instruments which are falling in clauses (a) to (g) of Section 30 of the Stamp Act and not those which fall outside Section 30 of the Stamp Act and also the Stamp Act Amendments do not apply to those private parties or persons even though they execute the same type of instruments in their normal co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1) of Section 6 of the Banking Regulation Act. In view thereof, the Stamp Act Amendment enacted by the State Legislature is beyond the legislative competence and power of the State Legislature and hence ultra vires the Constitution. To ensure the payment of Stamp Duty is not a part of the banking business and the function of ensuring the payment of proper stamp duty cannot be and is not the activities of business or function which can be imposed on banks in as much as, by doing so, the banks will be forced to discharge functions contrary to Section 6 of the Banking Regulation Act. (d) Further, without prejudice to the aforesaid, assuming for the sake of argument that even if the State Legislature is competent to enact the said Stamp Act Amendment, the Stamp Act Amendment ought to be declared void and invalid on account of its inherent arbitrariness, vagueness and ambiguity. Section 30A of the Stamp Act as enacted imposes a liability on the banks and financial institutions to verify if the stamp duty paid on the instrument/documents executed before May 1, 2013 and effective , is proper and adequate. The Stamp Act Amendment does not prescribe any time limit within which the do ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... undertake the cumbersome, time consuming and voluminous exercise of ascertaining whether proper stamp duty has been paid on all instruments executed prior to the coming into force of the Stamp Act Amendment (i.e. May 1, 2013) by September 30, 2013 and to impound all such instruments clearly would be an extremely expensive and impractical exercise for the banks and financial institutions. Such a harsh imposition would not only increase the unnecessary expense of the banks and financial institutions but also hamper the current on-going business of the banks, as they would have to dedicate a large part of their resources, manpower and time to perform such a cumbersome activity and time consuming exercise. Therefore, it is evident that such a retrospective liability is too severe and unreasonable and such imposition would cripple the business of the banks as the banks would now have to dedicate its resources and time primarily for verifying the requisite stamp duty payable on every instrument executed by the banks right from 1959 till date. The Supreme Court has taken the view that in order to establish arbitrariness or unreasonableness, it does not become necessary to show that the b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rther, unlike sub-section (1) of Section 30A of the Maharashtra Stamp Act, where the State Legislature atleast gave a right to the bank to recover the amount of stamp duty paid by the bank from the borrower/obligor, sub-section (2) of the Stamp Act Amendment does not even give any such right to recover the penalty so imposed upon banks for failure to impound the documents, from the borrowers/obligors even if a corresponding right is available to the banks under the agreements/documents in question. Accordingly, it is abundantly clear that the banks and financial institutions are heavily prejudiced because of the unreasonableness, arbitrariness and harshness inflicted by the Stamp Act Amendment. (h) It is urged that levy of tax, collection of tax levied and verification whether the payment of tax by the tax-payers is adequate and in accordance with law are the functions of the authorities of the Government which levies the tax and such functions cannot be delegated to the tax payer himself, in this case the banks and financial institutions. In the present case, in terms of the Stamp Act Amendment, the obligation to verify adequacy of stamp duty paid on a document executed in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roughly before hastily enacting the law thereby imposing the obligations upon only banks and financial institutions and housing finance companies to determine the proper stamp duty payable on the documents/instruments and to find out the deficiency in payment of stamp duty and thereafter to impound such documents/instruments. In these circumstances, it is ex facie unreasonable, arbitrary and irrational for the Stamp Act Amendments to require the banks and financial institutions to impound all documents on which they consider insufficient stamp duty to have been paid, failing which the banks and financial institutions would be liable to a penalty equal to the stamp duty payable on such instrument, without a right to recover it from the borrower/obligor, as may otherwise be provided for in the agreement/ document. (j) The State Legislature has not considered the probability that since some of the documents/instruments are pertaining to transactions conducted in the past years and therefore, in all probability the borrowers may not even be available or traceable. Moreover, the Stamp Act Amendment is unclear on what happens when a borrower of a bank, brings a document executed i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nstitutions under sub-section (2) of the Stamp Act Amendment is over and above and in addition to the penalty provisions already in place under the Stamp Act? It appears that the intention of the Respondent No.1 is to enrich itself by prescribing a penalizing provision under Section 30A (2) when there are provisions already in place under the Stamp Act to which also adequately protects the interest of revenue of the State. Therefore, the Stamp Act Amendment enacted gives unbridled power to the State to impose further penalties over banks and financial institutions, irrespective of the fact that the banks and financial institutions may not be at fault. The Supreme Court has observed that an instrument which is not duly stamped cannot be received in evidence by any person who has authority to receive evidence and it cannot be acted upon by that person or by any public officer. This is the penalty which is imposed by law on the person who may seek to claim any benefit under an instrument if it is not duly stamped. Once detected the authority competent to impound the document can recover not only duty but also penalty, which provision protects the interest of revenue. In the ev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d financial institutions. (n) Without Prejudice to all that is stated above, a bare perusal of the Circular and the Stamp Act Amendment annexed to it evidences that there are certain contradictory provisions in the Circular and Section 30A which renders the Stamp Act Amendment uncertain and ambiguous. While, on one hand the Circular provides that in case of documents executed before May 1, 2013 and are effective, it should be verified whether proper stamp duty has been paid or not. If it has not been paid, it should be ensured that proper stamp duty (which includes penalty, if any) is paid by September 30, 2013 by the partly liable to pay it. Else the documents have to be impounded and forwarded to the Collector of Stamps before September 30, 2013. Failure to do this would result in penalty (equal to Stamp Duty Payable) being levied on Banks/ FIs. ,on the other hand, Section 30A provides that In respect of any such instrument executed before the date of commencement of the Maharashtra Tax Laws (Levy and