1958 (3) TMI 95

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....ndian Companies Act, 1956, particulars of the contract in the prescribed form. That form was signed by Sri Raj Sachdeva as a Director of the Company and bore a stamp of Rs. 2/-, as an agreement under Article 5(c) of Schedule I-B to the Indian Stamp Act, as in force in this State. 3. The question referred to this Court is "Whether the document dated January 11, 1956, executed by Sri Raj Sachdeva is a mere agreement chargeable with a duty of Rs. 2/- under Article 5(c) of the Stamp Act as amended in its application to Uttar Pradesh, or it is in the nature of a conveyance within the meaning of Section 2(10) of the Act, chargeable under Article 23 Schedule I-B of the Act with a duty of Rs. 15,912/-." 4. The question is not very accurately framed for the question is not whether the document of 11-1-1956, is an agreement but whether the prior oral contract the particulars of which are specified in that document would have been chargeable with duty as an agreement or as a conveyance had it been reduced to writing. The Board of Revenue, which is the Chief Controlling Revenue Authority, was inclined to the view that the document was duly stamped, but as it entertained some doubt with r....

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....on is whether such delivery was given in pursuance of the oral contract tor sale or was part and parcel of some subsequent oral contract of sale. There is however no suggestion in the order of reference that there had been in fact any such contract of sale. The vendor did not own any immovable property and the law does not require that a transfer of moveable property should be made by an instrument in writing. If the parties choose to transfer such property by delivery pursuant to a contract for sale they are free to do so. In the present case no deed of conveyance was executed, and the particulars furnished were in my opinion the particulars of the agreement for sale which preceded the completion or the purchaser's title by delivery. Had that agreement been reduced to writing it would have been chargeable with duty under Article 5{c) of Schedule I-B to the Stamp Act and I am therefore of opinion that the particulars filed by the Company tinder Section 104 (2) of the Companies Act were duly stamped. I would therefore, answer the reference accordingly. Dayal, J. 7. I have read the opinion expressed by my Lord the Chief Justice on the question referred for decision and agre....

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....t was treated as an agreement under Article 5(c) of Schedule I-B to the Indian Stamp Act, as applicable to the Uttar Pradesh. A question arose whether the document had been correctly stamped or whether it was liable to be stamped as a conveyance (as defined in Section 2(10) of the Stamp Act) with duty payable under Article 23 of the Schedule. The Board was inclined to the view that the document had been correctly stamped but in view of the conflicting arguments advanced before it, it has referred the question to this Court. 11. The relevant portion of Section 104 of the Companies Act of 1913 reads as follows: "104(1) Whenever a company .....makes any allotment of shares, the company shall within one month thereafter, file (a) ..... (b) in the case of shares allotted as fully or partly paid up otherwise than in cash produce for the inspection and examination of the Registrar a contract in writing constituting the title of the allottee to the allotment together with any contract of sale ..... such contract being duly stamped..... (2) Where such a contract as above mentioned is not reduced to writing the Company shall within one month of the allo....

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....itle to the allotment is constituted and duty has to be paid on that form as if it was a contract made in writing. 15. The contention urged on behalf of Sri Raj Sachdeva in the present case is that in his case the entire transaction consisted of only one contract and that way oral. That was the contract by which he agreed as proprietor of the private firm Messrs. Globe Travels to transfer his concern with all its assets and liabilities to the company and the company in return agreed to pay him Rs. 27,000/-cash and to allot 720/- fully paid shares to him. That according to the learned counsel was not a contract by which either party was making any transfer in praesenti. It was only an agreement to transfer in future. Subsequently in pursuance of it Sri Raj Sachdeva transferred to the company the assets and liabilities of his firm by delivery. As no immovable property was involved the transfer could be made by delivery alone without any contract oral or written. The company had also in pursuance or the same agreement allotted 720 fully paid shares to Sri Raj Sachdeva without there being any oral or written contract for that purpose. He has urged that the only contract entered into....