Rajasthan High Court – Jaipur
Jitendra Nath Sachhar S/O Sri Sai Dass … vs Yodjraj S/O Shri Sai Dass Sachhar … on 21 April, 2026
[2026:RJ-JP:16890]
HIGH COURT OF JUDICATURE FOR RAJASTHAN
BENCH AT JAIPUR
S.B. Civil Writ Petition No. 1991/2026
1 Jitendra Nath Sachhar S/o Sri Sai Dass Sachhar, R/o
Jhalrapatan District Jhalawar (Rajasthan) (Since
Deceased) Through His Legal Heirs
1.1 Nirmala Kumari W/o Shri Jitendra Nath Sachhar, R/o
Swaran Kutti, Behind Surya Mandir, Jhalarapatan.
1.2 Arvind Kumar S/o Shri Jitendra Nath Sachhar, R/o
Jitendra Collection, Behind Surya Mandir, Jhalarapatan.
1.3 Dharmendra Kumar S/o Shri Jitendra Nath Sachhar, R/o
New Swaran General Store, Opposite Jhalawar Kendriya
Sahakari Bank, Jhalarapatan.
1.4 Smt. Anita D./o Shri Jitendra Nath Sachhar, W/o Shri
Murari Lal Adalakha, Advocate, Khedliganj, Atru, District
Baran (Raj.)
---Defendants-Petitioners
Versus
Yodjraj S/o Shri Sai Dass Sachhar, R/o Jhalarapatan, District
Jhalawar (Raj.)
---Plaintiff-Respondent
For Petitioner(s) : Mr. Mahesh Gupta
For Respondent(s) : Mr. Narendra Kumar
HON'BLE MR. JUSTICE BIPIN GUPTA
Judgment
Reportable
21/04/2026
1. The present civil writ petition has been filed assailing the
order dated 19.01.2026, passed by learned District Judge,
Jhalawar, in Civil Suit No.121/2024, whereby the application filed
by the plaintiff-respondent under Section 35 of the Indian Stamp
Act, 1899 (hereinafter referred to as “the Act of 1899”)
corresponding to Section 39 of the Rajasthan Stamps Act, 1998
(hereinafter referred to as “the Act of 1998”) read with Section
49(c) of the Registration Act, 1908 (hereinafter referred to as “the
Act of 1908”) has been allowed. The learned trial Court, while
holding that the partition agreement in question is unregistered
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and, therefore, inadmissible in evidence, directed that the said
document be impounded and placed in record in “Part D” of the
case file.
2. The brief facts of the case are that the plaintiff-respondent
instituted a suit for partition and possession of joint family
property. In response, the defendant-petitioner filed a written
statement denying the averments made in the plaint.
2.1 During the course of proceedings, the plaintiff-respondent
filed an application under Section 35 of the Act of 1899 read with
Section 49(c) of the Act of 1908, contending that the defendant
had produced a document during the plaintiff’s evidence and
sought to rely upon it in cross-examination. It was submitted that
the said document, being a partition agreement, was neither duly
stamped nor registered and, therefore, was inadmissible in
evidence. Accordingly, a prayer was made that the document
should not be exhibited until compliance with the statutory
requirements under the aforesaid provisions.
2.2 The defendant-petitioner filed a reply to the said application.
The learned trial Court, vide order dated 17.12.2016, disposed of
the application observing that mere confrontation of the document
during cross-examination does not amount to proof of its
contents, and that the burden to prove the document lies upon the
defendant, which is to be discharged at the stage of his evidence.
2.3 Aggrieved thereby, the defendant-petitioner preferred a writ
petition before this Court bearing number S.B. Civil Writ Petition
No. 1447/2017, which was disposed of vide order dated
16.12.2025, directing that the application filed by the plaintiff-
respondent be restored to its original position and reconsidered
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afresh in light of the provisions of the Act of 1998. It was further
directed that, if upon such reconsideration the trial Court finds the
document to be insufficiently stamped, it shall follow the
procedure prescribed under law for impounding the same.