Amendment) Act, 2013, and are effective and where proper stamp duty is not paid, then the financial institution shall impound such instrument on or before the 30th S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of India, International Finance Corporation, and it is not clear whether all such institutions are expected to comply with the Stamp Act Amendment enacted to the Stamp Act. 34. Thus, the sum and substance of Mr. Tulzapurkar arguments are that section 30A by sub-section (1) and which opens with a non obstante clause, merely because any writing in favour of any financial institution is created by the instrument referred to in clauses (a) to (g) of section 30, the liability contrary to the mandate of that section and ordinarily understood of paying stamp duty is foisted and thrusted upon the bank and financial institution. If that is not discharged then the bank may face several consequences, including penalties. Secondly, any instrument of the nature specified in sub-section (1) but effective before the commencement of the Maharashtra Tax Laws (Levy and Amendment) Act, 2013, and the proper stamp duty is not paid, the same would have to be impounded. Apart from the enormity and impracticality, the obligation and duty is so unreasonable that for the performing the same, the banks / financial institutions would have to undertake an adjudication. In that regard, he relied upon the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate Government or any class of them. Secondly, by obliging the Nationalized banks to collect duties and remit them would not just create a collection centre, but require the banks to perform a host of other functions and duties not contemplated by the Stamp Act, 1958. 37. It is clear that when sub-section (3) of sub-section 30- A provides for imposition of penalty that is understood to be a civil liability. In the case of Director of Enforcement vs. MCTM Corporation Pvt. Ltd. AIR 1996, SC, 1100, the Supreme Court holds that breach of civil obligation also attracts penalty and when the law so enacts it is not understood to be a penalty in the sense of criminal law. Imposition of penalty for the breach of civil obligation laid down under the Act does not impose any sentence for the commission of any offence. The explanation penalty is a word of wide significance. Some times it means recovery of an amount as a penal measure even in civil proceedings. 38. Further elaborating this concept in a latter decision in the case of Pratibha Processors Ors. vs. Union of India Ors., AIR 1997 SC 138, the Hon'ble Supreme Court explains it thus : fiscal statutes with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (1) of section 17 as clauses (e), (f) , (g) and (h) an agreement relating to the deposit of title deeds, where such deposit has been made by way of security for the repayment of a loan or an existing or future debt, a sales certificate issued by any competent officer or authority under any recovery act, irrevocable Power of Attorney relating to transfer of immovable property in any way, executed on or after the commencement of the Registration (Maharashtra Amendment) Act, 2010 (Mah. X of 2012) with effect from 1st April, 2013. If these are the documents of which registration is made compulsory, then, they cannot be out of public domain. There is nothing secretive or clandestine about them. 41. Yet, what one finds by introduction of section 89-B and particularly sub-section (2) thereof is that non filing of a notice of intimation, of having mortgaged an immovable property by way of a deposit of title deeds, to the registering officer within the local limits of whose jurisdiction the whole or any part of the property is situate, as required by sub-section (1) of section 89-B, would make a subsequent transaction in relation to or affecting the immovable property which is the subj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the sections under distinct Chapters of the Maharashtra Stamp Act, 1958. Mr. Samdani would submit that sub-section (2) of section 30A employs the word 'effective'. In a way, that means valid and binding. Therefore, the banks would be required to impound the instrument within the meaning of this sub-section if it is effective and that would entail a process by which it will have to adjudicate. That power to impound without adjudication cannot be exercised and the bank must necessarily undertake this exercise. Therefore, there cannot be a delegation or outsourcing of an adjudicatory function or power. Once there is a power in the financial institution to seize or take possession of an instrument then conferment of such a power and failure to exercise it resulting in penalty would denote as to how the amendments to the Stamp Act are completely unconstitutional or unworkable. 45. Mr. Kamdar, learned senior counsel appearing for the Indian Banks Association, while adopting the arguments submitted that classification of documents broadly made has been added to by an additional classification or sub-classification in terms of section 30A of the Maharashtra Stamp Act, 195 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e and imposition of tax could be sustained and the rigours that are ordinarily applied would have to be relaxed in the case of a taxing statute. Once there is a wide discretion and latitude in the Legislature, then, it would be apparent that the financial institutions such as banks, non-banking financial company, housing finance company or alike deal with large number of instruments. These instruments are in favour of or executed by such entities. It came to the notice of the State that in relation to such instruments and which are of the nature referred to in clause (a) to (g) of section 30, the proper stamp duty has not been collected. Therefore, section 30A was inserted by Maharashtra Act No.8 of 2013 with effect from 1st May, 2013. The Statement of Objects and Reasons to this amendment would indicate as to how there was a revenue loss. The State could not afford to loose revenue in the form of stamp duty on these instruments. The sweep of the banking transactions having increased manifold, large scale urbanization having taken place, banks deal in number of ways with its constituents, customers, clients and others, the services provided by the banking sector ever expanding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xecuted before the date of commencement of the Amendment Act and in the event such instruments are effective, but where proper stamp duty is not paid, then the financial institution shall impound such instrument on or before the date specified in sub-section (2) and forward the same to the Collector for recovery. Once again, this is a power to facilitate collection of duty and through the bank. The bank has to impound the instrument on which proper stamp duty is not paid and forward it to the Collector for recovery. The Collector would proceed in terms of his powers under Chapter III or the further Chapters and recover the duty in accordance with law. There is absolutely no force in the contentions that the bank would be discharging any quasi judicial functions or exercising adjudicatory power or there is any outsourcing of the said adjudicatory powers in their favour. The impounding is only when on effective instruments, the proper stamp duty is not paid. The payment of stamp duty is evident and proof thereof is to be found on the face of the instrument itself. If the payment is made, then it is impressed with stamps. If it is not so impressed, then, only a look at