Affidavit form controls stamp duty classification, and completed assessments bar later recovery of deficit duty

A document styled and sworn as an affidavit is treated as an affidavit for stamp purposes based on its form and contents, not on the purpose for which it was required; accordingly, patti documents executed in affidavit form were chargeable to stamp duty under Article 4 of Schedule I-A of the Indian Stamp Act. Where a tax officer has already admitted such documents, completed assessments, and acted on them without impounding them at that stage, the officer becomes functus officio and cannot later reopen the matter to recover deficit stamp duty or penalty outside the statutory procedure. The text therefore treats late recovery action as unauthorized once the assessment process is complete.

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Issues: (i) whether the 'pattis' executed in affidavit form were affidavits chargeable to stamp duty under Article 4 of Schedule I-A of the Indian Stamp Act; (ii) whether, after the Commercial Tax Officer had completed the assessments and acted upon the documents, he could thereafter reopen the matter and recover stamp duty and penalty under the Indian Stamp Act.

Issue (i): whether the 'pattis' executed in affidavit form were affidavits chargeable to stamp duty under Article 4 of Schedule I-A of the Indian Stamp Act.

Analysis: The nature of a document for stamp purposes depends on its contents and form, not on the purpose for which it was required or whether the law compelled that form. Although the sales tax rules required only a certificate from the agent, the documents were in fact drawn up and sworn in affidavit form and were duly attested as affidavits. A document which is in the form of an affidavit remains an affidavit for the Stamp Act.

Conclusion: The documents were affidavits and were chargeable to stamp duty under Article 4 of Schedule I-A of the Indian Stamp Act.

Issue (ii): whether, after the Commercial Tax Officer had completed the assessments and acted upon the documents, he could thereafter reopen the matter and recover stamp duty and penalty under the Indian Stamp Act.

Analysis: Under the Stamp Act, an insufficiently stamped instrument must be dealt with when it is first presented: it may be admitted in evidence on payment of proper duty and penalty, or it must be impounded and sent to the Collector. Once the officer has admitted the document in evidence and acted upon it without following that procedure, the matter is concluded so far as that officer is concerned. The power to question sufficiency of stamp and take consequential action then lies only within the statutory appellate or revisional framework. After completion of the assessments, the Commercial Tax Officer became functus officio and had no jurisdiction to initiate recovery proceedings for stamp duty and penalty.

Conclusion: The Commercial Tax Officer had no authority to recover the deficit stamp duty and penalty after completing the assessments and acting upon the documents.

Final Conclusion: The writ petition succeeded and prohibition was issued against recovery of stamp duty and penalty on the documents in question, with costs to the petitioners.

Ratio Decidendi: For stamp purposes, the character of a document is determined by its actual form and contents; once an officer admits an insufficiently stamped instrument in evidence and acts upon it without impounding it or recovering duty at that stage, he becomes functus officio and cannot later reopen the matter to collect stamp duty and penalty.

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