2.4 However, thereafter, the learned trial Court, vide order dated
19.01.2026, allowed the application and held that the partition
agreement in question, being unregistered, is inadmissible in
evidence. The Court further directed that the document be
impounded and placed in record in “Part D” of the case file.
Notwithstanding the same, the trial Court did not forward the
document to the competent authority, i.e., Collector (Stamps), for
proper recovering the stamp duty in accordance with law.
2.5 Aggrieved by the order dated 19.01.2026, the defendant-
petitioner has preferred the present writ petition.
3. Learned counsel for the petitioners submits that this Court
had issued a specific direction that, in the event the learned trial
Court finds the document to be insufficiently stamped, it shall
follow the procedure prescribed under law for impounding the
same. He further submits that the learned trial Court has failed to
comply with the said direction and has merely ordered that the
document be impounded and kept in record, without adhering to
the statutory procedure.
3.1 Learned counsel for the petitioners contends that such non-
compliance has caused prejudice to the State, as it would be
deprived of the stamp duty and penalty lawfully payable on the
document. Learned counsel emphasizes that, under the provisions
of the Act of 1899, it is incumbent upon every authority, including
a Court, to either levy the requisite stamp duty along with penalty
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on an insufficiently stamped document or to refer the same to the
competent authority for appropriate action.
3.2 Learned counsel for the petitioners, therefore, urges that
despite the clear directions issued by this Court, the learned trial
Court has failed to act in accordance therewith and has passed the
impugned order in disregard of both the statutory mandate and
the binding directions of this Court.
4. Per contra, learned counsel for the respondent supports the
impugned order and submits that where a Court finds a document
to be inadmissible in evidence on account of non-registration, it is
not obligatory for the trial Court to refer the document to the
competent authority for adjudication on the issue of insufficient
stamp duty. It is contended that once the document is held to be
inadmissible for want of registration, no further exercise under the
Act of 1899 is warranted.
5. Heard learned counsel for both the parties and perused the
material available on record.
5.1 Before adverting to the consideration of issues as raised by
the learned counsel for the parties, it is apposite to state that this
Court shall deal in accordance with the scheme of provisions of the
Rajasthan Stamp Act, 1998 which is pari materia to the Indian
Stamps Act, 1899.
6. Pursuant to the order dated 16.12.2025 passed in S.B. Civil
Writ Petition No. 1447/2017, this Court directed that the
application filed by the plaintiff-respondent be restored to its
original position and reconsidered afresh in light of the provisions
of the Act of 1998. It was further directed that, upon such
reconsideration, if the trial Court finds the document to be
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insufficiently stamped, it shall follow the procedure prescribed
under law for impounding the same.
6.1 A perusal of the impugned order dated 19.01.2026 reveals
that the trial Court has recorded a categorical finding that the
document in question is insufficiently stamped. Therefore, there
remains no dispute regarding the insufficiency of stamp duty on
the said document under the applicable provisions of the Act of
1998.
6.2 In this backdrop, the question that arises for consideration
before this Court is whether, upon impounding a document, it is
incumbent upon the Court to transmit the instrument to the
competent authority for determination of the proper stamp duty
and imposition and collection of the requisite penalty. For the sake
of reference, it is apposite to reproduce the relevant sections for
adjudication of the issues involved in the present matter.
Section 37 of the Act of 1998 corresponding to the Section 33 of
the Act of 1899 is reproduced hereinbelow:
“37. Examination and impounding of instruments.- (1)
Every person having by law or consent of parties authority
to receive evidence, and every person incharge of a public
office, except an officer of a police, before whom any
instrument, chargeable, in his opinion, with duty, is
produced or comes in the performance of his functions,
shall, if it appears to him that such instrument is not duly
stamped, impound the same.