the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mended Section 30A deals with duties payable by financial institutions with regard to instruments referred to in Section 30. It begins with a non-obstante clause which draws these instruments concerning financial institutions out of the purview of instruments specified in Section 30, and makes it the duty of the financial institutions to ensure that the liability to pay proper stamp duty is fulfilled. The very nature of Section 30 and Section 30A is to classify the persons who are liable to pay the duty. There is therefore no justification in the Petitioner s submission that Section 30A creates a class or that such a class has no nexus with the object sought to be achieved. (e) Section 30A has to be seen to operate in a limited sphere of instruments. Although it refers to the instruments covered by Section 30 (a) to (g), it is concerned only with those instruments which create right in favour of the financial institutions. Hence, not every instrument which comes to a financial institution is covered by Section 30A. Only such instruments which create rights in favour of the financial institutions are required to be attended to by the financial institution for the purpose of e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e part of the financial institution and cannot be stretched to mean that it is an adjudicatory activity. (k) Adjudication is a specific power given in Chapter III. Its provisions empower the Collector to perform necessary functions relating to adjudication as to the proper stamp. The term liability to pay proper stamp duty used in Section 30A(1) and the term adjudication as to proper stamps used in Section 31 need not be confused. The first relates to a calculation required to be made with reference to Schedule I, whereas the latter is in essence a quasi-judicial function permitting receiving of evidence and any further enquiry that may be needed to determine whether the instrument is chargeable. It is not the intendment of the ammendment to confer any adjudicatory power much less impose a duty to adjudicate on the financial institutions. (l) The Petitioners submission that the failure of the financial institution not to impound and forward an instrument within the period specified in Section 30A(2) which attracts penalty may be answered thus. In a given case, assuming the instrument is impounded after the date specified it would still be dealt with in terms of S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of mortgage which is compulsorily registrable. What is dealt with by Schedule I of Article VI of the Maharashtra Stamp Act and the compulsorily registrable instruments provided in the Registration Act is not to be confused with an intimation which would be required to be forwarded about the act of deposit of title deeds with an intent to create an equitable mortgage. It is that intimation which must be given and the failure to give it entails the consequences provided by sub-section (2) of section 89-B. The intent is never to nullify the transactions as is apprehended. These amendments have been brought in bearing in mind the recommendations of the Law Commission of India contained in its 178th Report. 54. Thus, the learned Advocate General was supportive of the amendments and invited our attention to the scheme of both the Maharashtra Stamp Act, 1958 and the Registration Act, 1908. Alternatively and without prejudice he would submit that in the event this Court is of the view that sub-section (3) of section 30A which provides for penalty is harsh and that imposition may be excessive, this Court may read down the provision to the effect that imposition of penalty is not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the petition in the form in which it is presented and filed. Mr. Aney would submit that barring some individuals all the petitioners before this Court are corporate entities / companies / banks / financial institutions. They are artificial persons. No such entity enjoys any fundamental freedom, much less under Article 19(1) (g) of the Constitution of India. That is assured and guaranteed to citizens. A corporate entity cannot be said to be a citizen and, therefore, it is bereft of any such right and freedom. In such circumstances the petition ought to be dismissed even now on this ground. Assuming without admitting that banks and financial institutions have approached this Court relying on the mandate of Article 14 of the Constitution of India, even then they have never been discriminated against and nothing that the law does not envisage or provide for is called upon to be performed or discharged by them. Their banking business is unaffected and untouched. None interferes with the same, much less the State Government. It is their banking business which has resulted in multiple instruments being executed or brought in the State. It is such instruments which are openly and brazenl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot be stamped but non giving of the notice resulting in the drastic consequences under sub-section (2) of section 89-B and destroying the second mortgage or subsequent transaction completely that such a provision cannot find place in the Registration Act, 1908, or in the scheme thereof. Having travelled much beyond that, it deserves to be struck down. 58. With regard to the amendments to the Maharashtra Stamp Act, Mr. Tulzapurkar reiterates his submissions made in the opening and additionally contends that if the statement of objects and reasons is perused it would be evident that banks and financial institutions are singled out. It is not that the revenue remains outstanding only because of these entities or persons. How the object and purpose of collection of revenue and facilitating the same would be achieved by incorporation and insertion of section 30A of the Maharashtra Stamp Act, 1958, is not clarified at all. It is, therefore, evident that people similarly situated have not been treated similarly. The individuals, mutual funds, insurance companies are left out though they can safely be brought in the purview of the broad term corporates . Hence the banks hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lause (b) as under : 2. Definitions (a) (b) banker means an association, a company or a person who accepts, for the purpose of lending or investment, deposits of money from the public, repayable on demand or otherwise and withdrawable by cheque, draft, order or otherwise; 64. A bare perusal thereof would indicate as to how any person, association or a company accepting for the purpose of lending or investment deposits of money from the public and repayable on demand or otherwise and withdrawable by cheque, draft, order or otherwise is a banker. Though the word is defined like this, section 30A employs the phraseology in the marginal note financial institution and in sub-section (1) that expression is understood as a Bank, Non-Banking Finance Company, Housing Finance Company or alike. Hence, we cannot construe section 30A with the aid of the definition of the term 'banker' for financial institutions are performing diverse functions and discharging various obligations, including acceptance for the purpose of lending and investment, deposit of money from the public. However, their activities and functions are not restricted to this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e State Government may, by notification in the Official Gazette, appoint in this behalf; (h) duly stamped as applied to an instrument means that the instrument bears an adhesive or impressed stamp of not less than the proper amount and that such stamp has been affixed or used in accordance with law for the time being in force in the State; (i) executed and execution used with reference to instruments, mean signed and signature . (k) impressed stamp includes,- (i) labels affixed and impressed by the proper officer; (ii) stamps embossed or engraved on stamped paper; (iii) impression by franking machine; (iv) impression by any such machine as the State Government may, notification in the Official Gazette, specify; (v) receipt of e-payment; (l) instrument includes every document by which any right or liability is, or purports to be created, transferred, limited, extended, extinguished or recorded, but does not include a bill of exchange, cheque, promissory note, bill of lading, letter of credit, policy of insurance, transfer of share, debenture, proxy and receipt. 