1932 (1) TMI 21

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....the company" of the other part. The vendors agreed to sell all their business undertakings and assets as from the 1st of January, 1920, including goodwill, free-hold hereditaments, plants, machinery, etc., contracts, outstanding debts and other goods, with the exception of profits for a short period which had to be assessed on a certain basis and some furniture. The nominal capital of the company was Rs. 30,00.000, which was divided into 15,000 preference shares and 15,000 ordinary shares of Rs. 100 each. Part of the consideration consisted of the allotment of all the shares with the exception of 33 ordinary shares, the consideration for the costs of stores, etc., was to be their market value, and as for the residue of the consideration, th....

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.... moveable properties. It however appears that this very agreement was filed with the Registrar of Joint Stock Companies under section 104 of the Indian Companies Act (VII of 1913) after the allotment of shares had been made subsequent to the agreement. The learned Government Advocate on behalf of the Board of Revenue contends that the agreement was in substance a deed of conveyance of moveable properties as defined in section 2 (10) of the Stamp Act and a contract of sale in respect of the shares within the meaning of section 104 of the Companies Act, and should therefore, have been stamped as a deed of transfer. The instrument was stamped as a mere agreement and bore a stamp of eight annas only. The language of the instrument as quot....

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....agreement of which specific performance would be decreed and will not go on to execute a conveyance, and so the Crown will lose the stamp duty, and it is rather suggested that this would be cheating the Crown and committing a fraud. The Crown, however, must make out its right to the duty, and if there be a means of evading the stamp duty so much the better for those who can evade it. It is no fraud upon the Grown, it is a thing which they are perfectly entitled to do. The Crown cannot have the stamp duty unless the parties to the sale chose to effectuate the transaction by an instrument which of itself conveys the property, and, if they chose to be satisfied with something less, the matter is not brought within section 70 of the Stamp Act o....