(2) For that purpose every such person shall examine every
instrument so chargeable and so produced or coming before
him, in order to ascertain whether it is stamped with a
stamp of the value and description required by the law in
force in the State when such instrument was executed or
first executed:
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[2026:RJ-JP:16890] (6 of 21) [CW-1991/2026]Provided that –
(a) nothing herein contained shall be deemed to require any
Magistrate or Judge of a Criminal Court to examine or
impound, if he does not think fit so to do, any instrument
coming before him in the course of any proceeding other
than a proceeding under Chapter IX or Part D of Chapter X
of the Code of Criminal Procedure, 1973 (Act No. 2 of
1974);
(b) In the case of a Judge of a High Court, the duty of
examining and impounding any instrument under this
section may be delegated to such officer as the Court
appoints in this behalf.
(3) For the purposes of this section in cases of doubt –
(a) The State Government may determine what offices shall
be deemed to be public offices; and
(b) The State Government may determine who shall be
deemed to be persons incharge of public offices.
(4) When a person incharge of a public office, during the
course of inspection or otherwise, detects from an
instrument or copy thereof or when it appears therefrom to
the person referred to in sub-section (1) that the instrument
is not duly stamped, such person shall forthwith make a
reference to the Collector in that matter.
(5) The Collector may, suo-moto or on such reference, call
for the original instrument for ascertaining whether it is duly
stamped and the instrument so produced shall be deemed
to have been produced or come before him in the
performance of his functions and in case the original
instrument is not produced within the period specified by
the Collector, he may require the payment of the proper
duty or the amount required to make up the same together
with the penalty under section 44.”
Section 39 of the Act of 1998 corresponding to the Section 35 of
the Act of 1899 is reproduced hereinbelow:
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[2026:RJ-JP:16890] (7 of 21) [CW-1991/2026]“39. Instruments not duly stamped inadmissible in
evidence, etc. – No instrument chargeable with duty
under this Act shall be admitted in evidence for any
purpose by any person having by law or consent of parties
authority to receive evidence, or shall be acted upon,
registered or authenticated by any such person or by any
public officer, unless such instrument is duly stamped:
Provided that –
(a) any such instrument shall, subject to all just exceptions,
be admitted in evidence on payment of, – (i) the duty with
which the same is chargeable, or in the case of an
instrument insufficiently stamped, of the amount required
to make up such duty, and (ii) a penalty at the rate of two
percent of the amount of the deficient duty per month or
part thereof for the period during which the instrument
remained insufficiently stamped or twenty five percent of
the deficient stamp duty, whichever is higher, but such
penalty shall not exceed to two times of the deficient stamp
duty.
(b) where a contract or agreement of any kind is effected
by correspondence consisting of two or more letters and
any one of the letters bears the proper stamp; the contract
of agreement shall be deemed to be duly stamped.
(c) nothing herein contained shall prevent the admission of
any instrument as evidence in any proceeding in a criminal
court, other than a proceedings under chapter IX or Part D
of Chapter X of the Code of Criminal Procedure, 1973 (Act
No. 2 of 1974).
(d) nothing herein contained shall prevent the admission of
any instrument in any court when such instrument has
been executed by or on behalf of the Government or where
it bears the certificate of the Collector as provided by
section 36 or any other provision of this Act.
(e) nothing herein contained shall prevent the admission of
a copy of any instrument or of an oral account of the
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[2026:RJ-JP:16890] (8 of 21) [CW-1991/2026]portion of the stamp duty and penalty as specified in clause
(a) is paid.
(f) nothing herein contained shall prevent the admission of
any instrument in evidence in any court when stamp duty
on such instrument has already been paid in advance in the
form of a consolidated lump sum.
(g) nothing herein contained shall prevent the admission of
any instrument in any court when such document has been
executed by or on behalf of the Government or where it
bears the Certificate of the Collector as provided by section
36 or any other provision of this Act.”
