Conveyance classification on partnership dissolution deed prevails where undivided interest is transferred for consideration and higher stamp duty applies.

An instrument executed on dissolution of a partnership, by which one partner relinquished his undivided interest in the assets for money and the other partner took over the business assets and liabilities, was treated in substance as a conveyance rather than a mere release. The use of the word "release" did not control classification where the operative effect was transfer of an interest in common property for consideration. Where the instrument answered both the release and conveyance descriptions in the Schedule, Section 6 required the higher stamp duty to be paid, so the deed was chargeable as a conveyance under Article 19.

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Issues: Whether the instrument executed on dissolution of the partnership was chargeable as a release under Article 44 of the Schedule to the Mysore Stamp Act, 1957, or as a conveyance under Article 19 of that Schedule, and whether Section 6 required the instrument to bear the higher stamp duty if it answered both descriptions.

Analysis: The operative effect of the deed was that one partner relinquished his share and interest in the partnership assets in consideration of money, while the other partner obtained the business assets and liabilities. After dissolution of a firm, the partners held the assets as co-owners with undivided interests, and a transfer of such undivided interest for cash could amount in substance to a sale and therefore a conveyance. The mere use of the expression release did not control the legal character of the document. Where an instrument fell within two descriptions in the Schedule and the duties differed, Section 6 made it chargeable only with the higher duty. On that footing, the document was properly assessable as a conveyance, notwithstanding that some elements of release were also present.

Conclusion: The deed was held to be chargeable as a conveyance under Article 19 of the Schedule to the Mysore Stamp Act, 1957, and not merely as a release under Article 44; the higher ad valorem duty was payable.

Final Conclusion: The reference was answered against the petitioner and in favour of the revenue on the stamp-duty classification of the instrument.

Ratio Decidendi: An instrument by which a co-owner or partner transfers an undivided interest in common or partnership property for monetary consideration is, in substance, a conveyance; if it also falls within a release entry, the instrument bears the higher duty under the statute.

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