Published on: November 08, 2023 at 00:03 IST
Court: Supreme Court of India
Citation: Hindustan Steel Ltd. V. Dilip Construction Co. (1969)
Honourable Supreme Court of India has held that Indian Stamp Act 1899 is a fiscal measure enacted to secure revenue for the State on certain classes of instruments. It is held that the Arbitration Award is an instrument against which Stamp Duty is duly required to be paid by the litigants. It is held that the object of the Stamp Act is to secure revenue for the State in accordance with the law.
It is held that Section 35 of the Stamp Act operates as a bar to an unstamped instrument being admitted in evidence or being acted upon and are required to be duly impounded under the aegis of Section 40 of the Stamp Act. It is held that the Section 42 of the Stamp Act duly provides for certification by the Collector of the Stamp that an instrument is duly stamped and consequences resulting from such certification.
6. Relying upon the difference in the phraseology between Sections 35 and 36 it was urged that an instrument which is not duly stamped may be admitted in evidence on payment of duty and penalty, but it cannot be acted upon because Section 35 operates as a bar to the admission in evidence of the instrument not duly stamped as well as to its being acted upon, and the Legislature has by Section 36 in the conditions set out therein removed the bar only against admission in evidence of the instrument. The argument ignores the true import of Section 36.
By that section an instrument once admitted in evidence shall not be called in question at any stage of the same suit or proceeding on the ground that it has not been duly stamped. Section 36 does not prohibit a challenge against an instrument that it shall not be acted upon because it is not duly stamped, but on that account there is no bar against an instrument not duly stamped being acted upon after payment of the stamp duty and penalty according to the procedure prescribed by the Act.
The doubt, if any, is removed by the terms of Section 42(2) which enact, in terms unmistakable, that every instrument endorsed by the Collector under Section 42(1) shall be admissible in evidence and may be acted upon as if it has been duly stamped.
Drafted By Abhijit Mishra