Section 42 of the Act of 1998 corresponding to the Section 38 of
the Act of 1899 is reproduced hereinbelow:
“42. Instruments impounded how dealt with – (1)
When the person impounding an instrument under
section 37 has by law or consent of parties authority to
receive evidence and admits such instrument in
evidence upon payment of a penalty as provided by
section 39 or of duty as provided by section 41, he shall
sent to the Collector an authenticated copy of such
instrument, together with a certificate in writing, stating
the amount of duty and penalty levied in respect
thereof, and shall sent such amount to the Collector, or
to such person as he may appoint in this behalf.
(2) In every other case, the person so impounding an
instrument shall send it in original to the Collector:
Provided that where the person who produced the
instrument, or any party interested, is prepared to pay
the cost of preparing a copy of the instrument, then:-
(a) an authenticated copy of the instrument shall be got
prepared by the person impounding the instrument;
(b) only the authenticated copy shall be sent to the
Collector;
(c) the Collector shall take action on the authenticated
copy as if it were the instrument in original; and(Uploaded on 01/05/2026 at 12:32:45 PM)
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(d) any certificate to be endorsed with reference to the
instrument by the Collector under clause (a) of sub-
section (1) of section 44 or under sub-section (1) of
section 46 shall be endorsed on the authenticated copy,
ordinarily within 30 days of receipt of the instrument by
the Collector and when that copy is received back by the
person impounding the instrument that person shall
copy the certificate on the original instrument and also
authenticate such copy of the certificate.”
6.3 In this regard, it is pertinent to note that the scheme of the
Act of 1998 contemplates a structured procedure once an
instrument is found to be insufficiently stamped. The act of
impounding is not an end in itself but triggers a statutory process
for proper adjudication of stamp duty and penalty. The rationale
behind requiring transmission to the Collector lies in the fact that
such authority is specifically vested with the jurisdiction and
expertise to determine the correct duty payable and to impose
penalties in accordance with the statutory framework. This
ensures uniformity, prevents arbitrary assessment, and protects
the revenue interests of the State.
6.4 Accordingly, once a document is impounded, the Court is
ordinarily expected to act in consonance with the prescribed
statutory mechanism, which generally includes forwarding the
instrument to the competent authority. This interpretation aligns
with the legislative intent of maintaining procedural consistency
and safeguarding fiscal compliance under the Act of 1998.
6.5 In the case of Seetharama Shetty vs Monappa Shetty; 2024
AIR(SC) 5327, the Hon’ble Apex Court elaborately explained the
manner in which impounded instruments are to be dealt with
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while interpreting the relevant statutory provisions. The relevant
paragraph is reproduced hereinbelow for ready reference:
“17.4. Section 37 of the Act stipulates the procedure on
how the instrument impounded is dealt with. The plain
reading of Section 37(1) of the Act discloses that the
person impounding the instrument under Section 33 of
the Act and after receiving the penalty under Section
34 of the Act or duty under Section 36 of the Act, shall
send to the Deputy Commissioner an authenticated
copy of such instrument together with the amount of
duty and penalty so levied and collected. Section 37(2)
of the Act deals with an instrument not subjected to
the procedure of Sections 34 or 36 of the Act.
According to Section 37(2) of the Act, the instrument is
sent to the Deputy Commissioner for enquiry and
decision at his end. The Deputy Commissioner gets
jurisdiction under Section 39 of the Act and then
decides the duty and also the penalty leviable on the
insufficiently stamped instrument. In this background,
we take note of the principle laid down on the
distinction in the discretion available to Every
Person/Court and the discretionary jurisdiction
conferred on the District Registrar. See, United
Precision Engineers (supra) and Gangappa (supra). The
settled distinction and discretion available under
Sections 34 and 39 of the Act is no more res integra.”