69. The submissions are b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t indicated in Schedule 1 as the proper duty therefor respectively, that is to say- (a) every instrument mentioned in Schedule 1, which not having been previously executed by any person, is executed in the State on or after the date of commencement of this Act; (b) every instrument mentioned in Schedule 1, which not having been previously executed by any person is executed out of the State on or after the said date, relates to any property situate, or to any matter or thing done or to be done in this State and is received in this State; Provided that a copy or extract, whether certified to be a true copy or not and whether a fascimile image or otherwise of the original instrument on which stamp duty is chargeable under the provisions of this section, shall be chargeable with full stamp duty indicated in the Schedule 1 if the proper duty payable on such original instrument is not paid. Provided further that no duty shall be chargeable in respect of- (1) any instrument executed by or on behalf of, or in favour of , the Government in cases, where, but for this exemption, the Government would be liable to pay the duty chargeable in respect of such ins ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t appears section 10 which deals with how to pay duty. Section 10A provides for duties to be paid in cash, by demand draft or by pay order by Government controlled bodies, insurance companies and banks. Section 10B obliges stock exchange etc. to deduct stamp duty from trading member's account. Section 10C deals with duties to be paid in cash or by demand draft or by pay order by Notary. Section 10D which is then questioned and challenged in this petition reads as under : 10D. Certain departments, organisations, institutions etc., to ensure payment of stamp duty (1) Notwithstanding anything contained in this Act, the State Government may, by notification in the Official Gazette, direct that any State Government Department, institution or local self-Government, semi Government organization, banking or non-banking financial institution or the body owned, controlled or substantially financed by the State Government or any class of them, shall ensure that the proper duty is paid to the State Government through Government Receipt Accounting System (G.R.A.S.) in respect of such instruments, as may be specified in the notification passing through their system or related t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in section 30 can be paid by the above modes and one of which is demand draft or pay order. 77. Section 10A has been inserted by the same Act so as to enable the State Government to issue a notification directing the bodies owned or controlled by the State or Central Government, Insurance Companies, Nationalized Banks, that the duty may be paid by their Head Office, Regional Office or Zonal Office by way of cash or by demand draft or by pay order in the manner further specified therein and eventually to carry an endorsement as set out in section 10A. Therefore, this provision has been inserted only to facilitate the bodies owned and controlled by the State or Central Government, Insurance Companies and Nationalized Banks to pay duty either through their Head Office, Regional Office or Zonal Office by way of cash or by way of the mode specified in section 10A. This could certainly, therefore, not be challenged and similarly the banks are not concerned with the obligation of the Stock Exchange etc. as set out in section 10B and duty to be paid in cash or by demand draft or by pay order by notary. These sections, namely, sections 10A and 10C are opening with the words Notwithsta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould have to be performed and discharged. It is only ensuring proper duty being paid to the State Government through a system which is to be availed of only after the regulatory regime is put in force by the Chief Controlling Revenue Authority. We do not find, therefore, any substance in this challenge of the petitioners. We do not think that Mr. Tulzapurkar is right in complaining that the banks would have to undertake any function or work which is not falling within the banking business and function. We do not see any over-reaching by the State legislature, much less directing taking over of or performing any function as such. To ensure payment of proper stamp duty to the State Government in relation to such instruments as are specified and noted above would not, therefore, be said to be unconstitutional, ultra vires and illegal. 79. Then we come to the further sections of Chapter II, namely section 11 and which are pertaining to use of adhesive stamps; section 12 - cancellation of adhesive stamps and by section 13, what we find is that instruments stamped with impressed stamps have to be written in such manner that the writing may appear on the face and if required on the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se of providing the proper stamp shall be borne;- (a) in the case of any instrument described in any of the following articles of Schedule I, namely- No.2 (Administration Bond); No.6 (Agreement relating to Deposit of Title-deeds, Pawn or Pledge), No.12 (Bond), No. 14 (Bottomry Bond), No. 28 (Customs Bond), No. 33 (Further Charge), No. 35 (Indemnity Bond) No. 40 (Mortgage Deed), No. 52 (Release), No. 53 (Respondentia Bond), No. 54 (Security Bond or Mortgage Deed), No. 55 (Settlement) No.59(a) Transfer of debentures, being marketable securities whether the debenture is liable to duty or not, except debentures provided for by section 8 of the Indian Stamp Act, 1899. No. 59(b) Transfer of any interest secured by a bond or mortgage deed or policy insurance), by the person drawing or making such instrument; (b) in the case of a conveyance (including by a conveyance of mortgaged property) by the grantee; in the case of a lease or agreement to lease by the lessee or intended lessee; (c) in the case of a counter part of a lease by the lessor; (d) in the case of an instrument of ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... referred to in the above clauses of section 30 is executed on or after the commencement of the Maharashtra Tax Laws (Levy and Amendment) Act, 2013, in favour of or by any financial institution which creates any right in favour of any such financial institution then the liability to pay proper stamp duty shall be on the financial institution concerned without affecting its rights, if any, to collect it from the other party. 