This article is written by Beejal Ahuja. In this article, the author explains the concept of reference and revision under the Indian Stamp Act, 1899.

Introduction

Indian Stamp Act was made with the purpose of generating revenue for the government. It makes an obligation on the people to pay stamp duty on certain documents in order to make it legally valid and admissible in the court of law. So, for making any evidence admissible in court it has to be duly stamped. According to Section 2(11) duly stamped means that document or instrument has adhesive or impressed stamp, not less than the amount required by law and without any violations. In case the stamp duty is not paid or deficiently paid then the person has to bear the penalty and pay that also.

There is always a higher authority which exercises control over a lower authority. When a lower authority has any doubt or confusion then it goes to a higher authority that is called reference. And when the higher authority feels that lower authority has given a judgment which is not correct or taken a decision over a case which does not come under its jurisdiction, then higher authority will look into that matter and this is called revision. Suppose, if any tribunal entertains a case and passed a judgment over which it had no jurisdiction and its ultra vires and the higher authority will step in to quash the judgment. This is called revision. So, here is a two-way control mechanism between two authorities.

Reference and Revision under Indian Stamp Act

Reference and Revision under Indian Stamp Act have been mentioned in Chapter VI, from Section 56-Section 61. Authorities under the Indian Stamp Act which are involved in reference and revision are Collector, Chief Controlling Revenue Authority and High Court. Firstly, anything related to the stamp duty paid or not paid goes to the Collector, when he feels a doubt regarding the same then he refers it to Chief Controlling Revenue Authority (CCRA). Then if the CCRA also feels a doubt regarding a case then it refers the case to the high court of respective states. And Section 57 states the control of the High court over CCRA.

Section 56 states about the control of CCRA over Collector. Collector is the main authority under Indian Stamp Act. His powers are subject to control of CCRA. And if the collector feels any doubt regarding the amount of duty chargeable on any instrument, he may refer it to CCRA for decision. The CCRA will consider the case and after taking a decision shall send a copy to the Collector who will then proceed to assess and charge the stamp duty in conformity with the decision given by CCRA.

Section 57 states the control of the High court over the Chief Controlling Revenue Authority. If CCRA cannot decide a case referred to, then it may refer such a case to the high court of respective states. And if any other feels any doubt or have any opinion regarding the same case, it may make a reference to the high court.

When a case comes to the Collector and he has given a decision on the case regarding the stamp duty to be paid more or penalty to be charged is declared. Then Chief Controlling Revenue Authority and high court don’t have the authority to review or change the decision. Reference could only be made if the decision is pending before the collector and he has performed the duty of referring the case to a higher authority.

In Nanak Chand Mehrotra v. Board of Revenue, it was stated that Section 57 makes it clear that the Chief Controlling Revenue Authority can make reference to the high court only when there is a case pending before them in which there is a doubt regarding the amount of the stamp duty and it is yet to be decided. Also, in Board of Revenue v. Lakshmipat Singhania, it was held by a special bench comprising of J. Mootham, J Raghubar Dayal and J. Srivastava, that Section 57(1) will not be applied until and unless there is a case pending before the Revenue Authority, even if the case was referred to it under Section 56(2) or the authority may just give effect when coming to notice to the advisory opinion of the respective High Court as mentioned under Section 59(2).

But if the case is not yet decided then it’s the duty of the Revenue Authority to refer the case to the respective high court. This was held in Chief Controlling Revenue Authority v. Maharashtra Sugar Mills Ltd, that though the power to make the reference under Section 57 is with the Revenue Authority but it was not for its benefit alone. It was casting a duty on the Revenue Authority to make the reference and to do the correct thing when there arises an important question of law with regard to the document. If the Authority failed to perform the duty then the power was with the High Court to order the Authority to discharge its duty and make the reference to the court, though there was an issue rose by the respondents that there was no reference to be made under Section 57 as the case was not pending before the Chief Controlling Revenue Authority because the certificates were already issued by the Collector under Section 42 and the documents were also registered so the matter was not pending anymore. 

In Caltex (India) Ltd. v. The Union of India and Ors. The Sub-Registrar impounded two documents and sent them to the Deputy Collector, who said that those documents were exempted from stamp duty. But the Inspector-General felt that the opinion of the Deputy Collector was wrong and he reported the matter to the Board of Revenue for decision. The Board of Revenue referred the question of stamp duty to the High Court under Section 57 where it was heard by a bench consisting of Sir Arnold White C.J, J. Bhashyam Ayyangar and J. Moore. It was stated by J. Bhashyam Ayyangar under Section 56, Board of Revenue did not have the power to revise the certificate issued by Collector under Section 40 or Section 42. He said that the Board could only control the power of the Collector when he has not executed it but after its exercise it cannot be undone.