6.6 In the case of Mungi Devi vs. Ramlal, S.B. Civil Writ Petition
No. 25010/2025, decided on 19.01.2026, a Co-ordinate Bench of
this Court at Jodhpur, while placing reliance on the earlier
judgment of the Division Bench of this Court in Sanjeev
Bhardwaj and Ors. vs. Yogeshwar Swaroop Bhatnagar and
Ors.; 2020 (3) RLW 2574 (Raj.), elaborately explained the
manner in which an impounded instrument is to be dealt with.
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The relevant paragraph is reproduced hereinbelow for ready
reference:
15. The reliance placed by the petitioner upon the
judgment passed in the case of Sanjeev Bhardwaj
(supra) is very much relevant, where upon a reference
made by the learned Single Judge, a specific Issue
No.3 was framed and decided by the Hon’ble Division
Bench of this Court. For ready reference, the Issue
No.3 as framed is quoted below:-
“Whether on production of unstamped document,
Court is duty bound to determine the stamp fee
along with penalty, as per Section 35(1) of the
Act or to impound the same under Section 33 of
the Act and send the same to the Collector for
determination of stamp duty and penalty in order
to make the document admissible?”
16. The said issue has been answered by the learned
Division Bench in affirmative. The relevant Para Nos.
30 to 37 reads as under:-
“30. Adverting now to the third question whether
the Court is bound to follow the procedure
provided in Sections 33 and 35 of the Stamp Act,
1899, we shall presently deal with the scheme of
the legislation with reference to provisions of the
Rajasthan Stamp Act, 1998. Section 39 of the
Rajasthan Stamp Act is corresponding to Section
35 of the Indian Stamp Act, 1899, which
mandates that no instrument chargeable with
duty under the Act shall be admitted in evidence
for any purpose by any person having, by law or
consent of parties, authority to receive evidence,
or shall be acted upon, registered or authenticated
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[2026:RJ-JP:16890] (12 of 21) [CW-1991/2026]such instrument is duly stamped. Significantly,
neither Section 37 of the Rajasthan Stamp Act
(Section 33 of the Stamp Act, 1899), nor Section
39 of the Rajasthan Stamp Act (Section 35 of the
Stamp Act, 1899), contain a proviso like Section
49 of the Registration Act enabling the Court to
use an instrument for collateral purpose, which
though is chargeable to stamp duty, but is
unstamped or insufficiently stamped. Language of
both these provisions is peremptory in nature and
mandates that the Court cannot use such
document for any purpose whatsoever.The Stamp
Act casts a duty upon every Court, i.e., a person
having by law authority to receive evidence, to
examine the instrument in order to ascertain
whether it is duly stamped, and if the Court
comes to the conclusion that the instrument is not
duly stamped, it has to mandatorily impound the
same and deal with it as provided under the Act.
The mandatory nature of the Act is evident from
the use of the word “shall” both in Section 37 and
39 of the Rajasthan Stamp Act, which are
analogous to Sections 33 and 35 of the Stamp
Act, 1899.
31. The Supreme Court in Government of A.P. vs.
P. Laxmi Devi (2008) 4 SCC 720 held that it is
incumbent upon the Court to impound the
document unstamped or insufficiently stamped.
Para 16 of the report, which is relevant, is
reproduced hereinunder:
“16. A perusal of the said provision shows
that when a document is produced (or
comes in the performance of his functions)
before a person who is authorized to
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[2026:RJ-JP:16890] (13 of 21) [CW-1991/2026]charge of a public office (except a police
officer), before whom any instrument
chargeable with duty is produced or comes
in the performance of his functions, it is the
duty of such person before whom the said
instrument is produced to impound the
document if it is not duly stamped. The use
of the word ‘shall’ in Section 33(1) shows
that there is no discretion in the authority
mentioned in Section 33(1) to impound a
document or not to do so. In our opinion,
the word ‘shall’ in Section 33(1) does not
mean ‘may’ but means ‘shall’. In other
words, it is mandatory to impound a
document produced before him or which
comes before him in the performance of his
functions. Hence, the view taken by the
High Court that the document can be
returned if the party does not want to get it
stamped is not correct.”