85. We do not see how this is an impediment on the right to carry on banking business or any trade, occupation and profession within the meaning of sub-clause (g) of clause (1) of Article 19 of the Constitution of India. It is only after the Amendment Act that this liability comes on to the bank / financial institution. Further, it is restricted to the instruments of the above nature, namely, in favour of or by any financial institution such as bank etc. and which create any right in favour of such financial institution. No difficulty, much less of any insurmountable nature can be experienced when in only limited number of instruments the liability to pay the stamp duty is on the bank / financial institution, but without affecting its corresponding right to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the financial institutions to rely upon and enforce these instruments and the transactions and deals evidenced thereby are not affected at all. Once the duty is paid the instrument can be tendered and relied on in legal proceedings. The hurdle or obstacle to admissibility on this ground is removed. Thus, the banks / financial institutiions are in a way benefited by this statutory arrangement. 86. Mr. Tulzapurkar laid heavy emphasis on the ground that it is unreasonable and irrational having no nexus with the object sought to be achieved. He has complained that there are no materials produced or placed before this Court and the statement of objects and reasons is completely silent on this aspect. We do not think that the statement of objects and reasons is silent for there is a clear indication therein that to facilitate and rather accelerate collection of revenue, namely, stamp duty that this provision is enacted. It subserves larger public interest and works for public good. Lest everybody forgets, taxes are not imposed only to collect revenue but, to reduce inequality. In the case of Sri Srinivasa Theatre Ors. vs. Government of Tamil Nadu Ors. AIR 1992 SC 999, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... form all the institutions of the national life. (2) The State shall, in particular strive to minimise the inequalities in income, and endeavour to eliminate inequalities, in status, facilities and opportunities, not only amongst individuals but also amongst groups of people residing in different areas or engaged in different vocations. 11. The instrument of taxation is not merely a means to raise revenue in India; it is, and ought to be, a means to reduce inequalities. You don't tax a poor man. You tax the rich and the richer one gets, proportionately greater burden he has to bear. Indeed, a few years ago, the Income Tax Act taxed 94p out of every rupee earned by an individual over and above Rupees one Lakh. The Estate Duty Act, no doubt since repealed, Wealth Tax Act and Gift Tax Act are all measures in the same direction. It is for the reason that while applying the doctrine of classification-developed mainly with reference to and under the concept of equal protection of laws - Parliament is allowed more freedom of choice in the matter of taxation vis-a-vis other laws. If this be the situation in the case of direct taxes, it should be more so in the case of in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... axation law is discriminatory or not it is necessary to bear in mind that the State has a wide discretion in selecting persons or objects it will tax, and that a statute is not open to attack on the ground that it taxes some persons or objects and not others; it is only when within the range of its selection, the law operates unequally, and that cannot be justified on the basis of any valid classification, that it would be violative of Article 14. It is well settled that a State does not have to tax everything in order to tax something. It is allowed to pick and choose district, objects, persons, methods and even rates for taxation if it does so reasonably. 13. Similarly, it was observed in the other case by one of us (Venkatachaliah, J.): It is now well settled that a very wide latitude is available to the legislature in the matter of classification of objects, persons and things for purposes of taxation. It must need to be so, having regard to the complexities involved in the formulation of a taxation policy. Taxation is not now a mere source of raising money to defray expenses of government. It is a recognised fiscal tool to achieve fiscal and social objectives. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y what may be gathered from what the legislature has itself said. We have mentioned the facts as found by us and we do not think that there has been any infringement of the right guarantee by Article 14. (Sanjeev Coke Manufacturing Company v. Bharat Cooking Coal Ltd. Anr., [1983] 1 S.C.R. 1000 at 1029). 15. We shall first examine whether it was not competent for the Tamil Nadu Legislature to declare that the theatres situated within the five kilometer radius (belt) of the municipal corporation areas and the areas of special grade municipalities shall be subjected to the same method of taxation as the theatres situated within the said area ? It is true that the Act adopts the local areas declared under the Tamil Nadu Municipal Corporation Act, Tamil Nadu Municipalities Act and Tamil Nadu Gram Panchayats Act as the basis or prescribing the rate of taxation. But it must be remembered that it was not obligatory upon the legislature to do so. It could have adopted any other basis. It is only for the sake of convenience that the existing local areas, convenient existing units of reference, were adopted. It is not a question of power but one of the convenience. There wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y recovery of Government revenue or tax. The target is not the entities but the instruments of a particular category or class. The power to do all the above in matter of collection of tax is not questioned nor challenged. Neither is the competence of the State in enacting or amending the Stamp Act, a State law. All the arrangements overlook the underlying thread passing through section 30-A. There is no burden imposed and of such magnitude which would enable us to hold that any fundamental freedom guaranteed by the Constitution is taken away. That is neither taken away nor adversely affected by making the banks / financial institutions responsible and in equal measure with the State to recover the tax. The assistance sought from them subserves the larger public interest and public good. There is no restriction on the banking and financial business by enacting the above referred measures. So considered, the challenge must fail. 89. We repeatedly questioned the learned counsel as to how there is any prejudice, much less serious and for the banks and financial institutions as a whole or such loss which has compelled them to raise the challenge. Beyond submitting that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in all cases is also without merit. The Act has clearly set out that the instrument ought to be in favour of or by any financial institution such as bank etc. and creating any right in favour of any such institution. For ascertaining that, the instrument will speak for itself. Even otherwise, the definition of the term instrument appearing in section 2(l) of the Maharashtra Stamp Act includes every document by which right of liability is created or purported to be created. Therefore, the definition is a sufficient guide and so long as any document is a instrument chargeable to stamp duty in terms of the schedule, then, nothing else is required to be looked into. Its nomenclature would guide the banks / financial institutions and thereafter the clauses or sub-clauses of the written instrument would denote the complete transaction. The instruments are already specified in the statute vide clauses (a) to (g) in section 30. There is no need to interpret the writing or its clauses. A broad identity such as agreement acknowledging the debt mortgaging the property to secure it or securing it by other modes is enough to understand the legislative prescription. Once one of the instrume ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uted before the date of commencement of the Amendment Act, 2013. There, if the instrument is effective and where proper stamp duty is not paid, then, there is no liability on the financial institution to pay, but there is an obligation to impound such instrument and forward the same to the Collector for recovery of stamp duty. This is a power, but not a liability. The past instruments and which are effective but stamp duty on which remained unpaid then the proper stamp duty has to be recovered. That is not going to be recovered by the bank and financial institution and no obligation is cast as regards the same. Rather, it is a power to impound such instrument and forward the same to the Collector for recovery. Even this is challenged on the ground that banks / financial institutions would have to determine whether the instrument is effective and what is the proper stamp duty which is not paid. This is termed as a requirement of undertaking of an adjudication or exercising quasi judicial power. We are unable to see any force in such contentions either. The plain dictionary meaning of the term effective is operative, existing in fact though not formerly acted as such. Therefor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s proof of stamp duty being paid, then, everything else rests with the Collector to whom it is forwarded for recovery. One who is aggrieved by any such act of the bank has enough protection and remedies available to him within the statute. The bank need not worry about the legality and validity of its act. However, before the impounding of the instrument or because of the fact that the instrument is fairly old there was a delay in impounding or some such reason which is genuine and bona fide the bank is unable to perform the function or exercise the power conferred on it, then, it can,depending upon other facts and circumstances, urge that no penalty be levied in terms of sub-section (3) of section 30A for there is no failure to impound the instrument. The complaint that the penalty follows automatically is the one which requires to be dealt with and that is equally without any merit. The moment sub-section (3) talks of penalty and liability to pay a penalty, then all the principles which go into imposition of a penalty would be applicable. In this case, the penalty is a civil liability. It would be imposed for some deliberate and intentional act. The word 'failure' itself ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Dictionary meaning of which has been applied means to take legal or formal possession of the instrument. In the present case, the word is understood in the sense that once the condition as above is satisfied the banks / financial institutions are obliged to take the instrument in their custody or possession. The recovery will be by the authority competent to do so by the Maharashtra Stamp Act, 1958. The bank is not concerned with the further steps at all. 96. We do not see, therefore, any substance in the complaint or the ground raised that this act and which is specified in sub-section (2) of section 30A would necessitate carrying out the same exercise as is contemplated by Chapter IV titled Instruments not duly stamped. As held above therein appear sections 33, 33A and 34. 97. The impounded instruments have to be dealt with in terms of section 37. In the case before us the banks or financial institutions have merely to look at the instrument and if it is effective and where proper stamp duty is not paid then the financial institution shall impound such instrument and forward the same to the Collector for recovery. Its failure to impound such instrument as provided in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... how any argument of this nature can be the foundation of a complaint of inequality or violation of the mandate of Article 14 of the Constitution of India or the State treating the petitioners and other banks and financial institutions differently without any legal basis. If other wrongdoers or others who are equally responsible and obliged to perform a duty are not brought in the net of the statute or purview of a statutory provision by itself and without anything more cannot be discrimination or inequality within the meaning of Article 14. It would mean all those who have failed to perform and discharge a public function or public duty are a class as a whole and somebody being picked up from them means negation or violation of the mandate of equality enshrined by Article 14 of the Constitution of India. It has been repeated on several occasions by the Hon'ble Supreme Court that Article 14 which speaks of the right to equality and equal protection of laws or in other words equality before law and equal protection of laws is a positive concept. It is not a negative one. Hence, it cannot be founded on a plea that one wrongdoer or a defaulter goes scot free or benefits by any ina ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... equisite steps and care then its interest would be protected. If in a wider sense such provisions also enable protection of public money, then, we do not see why Nationalized banks all the more have come forward to challenge them. In such circumstances, the entire foundation of the argument being legally untenable, the same must be rejected. The senior counsel ought to be aware of the principles emerging from the three Judge Bench judgment of the Hon'ble Supreme Court of India in the case of Hindustan Steel Ltd. vs. Dilip Construction Company, reported in AIR 1969 SC 1238. The Hon'ble Supreme Court held thus : 4. An instrument which is not duly stamped cannot be received in evidence by any person who has authority to receive evidence, and it cannot be acted upon by that person or by any public officer. Section 35 provides that the admissibility of an instrument once admitted in evidence shall not, except as provided in Section 61, be called in question at any stage of the same suit or proceeding on the ground that the instrument has not been duly stamped. Relying upon the difference in the phraseology between Section 35 and 36 it was urged that an instrument ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase of mortgage by depositing title deeds and provisions for compensation in favour of subsequent transferee. - (1) Every person who has mortgaged immovable property by way of a mortgage by depositing title deeds under clause (f) of section 58 of the Transfer of Property Act, 1882 (IV of 1882) shall, within thirty days from the date of the mortgage, file a notice of intimation of his having so mortgaged the property, giving details of his name and address, name and address of the mortgagee, date of mortgage, amount received under the mortgage, rate of interest payable, list of documents deposited, and description of the immovable property in the manner required by section 21, to the registering officer within the local limits of whose jurisdiction the whole or any part of the property is situate, and the said officer shall file the same in