TaxTMI 
TaxTMI 
1934 (3) TMI 24
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....Sahib Bhola Ram and Sons, Ltd., was formed, one of the objects of which according to clause 3(a) of the memorandum of association, was to take over the running business of the firm Messrs. Rai Sahib Bhola Ram & Sons with its goodwill and all property, assets and liabilities as on 31st March, 1931 in con sideration of the allotment of fully paid up shares in the capital of the new company as follows:- Rai Sahib Bhola Ram 32 shares. Mr. Sardari Lal and Mr. Jaswant 32 shares each. Rai (sons of Rai Sahib Bhola Ram) It is alleged that the shares were allotted as above in con sideration of an oral agreement on behalf of Messrs. Bhola Ram and Sons to transfer their assets, liabilities and goodwill to the compa....
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....ticulars were chargeable with duty as a 'conveyance' under article 23, Schedule I, of the Indian Stamp Act. The company claimed that the particulars were chargeable as an 'agreement' only with a one rupee stamp. The Registrar, who is also the Collector for the Delhi Province, decided that the objection was valid and ordered the company to pay a stamp duty of Rs. 2,150 together with a penalty of an equal amount. The company appealed to the Chief Commissioner, who is the Chief Controlling Revenue Authority for the Delhi Province, under section 56 of the Indian Stamp Act, for the setting aside of the Collector's order and he has made the present reference under section 57 of that Act as he was of opinion that the question of law involved was n....
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....ned is not reduced to writing, the company shall, within one month after the allotment, file with the Registrar the prescribed particulars of the contract stamped with the same stamp-duty as would have been payable if the contract had been reduced to writing and these particulars shall be deemed to be an instrument within the meaning of the Indian Stamp Act, 1899, and the Registrar may as a condition of filing the particulars, require that the duty payable thereon be adjudicated under Section 31 of the Act. It would appear from the above that clause (b) of sub-Section (1) requires that in the case of shares allotted as fully or partly paid up 'otherwise than in cash', the 'contract in writing constituting the title of the allottee to the....
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....ticulars would be the same as that on the oral agreement referred to above, if it had been reduced to writing. It was contended on behalf of the company that the agreement being to transfer the assets etc. in the future it could not be treated as a 'conveyance', and as an agreement it was liable only to a duty of one rupee in this province. The company had actually paid a stamp duty of Rs. 10 which was in excess of the duty legally payable. In reply to the above contentions of the learned counsel for the company, the learned Government Advocate advanced a two fold argument. He urged firstly that the agreement was in reality to transfer the assets etc., at once and not in the future and secondly, that the particulars supplied under sub-Se....
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....this contract consisted merely of an agreement to transfer properties in the future, it is difficult to see how the particulars thereof could be treated as a transfer of the property in presenti. Sub-Section (2) of Section 104 clearly lays down that the particulars would be liable to the same stamp duty as would have been payable if the contract of which the particulars are supplied had been reduced to writing. Further, column 3 of Form VII prescribed under the Act itself recognises a distinction between sales of property and agreements to sell property which might form the consideration for the allotment. It seems therefore clear that in the circumstances of this case the particulars cannot be treated as a 'conveyance' as the contract of w....
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....ly distinguishable as there was a deed conveying the property in that case. All that was held therein was that the mere fact that the transferors and the transferees were practically identical did not make any difference for the purposes of stamp duty. It was urged by the learned Government Advocate that the firm Bhola Ram and Sons and the new company were practically identical and the alleged oral agreement was merely a device adopted with a view to evade stamp duty. That may be so; but as pointed out in the rulings referred to above we are not concerned with that aspect of the question. It is a well-established principle that fiscal enactments must be construed strictly. We have to interpret the law as it stands and to see whether in view....