Impounding a document

Impounding a document

Certain documents are compulsorily registerable under the Indian Registration Act 1908, which are classified under Section 17 (1);

They are, the instruments of gift, sale, all non-testamentary documents which operate to create, assign or limit any right, title or interest in immovable property.

Certain other documents which are not compulsorily registerable, though its registration is optional, which are classified under Section 17(2) of Registration Act 1908;

They are,

(i)                  Shares in a Joint Stock Company, any debenture issued by such company;

(ii)                Any transfer of immovable property of the value below Rs.100/-

(iii)               Any Grant of immovable property by the Govt.

(iv)              Any order granting loan under the Land Improvement Act 1871 or the Agriculturists Loan Act 1884;

(v)                Any order made under the Charitable Endowments Act 1890, vesting any property in a Treasurer of Charitable Endowments.

(vi)              Any endorsement on a mortgage deed acknowledging the payment of the mortgage money;

(vii)             Any ‘Certificate of Sale’ granted to the purchaser of any property sold by public auction by a Civil Officer or Revenue Officer.

The Consequences of non-registration of documents which are compulsorily registerable:

Section 49 of the Registration Act deals with ‘effect of non-registration.’

Sec.49: “No document required by section 17 (or any provision of the Transfer of Property Act 1882) to be registered shall –

(a)    affect any immovable property comprised therein; or

(b)   confer any power to adopt, or

(c)    be received as evidence of any transaction affecting such property or conferring such power,

unless it has been registered.

Provided that an unregistered document affecting immovable property to be registered may be received as evidence of any ‘collateral transaction’ not required to be affected by registered instrument.

(Collateral transaction: An unregistered sale deed cannot be received as evidence in a Court of law to prove the factum of sale, but it can be accepted (for collateral purpose) to prove the factum of possession of the purchaser in the immovable property purchased by him.)

Unregistered documents of the category of Section 17(1), (which are compulsorily registerable) will be inoperative so far as the immovable property in it is concerned.

Collateral means something other than main transaction; and it is always independent to the main transaction.

Impounding an instrument which is not duly stamped:

Section 33 of the Indian Stamp Act 1899 deals with impounding of an instrument.

Sec.33 “Every person having authority to receive evidence, before whom any instrument, chargeable, in his opinion, with duty, is produced or comes in the performance of his function, shall if it appears to him that such instrument is not duly stamped, impound the same.”

Provided such instrument which is not duly stamped may be produced before any Magistrate, Judge of a Criminal Court to examine. (i.e. in criminal proceedings such instruments shall not be impounded.)

Section 35 deals with the inadmissibility of the instrument not duly stamped;

Sec.35: “No instrument chargeable with duty shall be admitted in evidence for any purpose by any person having authority to receive evidence, unless such instrument is duly stamped.

Provided it may be admitted in evidence on payment of the duty with which the same is chargeable together with a penalty of ‘ten times’ the amount of the proper duty or deficient portion  thereof.