his Book No. 1: Provided that, if the property so mortgaged falls within the jurisdiction of more than one registering officer, the procedure specified in this sub-section shall be followed in respect of the property within the jurisdiction of each of such officers. (2) If, the person who has mortgaged the property as aforesa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om being defrauded by people who have no connection with the property. I say that this intention behind the law of Registration can be gleaned from the object of the one of the earliest legislations on the subject, i.e., Regulation XXXVI of 1793, which was passed by the Governor General in Council on 1st May 1793. Its object was to give security to the titles and rights of persons purchasing real property or receiving such property in gift, or advancing money on the mortgage of it, or taking it on lease or other limited assignment; to prevent individuals being defrauded by buying, or receiving in gift, or lending money on mortgage, or taking on lease any such property that may have been so previously disposed of or pledged; to afford persons the means of obviating as far as may be practicable, litigation respecting the authenticity of their wills, or any written authority they may grant to their wives to adopt sons after their death; and that individuals may be able to provide against any injury to their rights or property, by the loss or destruction of deeds relating to transactions of the nature of those above specified. 27. I therefore say that it is important to regist ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sale certificate issued by a competent officer or authority under any recovery act, irrevocable Power of Attorney relating to transfer of immovable property in any way, executed on or after the commencement of the amended Act (Maharashtra Amendment) Act, 2010 (Mah.X of 2012) requires compulsory registration. That is not challenged admittedly. Section 89-A is also not challenged which is dealing with copies of court decrees, attachment orders etc. to be sent to the registering officers and filed therein. Section 89-B speaks of an act of any person who has mortgaged immovable property by way of deposit of title deeds under clause (f) of section 58 of the Transfer of Property Act, 1882, shall, within thirty days from the date of the mortgage, file a notice of intimation of his having so mortgaged the property and thereby giving details as are set out in subsection (1) of section 89-B. These details have to be given in the manner required by section 21 to the registering officer within the local limits of whose jurisdiction the whole or any part of the property is situate. The obligation of the officer is then to file the same in Book No.1. If the jurisdiction of more than one registe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in an individual and given case that the conditions set out in sub-section (2) are not satisfied or not attracted at all. Even the substantive law namely the Transfer of Property Act, 1882 must be looked at before any conclusion is reached or drawn. We do not see how Mr. Tulzapurkar's extreme argument would shut out such contentions. We do not read the words and expressions such a transaction shall be void in an isolated manner. These would have to be read with the preceding words and expressions for it is well settled that not only a section, but parts of the section, a sub-section would have to be read together and no looked at in isolation or torn from the context. Therefore, applying these principles of interpretation and if one looks at the provision and read every part of it together and harmoniously not only with other sub-sections of the same section but the entire statute itself then it is possible to make a consistent whole of the enactment. It is only that transaction which is void or such transaction which is void which is of the nature referred to by the preceding words. Therefore, to raise a general and vague contention that all second mortgages or subsequent m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are numbered. (3) Other houses and lands shall be described by their name, if any, and as being the territorial division in which they are situate, and by their superficial contents, the roads and other properties on to which they abut, and their existing occupancies, and also, whenever it is practicable, by reference to a Government map or survey. (4) No non-testamentary document containing a map or plan of any property comprised therein shall be accepted for registration unless it is accompanied by a true copy of the map or plan, or, in case such property is situate in several districts, by such number of true copies of the map or plan as are equal to the number of such districts. 108 A bare perusal of sub-sections (1) to (4) of this section would reveal as to how there should be description of property by maps or plans and no non-testamentary document relating to immovable property shall be accepted for registration unless it contains a description of such property sufficient to identify the same. Then, the requirement set out in the sub-sections of this provision are to be complied with. Section 22 deals with description of houses and land by reference to G ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... registered shall- (a) affect any immovable property comprised therein, or (b) confer any power to adopt, or (c) be received as evidence of any transaction affecting such property or conferring such power, unless it has been registered: Provided that an unregistered document affecting immovable property and required by this Act or the Transfer of Property Act, 1882 (4 of 1882), to be registered may be received as evidence of a contract in a suit for specific performance under Chapter II of the Specific Relief Act, 1877 (3 of 1877) or as evidence of any collateral transaction not required to be effected by registered instrument. 110 A perusal of these two provisions would indicate that all non testamentary documents duly registered under the Registration Act and relating to any property, whether movable or immovable, shall take effect against any oral agreement or declaration relating to such property, unless where the agreement or declaration has been accompanied or followed by delivery of possession and the same constitutes a valid transfer under any law for the time being in force. The proviso to section 48 is very important and that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... first day of July 1871, not registered under the Indian Registration Act, 1871. (8 of 1871), or the Indian Registration Act, 1877 (3 of 1877), or this Act. 111 A bare perusal of section 50 would also reveal that certain registered documents relating to land to take effect against unregistered documents but that document should not be a decree or order. Obviously decree or order would be a decree or order of a court. Therefore, when the State of Maharashtra introduced section 89-A we must not lose sight of the distinction which we have noted above. Section 89-A states that the copies of the court decrees, attachment orders etc. to be sent to registering officers and filed in registers. Then, section 89-B talks of notice to be sent to registering officers by mortgagor in case of a mortgage by deposit of title deeds and provisions for compensation in favour of subsequent transferee. If documents which are compulsorily registrable are not registered and yet the rigour of section 49 is relaxed by the provision itself and prior