32. Another significant question of law which
arises for consideration is whether on impounding
the instrument, the court should on its own
collect the deficient stamp duty and penalty as
envisaged in Section 39 of the Rajasthan Stamp
Act or after impounding such instrument, send
the same to the Collector for the needful. Clause
(a) of proviso to Section 39 stipulates that the
impounded instrument shall, subject to all just
exceptions, be admitted in evidence on payment
of- (i) the duty with which the same is
chargeable, or in the case of an instrument
insufficiently stamped, of the amount required to
make up such duty and (ii) a penalty at the rate
of two percent of the amount of the deficient duty
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per month or part thereof for the period during
which the instrument remained insufficiently
stamped or twenty five percent of the deficient
stamp duty, whichever is higher, but such penalty
shall not exceed to two times of the deficient
stamp duty. Clause (e) of the proviso to Section
39 further clarifies it by providing that nothing
herein contained shall prevent the admission of a
copy of any instrument or of an oral account of
the contents of any instrument, if the stamp duty
or a deficient portion of the stamp duty and
penalty as specified in clause (a) is paid. In
contrast, Section 37(1) of the Rajasthan Stamp
Act provides that if a document is produced
before a person or a public office having authority
in law to receive evidence, which in his opinion is
chargeable to stamp duty and is not duly
stamped, shall impound the same. Section 37(4)
provides that such person shall forthwith make a
reference in that matter to the Collector. Sub-
section (5) of Section 37 then provides that
Collector may suo-moto or on such reference, call
for the original instrument for ascertaining
whether it is duly stamped and the instrument so
produced shall be deemed to have been produced
or come before him in the performance of his
functions and in case the original instrument is
not produced within the period specified by the
Collector, he may require the payment of the
proper duty or the amount required to make up
the same together with the penalty under section
44. Sub-section (1) of Section 42 of the
Rajasthan Stamp Act provides that when the
person having authority of law or consent of the
parties to receive evidence, impounds an
instrument under Section 37 and admits such
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instrument in evidence upon payment of a
penalty as provided by Section 39 or of duty as
provided by Section 41, shall sent to the Collector
an authenticated copy of such instrument,
together with a certificate in writing, stating the
amount of duty and penalty levied in respect
thereof, and shall sent such amount to the
Collector, or to such person as he appoints in this
behalf. Sub-section (2) of Section 42 further
provides that in every other case, the person so
impounding an instrument shall send it in original
to the Collector.
33. The important aspect which is required to be
considered also at this juncture is whether the
Court impounding the document has any
discretion to charge lesser penalty than what has
been provided for by Section 39 of the Rajasthan
Stamp Act. In this connection, reference may be
made to Section 44 of the Rajasthan Stamp Act,
which provides for power of the Collector to
stamp the impounded instrument. Section 44(1)
(b) provides that when the Collector receives an
instrument sent to him under sub-section (2) of
Section 42, chargeable with a duty under this
Act, he shall, if in his opinion, such instrument is
duly stamped or is not chargeable with duty,
certify so by endorsement on such document or if
he is of opinion that such instrument is
chargeable with duty and is not duly stamped, he
shall require the payment of proper duty or the
amount required to make up the same, together
with a penalty at the rate of two percent of the
amount of the deficient duty per month or part
thereof for the period during which the
instrument remained unstamped or insufficiently
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stamped or twenty five percent of the deficient
stamp duty, whichever is higher, but not
exceeding two times the deficient stamp duty.
Sub-section (2) of Section 44 then provides that
every certificate under clause (a) of sub-section
(1), shall for the purpose of this Act, be
conclusive evidence of matters stated therein.
