NON-REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO(S).  8198-8199 OF 2019 (ARISING OUT OF SLP(C ) NO(S). 19774-19775 OF 2017)

M/S TERAI TEA COMPANY LIMITED       ….APPELLANT(S)

VERSUS

KUMKUM MITTAL & ORS.              ….RESPONDENT(S)

J U D G M E N T

Rastogi, J.

1. Leave granted.

2. These appeals are directed against the order dated 13th

April, 2017 passed by the Division Bench of the High Court of

Calcutta directing the suit Court to impound the document (dt.

15th January, 1990) and take appropriate steps in accordance

with law for the assessment of the stamp duty, penalty and the

like thereon.

3. The brief facts of the case are that one Dhirendra Nath

Bhowmick  (since  deceased),  as  the  sole  proprietor  and

perpetual lessee had agreed to sell a tea estate namely, M/s.

Dharanipur Tea Estate comprising of a tea garden measuring

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about 1140.59 acres in favour of the appellant-plaintiff along

with all the liabilities on a consideration of Rs. 10,11,000/- and

he executed an agreement to sell to that effect on 15th January,

1990  after  accepting  a  part  consideration  amount  of  Rs.

2,11,000/-.  Dhirendra Nath Bhowmick failed and/or neglected

and/or refused to fulfil his obligations under the said agreement

to  sell  dated  15th January,  1990,  by  not  executing  and

registering the Deed of conveyance within the time specified,

despite the appellant-plaintiff being fully ready and willing to

discharge  its  part  of  obligations  including  the  payment  of

balance consideration amount on or before 15th March,1990.  

4. The  appellant-plaintiff filed  the  suit  for  specific

performance of the agreement before the High Court.  In the

said suit, an application for interim injunction was refused by

the Single Judge vide Order dated 1st April, 1991 that came to

be challenged at the instance of the appellant in letters patent

appeal  before the Division Bench of the High Court.   During

pendency  of  the  appeal,  both  the  parties  entered  into  a

compromise and the Division Bench of the High Court vide its

order dated 2nd August, 1991 passed the consent decree in the

appeal and accordingly disposed of the Suit No. 240 of 1990

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and observed that the verbal compromise constitute the fresh

agreement as the original agreement dated 15th January, 1990

was  modified  upon  enhancement  of  consideration  from  the

original amount of Rs. 10,11,000/- to Rs. 12,11,000/-.  As the

defendant  in  the  suit  agreed  to  execute  the  deed  of

conveyance  in  favour  of  the  appellant-plaintiff,  two  drafts,

amounting to Rs. 9,00,000/- and Rs. 2,00,000/-, both bearing

dated 25th July,  1991, being the balance of the consideration

money  of  the  said  tea  estate  were  paid.   Accordingly,  late

Bhowmick executed the conveyance deed no. 11248/1991 in

favour of the appellant.  It is not disputed that the appellant

paid  full  stamp  duty  of  Rs.  1,85,000/-  on  the  deed  of

conveyance dated 3rd August, 1991.

5. It  may  be  relevant  to  notice  that  the  respondent-

defendant in the suit concealed material information that the

earlier suit no. 8 of 1984 was filed by Dhirendra Nath Bhowmick

and  his  wife  for  declaration  that  the  transfer  of  controlling

interest in the shares of M/s. The New Red Bank Tea Company

Private Ltd. was not valid and a declaration was sought that the

said Dhirendra Nath Bhowmick had all equitable right, title and

interest in respect of the said Dharanipur Tea Estate and for

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restoration of possession.  6. The  decree  for  specific

performance granted by the Court in Suit No. 240 of 1990 came

to be challenged in this Court in Civil Appeal No. 3569 of 1991

by The New Red Bank Tea Company Private Ltd. (respondent

No.  6)  impleading  the  present  appellant  and  the  interested

parties  as  respondents.   This  Court  observed that  while  the

decree of specific performance was granted by the Court in Suit

No. 240 of 1990 dated 2nd August, 1991, the earlier Suit No. 8

of 1984 pending in the High Court of Calcutta remain unnoticed

and both the suits ought to have been tried together, taking

note thereof, the decree of specific performance passed in Suit

No. 240 of 1990 for the aforesaid reason was set aside and the

High  Court  was  directed  to  dispose  of  both  the  suits  as

expeditiously as possible.  Obviously in consequence thereof,

the deed of conveyance which was executed in furtherance of

the decree of specific performance also came to be cancelled.   

