Unstamped family arrangement treated as title deed cannot be used even for collateral purposes under stamp law.

A writing described as a family arrangement was treated as the operative instrument of title, not a mere memorandum of an earlier oral settlement, because its recitals showed it was intended to declare and create rights in immovable property. It therefore required proper stamping and registration. An unstamped instrument could not be admitted in evidence for any purpose, and the statutory bar under the Stamp Act extended to collateral use as well. As the document was both unstamped and unregistered, neither its terms nor its contents could be relied on, and oral evidence could not be used to bypass that prohibition.

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Issues: (i) whether the impugned document was a family arrangement or a partition deed requiring stamping and registration; (ii) whether an unstamped and unregistered document of this nature could be admitted in evidence or looked into for any purpose, including collateral purposes.

Issue (i): whether the impugned document was a family arrangement or a partition deed requiring stamping and registration.

Analysis: A family arrangement may be oral, and if reduced to writing only as a record of an already completed arrangement, registration is not required. But where the writing itself is intended to be the sole repository of the arrangement and to declare or create rights in immovable property, it falls within the mischief of compulsory registration and must also bear proper stamp duty. The character of the document has to be decided from its recitals, the surrounding circumstances, and whether it was executed as a mere memorandum or as the operative instrument itself. On the recitals, the document here was treated as the operative instrument, not a mere record.

Conclusion: The document was held to be a family arrangement brought into existence as the instrument of title itself, and therefore required stamping and registration.

Issue (ii): whether an unstamped and unregistered document of this nature could be admitted in evidence or looked into for any purpose, including collateral purposes.

Analysis: An unregistered document, if otherwise duly stamped, may be relied upon for a collateral purpose, such as proving severance in status or the factum of arrangement, but not for proving the terms of the transfer itself. By contrast, Section 35 of the Indian Stamp Act imposes an absolute bar on an unstamped instrument being admitted in evidence for any purpose, and that bar extends to collateral use as well. Oral evidence cannot be allowed to circumvent that statutory prohibition. Since the document was found to be both unstamped and unregistered, neither its terms nor its contents could be acted upon.

Conclusion: The document could not be looked into for any purpose, including collateral purposes, and oral evidence relating to its contents was also inadmissible.

Final Conclusion: The appeal challenging admissibility succeeded, while the connected appeal supporting the document as admissible failed, resulting in a mixed disposal of the common judgment.

Ratio Decidendi: A family arrangement reduced into writing as the operative instrument of title, if unstamped and unregistered, is inadmissible for all purposes, and the statutory bar under the stamp law prevails over any claimed collateral use.

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