Sub-section (3) of Section 44 further provides
that where an instrument has been sent to the
Collector under sub-section (2) of Section 42, the
Collector shall, when he has dealt with it as
provided by this section, return it to the
impounding officer. But the Collector under
Section 43 of the Act has been conferred with a
discretion to refund whole of the penalty paid in
respect of an instrument, which has been
impounded and sent to him under sub-section (1)
of Section 42 only because it has been written in
contravention of Section 13 or Section 14. No
such discretion, however, has been conferred on
the Court.
34. The Supreme Court in a recent judgement in
Gangappa & Anr. vs. Fakkirappa-(2019) 3 SCC
788 in the scope of Section 34 of the Karnataka
Stamp Act 1957 (analogous to Section 39 of the
Rajasthan Stamp Act) was considering the
question whether the trial court while admitting
an insufficiently stamp document, could have
exercised its discretion in imposing penalty 2
times of deficient amount of stamp duty or it was
obligatory for the trial court to impose the
penalty at the rate of 10 times. Analysing the
provision of Section 38 of the Karnataka Stamp
Act (which is analogous to Section 43 of the
Rajasthan Stamp Act), the Supreme Court held
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that the Deputy Commissioner under that
provision is empowered to refund any portion of
the penalty in excess of five rupees, which has
been paid in respect of such instrument. Since
sub- section (1) of Section 38 uses the
expression “if he thinks fit”, he also has the
discretion to impose penalty of 10 times in the
facts of the particular case. Affirming the view of
division bench of the Karnataka High Court in
earlier judgement of Digambar warty and Ors.
vs. District Registrar, Bangalore Urban District
and Anr., ILR 2013 KAR 2099 that there is no
discretion vested with the authority impounding
the document in the matter of collecting duty
under Section 33 and 34, the Supreme Court
held that the word “shall” used in those
provisions has rightly been interpreted by the
High Court. Analogous provisions to these
Sections are Section 37 and 39 of the Rajasthan
Stamp Act, which also uses the word “shall”,
leaving no discretion to the Court to impose a
penalty other than the one prescribed
thereunder.
35. It shall be in this connection apposite to refer
to the judgement of Supreme Court in Peteti
Subba Rao vs. Anumala S. Narendra-(2002) 10
SCC 427 wherein it was held that the Court can
admit such instrument only on payment of deficit
stamp duty with 10 times of the penalty
suggested as a way out. It was further held that
when a person is not willing or cannot afford to
pay the same, the only available course open for
the Court to adopt is the one envisaged in
Section 38 of the Stamp Act (analogous to
Section 42 of the Rajasthan Stamp Act). The
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[2026:RJ-JP:16890] (18 of 21) [CW-1991/2026]
following discussion made by the Supreme Court
in para 6 of the report is worth quoting:
“6.xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
xxxxxxxxxxx
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxWe find some force in the said plea. In a
case where the party fails to pay the penalty
suggested by the Court, the document
impounded has to be sent to the Collector
for the purpose of taking further steps in
respect of that document as provided in
Section 40 of the Act. The Collector has the
power to require the person concerned to
pay the proper duty together with a penalty
amount, which the Collector has to fix in
consideration of all aspects involved. The
restriction imposed on the Collector in
imposing the penalty amount is that, under
no circumstances, the penalty amount shall
go beyond ten times the duty or the
deficient portion thereof. That is the farthest
limit, which means only in very extreme
situations the penalty need be imposed up
to that limit. It is unnecessary for us to say
that the Collector is not required by law to
impose the maximum rate of penalty as a
matter of course whenever an impounded
document is sent to him. He has to take into
account various aspects, including the
financial position of the person concerned.”