The main issue raised in Caltex’s case was that even after the reference the High Court had any jurisdiction over the matter when the Collector had already issued the certificate that the documents were exempt from the stamp duty. It was stated by J. Moore, the third learned judge that the Revenue Authority could look upon or interfere with the decision of the Collector but cannot change or alter it once a certificate has been issued.

It was held that after the collector had issued the certificate and the amount and penalty had been paid by petitioner under Section 42, although the writ petitions were pending, and also there was no case pending before the Revenue Authority even though it was directed to refer the case to court but Court will not express any opinion. And the prayer made by the petitioner for mandamus was not granted, in the view of above-mentioned reasons. Consequently, both the petitions were dismissed.

The above case was that the Inspector– General of registration felt that the opinion of the collector was not correct and even the Revenue Authority thought there was some intricate question of law but no one could do anything. Now, this where the party had to suffer because even the court was not able to interfere as it had no jurisdiction only if the case was pending before the collector something would have happened. But the collector had already issued the certificate even if it was wrong somewhere no one could alter it.

In another case of Kisanlal Kotari v. State of Orissa, the Collector called the plaintiff to pay the proper stamp duty and penalty for the document of dissolution of partnership. The learned court, in this case, said that the document was really a dissolution of partnership one but cannot do anything in this case and dismissed the suit stating that it had no jurisdiction to change or alter the order of Collector. The lower appellate court also confirmed the same that the Civil Court has no jurisdiction. It further stated that if the Collector has decided that the instrument is not duly stamped and requires penalty then the plaintiff has to pay the proper stamp duty chargeable together with penalty.

It is provided under the sub-section (2) that a certificate under Clause (a) of sub-section (1), of Indian Stamp Act, shall be the conclusive proof of the matter or case. But Section 45 of Indian Stamp Act has the provisions that Chief Controlling Revenue Authority can receive an application in writing within one year of paying the stamp duty or penalty with the subject of reconsidering the matter and this section gives power to the authority to order the whole or a partial refund of the penalty. Sub-section (2) of Section 45 also states that if Chief Controlling Revenue Authority is of the view that the stamp- duty charged or penalty charged is in excess of what actually is required legally and has been paid under Section 35 or Section 40, then the Revenue Authority may within the three months of the refund application made, order the refund of excess.

In the above case, the penalty and stamp duty charged was more than what legally is chargeable. And here also no one could interfere but the order for refund of the excess duty or penalty could be made through an application but that too within one year of the penalty paid. After one year the plaintiff has to bear the charges and neither the Chief Controlling Revenue Authority nor the high court could have jurisdiction over the case, consequently the order or decision of the collector would be the final one. 

Article 58 of Indian Stamp Act, empowers the High Court to send back the case to the Chief Controlling Revenue Authority to make some alterations or changes if it is not able to understand the case and the questions raised through the statements already mentioned in case. So, the alterations are to be made in order to make it easy for the court to understand what intricate question of law is raised.

Article 59 of the act mentions about the procedure of disposing of the case, the High Court, after hearing the case and looking upon the questions raised, shall give the decision and also states the grounds on which the decision is given. The copy of the decision would be sent to the Revenue Authority and then it may act in accordance with the decision and then can dispose off the case.

Article 60 of the act deals with the statement of the case by other courts, so if any other court other than the one mentioned in Section 57, has some opinions regarding the stamp duty involved in the case, then the judge in the case may present it up as his own statement and shall also consider it as a case referred under Section 57 and then shall send the decision to the Revenue Authority. 

Article 61 of the act talks about the revision of certain decisions of Courts regarding the sufficiency of stamps, when there is any instrument as evidence is produced before any court other than the one mentioned in Section 57 and it is of the opinion that it is not duly stamped then it may impound it when produced. The court will then send the statement and the instrument to the Collector for consideration.

Conclusion

It can be clearly seen that through this process of reference and revision, person gets an opportunity to avoid all the errors be it a factual one or a legal one. Though the right to reference and revision can only be exercised as per the provisions under the Indian Stamp Act. It reduces the burden of cases over the courts somehow as many of the cases are dealt and decided by the Collector. Even if not by the collector there is another authority before it goes to the high court that is Chief Controlling Revenue Authority. This concept of revision and reference can be seen in CPC, CrPC also. There could be some amendments made regarding the final decision in cases where the decision of the Collector or Chief Controlling Revenue Authority is in doubt.