provision section 48, then, we do not see how mere non filing of a notice of intimation in respect of a mortgage by deposit of titledeeds but not evidence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sub-section (2) of section 89-B of the Registration Act, 1908 as an over-riding provision would be erroneous in law. It is not, therefore, possible to accept the argument that sub-section (2) of section 89-B to the extent above is ultra vires the mandate of Article 14 and 300A of the Constitution of India so also the Transfer of Property Act, 1882. We are of the opinion that this provision would have to be read with the other sections and provisions of the Registration Act and harmoniously. It would also have to be read together with the Transfer of Property Act and to the extent it permits a mortgagor to deal with the mortgaged property or enter into any transaction in relation to or affecting the immovable property which is the subject matter of the mortgage with a third party. Once the substantive law, namely, the Transfer of Property Act, 1882, does not contain any limiting or restricting provision, then, by relying on the phraseology of sub-section (2) of section 89-B above we cannot strike it down. 112 We must, in this behalf, not lose sight of the principles of statutory interpretation and an interpretation must be placed mindful of the consequences. If the conseq ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as a whole and one provision of the Act should be construed with reference to the other provisions in the same Act so as to make a consistent enactment of the whole statute. Such a construction has the merit of avoiding any inconsistency or repugnancy either within a section or between a section and other parts of the statute. It is a duty of the courts to avoid a head-on clash. It should not be lightly assumed that the Parliament had given with one hand what it took away from the other. Hence the provisions of one section of the statute cannot be used to defeat those of another, unless it is impossible to effect reconciliation between them. All these principles and which are enunciated in this work from pages 131 to 145 with the aid of decided cases can safely be applied. 115 Thus a construction unmindful of or in disregard to the consequences is not permissible. 116 The last principle and which we have often applied, namely, of strict construction or construction of mandatory and directory provisions. As far as the latter principle is concerned, the same learned author has in that very work outlined that principle in the following words : If by holding a provis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ave been interpreted as not operating by their own force. Its mere use is not determinative of the legal impact. In AIR 1996 SC 906 (State of Kerala vs. M.S.Nambiar) interpreting these words in the context of section 83 of Kerala Land Reforms Act, the Hon'ble Court held as under : 5. Will the observations made in C.R.P. 3440 of 1977 to the effect that the S. . proceedings without intimation by the Board under Section 85(7) of the Kerala Land Reforms Act Act render such proceedings void , effect the legality or validity of the proceedings which culminated in C.R.P. 3440 of 1977? 6. It is not necessary for us to go into the merits of the case. We are of the view that the order passed inter parties in C.R.P. 3440 of 1977 dated 2.11.1977, has become final, and it concludes the matter. The observations made in the proceedings. at the instance of the 1st respondent regarding the validity of the order of the Board, in C.R.P. 3696 of 1977. will not, in any way, effect the legality and validity of the proceedings declining to implead respondents No. 3 and 4 or the order passed in Revision therefrom- C.R.P. 3440 of 1977. It is true that the proceedings dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at pages 341-342:- ....every unlawful administrative act, however invalid, is merely voidable. But this is no more than the truism that in most situations the only way to resist unlawful action is by recourse to the law. In a well-known passage Lord Raodliffe said: An order, even if not made in good faith, is still an act capable of legal consequences. It bears no brand of invalidity upon its forehead. Unless the necessary proceedings are taken at law to establish the cause of invalidity and to get it quashed or otherwise upset, it will remain as effective for its ostensible purpose as the most impeccable of orders. This must be equally true even where the brand of invalidity is plainly visible: for there also the order can effectively be resisted in law only by obtaining the decision of the court. The necessity of recourse to the court has been pointed out repeatedly in the House of Lords and Privy Council without distinction between patent and latent defects. The above statement of the law supports our view that the order of the Board dated 28.6.1977, declining to implead respondents No. 3 and 4 (which stood confirmed in Revision) concludes the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hough there is no difference in effect, there may be substantial difference in what bring about the effect. A void sale need not be set aside. A sale that required to be and is set aside is as ineffective as a void sale. There is nothing in what is void and a void Act need no repeal. Whether the word void is treated to the Latin form Viduus meaning bereft as some do or to the Latin form Vacare meaning to be empty, the word connotes emptiness, a vacuum or a nullity. Repealing denotes withdrawing something which is in existence (re., back, apeler, appeler to call-Chambers Twentieth Century Dictionary). To me it looks that to say that a law is inoperative is to say something less than to say that an Act is repealed. Any way, the two ideas are different. The word 'void' may not have its full force and effect when it is used in an enactment for the benefit of particular persons and understood as 'voidable' at the election of those persons but when it relates to persons not capable of protecting themselves or when it as some object of public policy which requires the strict construction, the word receive its full force and effect, as observed by Maxwell's Inte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f equality enshrined in the Constitution. 124 In the view that we have taken, we need not refer to all the judgments which have been cited by the learned Advocate General. 125 As a result of the above detailed discussion, we find no merit in the Writ Petition. It is dismissed. There shall be no order as to costs. 126 After the judgment was pronounced, Mr. Samdani and Mr. Kamdar, learned counsel appearing for the respective parties pray that there is an interim order and operating in this petition since 2013. The effect of that is that the obligation to comply with sub-section (2) of section 30-A of the Bombay Stamp Act, 1958 is postponed. 127 Since the respondents have not taken steps in pursuance of the further provision, namely, sub-section (3), the request is that time be granted to comply with the statutory obligation which, as it is, stands postponed. 128 This request is opposed by Ms. Shastri appearing for the respondent Nos.1 to 3. 129 Having heard learned counsel on this point we are of the view that the compliance with the statutory obligation may be made by the petitioner and the respective banks / financial institutions by 1st July, 2016. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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