7. It  is  indisputed  that  the  present  appellant  with  all

bonafides proceeded to pay the full  consideration of the suit

property  in  question  and  pursuant  to  the  decree  of  specific

performance dated 2nd August, 1991, deed of conveyance was

executed on which the required stamp duty of Rs. 1,85,000/-

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was  also  paid  but  obviously  after  the  decree  of  specific

performance  dated  2nd August,  1991  been  set  aside  by  this

Court, consequent thereto, the deed of conveyance dated 3rd

August,  1991  remain  non-existent  and  the  appellant

indisputedly was at liberty to claim refund of the stamp duty of

Rs. 1,85,000/- which was paid on the deed of conveyance dated

3rd August, 1991.

8. After Suit No. 240 of 1990 came to be restored pursuant

to  the  order  of  this  Court  dated  9th September,  1991  to  be

heard along with Suit No. 8 of 1984, at this stage application

was  filed  by  the  respondent  for  impounding  the  document

(agreement to sell dated 15th January, 1990) taking assistance

of Section 35 of the Indian Stamp Act, 1899.  The Single Judge

of  the High Court  under its  order  dated 14th February,  2017

noticed that appellant had already paid the stamp duty of Rs.

1,85,000/-  on  the  deed  of  conveyance  which  has  been

cancelled and he was at liberty to claim the refund.   In the

given circumstances,  his right of specific performance of the

agreement based on the agreement to sell dated 15th January,

1990 shall be decided as a moot question by the Court as per

the evidence to be adduced by the parties to the suit.

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9. Learned counsel for the appellant has raised submissions

questioning the maintainability of the appeal preferred against

the interim order passed by the Single Judge of the High Court

dated 14th February, 2017 in pending suit No. 240 of 1990 and

that apart submits that the appellant had paid a stamp duty of

Rs.  1,85,000/-  on  the  deed  of  conveyance  but  after  the

judgment  being  passed  by  this  Court  dated  9th September,

1991,  the  decree  of  specific  performance  dated  2nd August,

1991 and consequently deed of conveyance executed pursuant

thereto  has been cancelled but  appellant  is  entitled to  seek

refund of the stamp duty of           Rs. 1,85,000/- paid by it and

no one has disputed the same before the Division Bench of the

High Court in seeking refund of the duty paid by it.  In the given

circumstances, it remains a technical plea that the agreement

to  sell  dated 15th January,  1990 being unstamped,  it  will  be

harsh in the given facts to impound the document without the

matter being adjudicated and it was the direction of this Court

to consolidate both the suits to be heard on merits.

10. Learned counsel further submits that impounding of the

document  at  this  stage  during  pendency  of  the  suit  indeed

frustrate the very plea which he has raised in the pending suit

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and in the given circumstances, it will be unjust to non-suit the

claim of the appellant after the suit remain pending in the Court

for almost 29 years.

11. Per  contra,  learned  counsel  for  the  respondent,  on  the

other hand, while supporting the order passed by the Division

Bench of the High Court submits that recovery of stamp duty

which was paid on the deed of conveyance which the appellant

is indisputedly at liberty to recover by due process of law but

that will not give any benefit in reference to the agreement to

sell  dated  15th January,  1990  which  indisputedly  was

unstamped and in the given circumstances, the High Court has

not committed any error in impounding the document.

12. We have heard learned counsel for the parties and with

their assistance perused the material available on record.

13. The indisputed facts which can easily be discernible from

the records are that in reference to the suit property, there was

an agreement to sell dated 15th January, 1990 executed by late

Dhirendra Nath Bhowmick in favour of appellant-plaintiff for the

sale  of  tea estate  namely,  M/s.  Dharanipur  Tea Estate for  a

consideration  of  Rs.  10,11,000/-  for  which  part  payment  of

Rs.  2,11,000/-  was  made  and  since  late  Dhirendra  Nath

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Bhowmick  failed  to  fulfil  his  obligation,  suit  for  specific

performance no. 240 of 1990 at the instance of the appellant

came to be instituted.  In the said pending suit no. 240 of 1990,

since the interim injunction was refused,  appeal  came to be

preferred and during pendency of the appeal, the parties to the

proceedings entered into a compromise and the Division Bench

of the High Court vide its order dated 2nd August, 1991 granted

consent  decree  on  enhancement  of  a  consideration  from

original amount of          Rs. 10,11,000/- to Rs. 12,11,000/-.  In

sequel thereto, the deed of conveyance was executed on 3rd

August, 1991 and stamp duty of Rs. 1,85,000/- was paid by the

appellant and full consideration of Rs. 12,11,000/- was paid by

the appellant to Dhirendra Nath Bhowmick.