36. The Supreme in Chila Kuri Gangulappa vs.
Revenue Divisional Officer-(2001) 4 SCC 197
also similarly held that if the appellant agrees to
remit the amount of stamp duty and the penalty,
the Court can proceed with the trial after
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[2026:RJ-JP:16890] (19 of 21) [CW-1991/2026]
admitting the document in evidence. If, however,
he is unwilling to do so, the Court shall forward
original of the document itself to the Collector for
the purpose of adjudicating the question of
deficiency of the stamp duty. The following
observation in para 13 of the report, are worth
quoting:
“13. In the present case, the trial court
should have asked the appellant, if it finds
that the instrument is insufficiently
stamped, as to whether he would remit the
deficient portion of the stamp duty together
with a penalty amounting to ten times the
deficiency. If the appellant agrees to remit
the said amount, the Court has to proceed
with the trial after admitting the document
in evidence. In the meanwhile, the Court
has to forward a copy of the document to
the Collector for the purpose of adjudicating
on the question of deficiency of the stamp
duty, as provided in Section 40(1)(b) of the
Act. Only if the appellant is unwilling to
remit the amount, the Court is to forward
the original of the document itself to the
Collector for the purpose of adjudicating on
the question of deficiency of the stamp
duty. The penalty of ten times indicated
therein is the upper limit, and the Collector
shall take into account all factors concerned
in deciding as to what should be the proper
amount of penalty to be imposed.”
37. In the light of the discussion aforesaid, the third
question whether on production of unstamped
document, the Court is duty bound to determine the
stamp fee along with penalty, as per Section 35(1) of
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[2026:RJ-JP:16890] (20 of 21) [CW-1991/2026]
the Act or to impound the same under Section 33 of
the Act and send the same to the Collector for
determination of stamp duty and penalty in order to
make the document admissible, is answered in the
terms that if any instrument is presented before the
Court, which is not duly stamped or insufficiently
stamped, the Court is duty bound to impound the
same and; (i) if the party who produces such
instrument in evidence is willing to pay the stamp duty
or deficit stamp duty together with amount of penalty,
to determine the same and upon deposit of the
amount, so determined, with the Court, it shall be
open for the Court to admit the instrument in
evidence, or; (ii) in the event, however, the party
which produces such instrument does not agree or is
unable to remit the amount of stamp duty/deficit
stamp duty and the penalty, the Court shall send the
impounded instrument to Collector for determination of
stamp duty and penalty, which shall be, only upon
production/receipt of the certificate/endorsement of
deposit thereof, received in evidence.”
(Emphasis Supplied)
6.8 This Court finds that the above reproduced provisions and
judgments squarely explains the question in consideration to the
facts of the present case. Therefore, this Court opinions that
learned trial Court has committed a gross illegality in passing the
impugned order. This Court also finds that the learned District and
Sessions Judge, Jhalawar has not followed the judgment passed
by this Court on 16.12.2025, resulting in filing of the present writ
petition. It is a settled principle of law that whenever an
insufficiently stamped document comes before any authority,
including a Court, it is incumbent upon such authority either to
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[2026:RJ-JP:16890] (21 of 21) [CW-1991/2026]
impose the requisite stamp duty along with a penalty if party
agrees or to refer the document to the competent authority, if the
party do not agree. Merely stating that the document is
impounded and to be kept in record does not satisfy the
requirements of the Act of 1998.
6.9 Therefore, this Court finds that the impugned order is liable to
be quashed and set aside. Accordingly, the present writ petition is
hereby allowed and the impugned order dated 19.01.2026 stands
quashed and set aside.
6.10 Furthermore, the learned District Judge is directed to follow
the procedure prescribed under the Act of 1998 after impounding
an insufficiently stamped document.
6.11 As regards the issue of inadmissibility of the document on
the ground of non-registration, the same is left open to be
considered and decided by the learned Trial Court at the stage of
final judgment. It is, however, clarified that the learned Trial Court
shall consider the document in accordance with the settled legal
position governing, if the document is sought for collateral
purposes then it shall be read in evidence but if the substantive
claim has been made on the basis of the document, the same
shall be ignored.
6.12 Pending application(s), if any, stands disposed of.
(BIPIN GUPTA),J
Sudha/68
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