IN THE HIGH COURT OF DELHI AT NEW DELHI
Present: Mr. Rajiv Mehra, Sr. Advocate with Mr. Sanjay Bhatt and Ms.
Priya pathania, Advocates for the petitioner.
Mr. A.S. Chandhiok, ASG with Mr. Sachin Duta, Mr. S. Bajaj, Mr.
Gurpreet S. Parwanda and Ms. Riya Kaul, Advocates for the respondent/UOI.
The petitioner had raised the claims against the respondents in
the sum of ` 1325 crores. An Arbitrator was appointed to tackle those
claims. The said Arbitrator passed ?Nil? award rejecting all the claims
of the petitioner. Challenging the award, the petitioner has filed this
OMP under Section 34 of the Arbitration and Conciliation Act, 1996.
When this petition came up for hearing before the Ld. Single Judge,
the learned Single Judge suo moto took the note of an issue pertaining
to the requisite stamp duty and applicable penalty arising for
consideration. On the basis of reading of the provisions of Article 12
and 15 of the Stamp Act, the learned Single Judge opined that the award
has to be stamped @ 2% of the value of the claims preferred by the
claimants irrespective of whether the claims were ultimately awarded. On
this score, an opinion was expressed by the learned Single Judge that
the award should have been on stamp paper of ` 26.5 crores and as the
petitioner had failed to provide necessary stamp paper to the Arbitrator,
the petitioner was also liable to pay penalties which could go up to
ten times of the aforesaid stamp duty. Thereafter, the learned Single
Judge proceeded to discuss as to whether the award could be impounded
and sent to the Collector of Stamps qua payment of adequate duty and
In the process, the learned Single Judge took note of the judgment
of Supreme Court in the case of M. Anasuya Devi and Anr. Vs. M. Manik Reddy
and others, (2003) 8 SCC 565, as per which the Court has no power to
impound insufficient or unstamped documents under Section 33 of the
Stamp Act, if the Court seeks suo moto exercise of power. The learned
Single Judge has questioned the legality of the said judgment and
according to the learned Single Judge it goes contrary to the decision
of Supreme Court in the case of N. Bhargavan Pillai Vs. State of
Kerala, 2004 (13) SCC 217. The learned Single Judge has found that
these are important issues which arise for consideration and the same
should be decided by a Larger Bench. On this premise, as many as five
issues are referred for consideration This is how the matter is placed
before this Bench.
Simultaneously the matter was forwarded to the Collector of Stamp
as well for passing necessary orders.
During the pendency of this Reference, direction was given to the
Collector of Stamp by this Bench to pass appropriate orders. Pursuant thereto, orders dated 31st March, 2001 have been passed by the Collector
of Stamp who has opined that in view of the Division Bench judgment of
this court in M/s Rajasthan Builder Vs. Union of India etc. (FAO (OS)
46/1971) the arbitration award has to bear the stamp duty with
reference to the amount awarded and not the amount claimed.
We have summoned the file of FO(OS) 46/1971 and have gone through
the judgment dated 1st September, 1980 rendered in the aforesaid FAO
(OS). Having regard to the same provisions namely Article 12 and 15 of
schedule 1 of the Stamp Act and considering the import thereof, the
Division Bench has concluded that the stamp duty is to be calculated on
the amount awarded and not the amount claimed. The operative portion of
the said order reads as under:-
?Another objection raised was that the stamp paper did not bear a proper
stamp. Item 12 of Schedule I to Stamp Act provides that where the amount
of award does not exceed `1,000/- the same duty as Bond (No.15) for such
amount is to be paid. Now item 15(bond) provides that where the amount
or value does not exceed `10.2 annas stamp is to be paid. In the present
case no amount has been awarded, and a stamp of even 2 annas would have
been sufficient. Mr. Aggarwal of course, however, suggests that as the
claim of the appellant was over a lakh of rupees the stamp duty should
have been calculated on that amount. We find the argument unacceptable.
The award has to bear the stamp duty with reference to the amount awarded
and not the claimed amount. Award was therefore property stamped.?
The learned Single Judge making Reference did not consider the
aforesaid Division Bench judgment of this Court which binds this Bench as
well. In view thereof, when the legal position is that stamp duty is to
be paid on the amount awarded and not on the amount claimed, the
questions framed by the learned Single Judge for Reference become
academic and need not be answered. Insofar as the present case is
concerned, the matter is remitted back to the learned Single Judge for
deciding the OMP on merits.
The party shall appear before the learned Single Judge on 28th
SEPTEMBER 14, 2011