14. This fact was not in the notice of the appellant that prior

to filing of the suit no. 240 of 1990, earlier suit no. 8 of 1984

was  filed  by  Dhirendra  Nath  Bhowmick  and  his  wife  for

declaration that the transfer of controlling interest in the shares

of the company, namely, M/s. the New Red Bank Tea Company

Private Ltd. was not valid and a declaration was sought that he

had legal and equitable right, title and interest in respect of the

said Dharanipur Tea Estate and restoration of possession was

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pending adjudication.  The consent decree dated 2nd August,

1991 pursuant to which the deed of conveyance was executed

on 3rd August, 1991 and stamp duty of Rs. 1,85,000/- was paid

that came to be challenged in this Court by M/s. New Red Bank

Tea Company Private Ltd. who indisputedly was not party to

the proceedings  which  was  instituted  at  the  instance of  the

appellant (Suit No. 240 of 1990).

15. After the parties being heard, this Court allowed the civil

appeal under its order dated 9th September, 1991 and set aside

the consent decree dated 2nd August, 1991 on the premise that

suit no. 240 of 1990 and suit no. 8 of 1984 ought to have been

tried together and the suit for specific performance could not

have been decreed by consent without determining the legal

title and factum of possession of the suit property.  The title

and  possession  could  not  have  been  decided  without

impleading  the  respondent  M/s.  The  New  Red  Bank  Tea

Company Private Ltd. as a defendant to the suit.   By setting

aside  the  consent  decree  dated  2nd August,  1991,  in  the

consequence, the deed of conveyance dated 3rd August, 1991

also came to be cancelled and after the order of this Court in

Civil  Appeal No. 3569 of 1991 dated 9th September,  1991,  it

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reveals that M/s. the New Red Bank Tea Company Private Ltd.

has been impleaded as a defendant in suit no. 240 of 1990 filed

at the instance of the appellant and under the directions of this

Court, both the suits are clubbed and to be heard together on

merits.

16. In the peculiar facts and circumstances, where the parties

to the proceedings originally in Suit No. 240 of 1990 filed at the

instance of the appellant have consented to obtain a consent

decree  of  specific  performance  dated  2nd August,  1991

pursuant  to  which  deed of  conveyance was  executed on  3rd

August, 1991 and full stamp duty of Rs. 1,85,000/- was paid by

the appellant and no objection was raised by the respondent at

any  stage  in  reference  to  the  agreement  to  sell  dated  15th

January,  1990  in  the  suit  for  specific  performance  and  the

decree dated 2nd August, 1991 although it has been set aside

by  this  Court  at  the  instance  of  the  third  party  to  the

proceedings,  namely,  M/s.  the  New Red  Bank  Tea  Company

Private Ltd. and once the finding has been affirmed that the

appellant is entitled for refund of Rs. 1,85,000/- towards stamp

duty which was paid on the deed of conveyance, the appellant

who  has  always  shown  his  bonafides  in  transfer  of  full

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consideration  after  which deed of  conveyance was executed

and  stamp  duty  of  Rs.  1,85,000/-  was  paid  which  he  is

indisputedly  entitled  for  refund,  it  is  not  open  for  the

respondent(s) to question as they always remained consented

to  the  decree  passed  by  the  Court  dated  2nd August,  1991

which although came to be set aside at the instance of the third

party,  namely, M/s.  the New Red Bank Tea Company Private

Ltd.

17. In the facts and circumstances, it will not give any cause

of action to the respondent to raise an objection for impounding

of the document invoking Section 35 of the Indian Stamps Act,

1899 more so when the appellant had paid the stamp duty of

Rs. 1,85,000/- and is entitled for refund which indisputedly was

never  claimed.   In  our  considered  view,  in  the  facts  and

circumstances  of  the  case,  it  was  not  open  for  the  Division

Bench under the impugned judgment to set aside the order of

the  Single  Judge which was  one of  the  possible  view in  the

peculiar facts and circumstances of the case.

18. Consequently,  the  appeals  deserve  to  succeed  and  are

accordingly allowed.  The judgment of the Division Bench of the

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High Court dated 13th April,  2017 is hereby quashed and set

aside.  No costs.

19. Pending application(s), if any, stand disposed of.

………………………………………..J. (MOHAN M. SHANANAGOUDAR)

………………………………………..J. (AJAY RASTOGI)

NEW DELHI OCTOBER 22, 2019

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