The Delhi High Court has granted permission through a writ petition, allowing the petitioner to approach the Chief Controlling Revenue Authority for the determination of the payable amount on the instrument. This comes despite the arbitration reference under Section 8 of the Arbitration & Conciliation Act related to the dispute arising from the instrument. Justice Subramonium Prasad, presiding over the case, emphasized that the arbitral tribunal’s authority to conduct a similar assessment does not preclude the High Court from entertaining a writ petition to ascertain whether the state has been deprived of revenue.
Background:
The involved parties had entered into a Memorandum of Understanding (MoU) on 12.11.2014, which included an arbitration clause for dispute resolution. A dispute ensued, leading to the petitioner filing a lawsuit. The respondents then invoked Section 8 of the Arbitration & Conciliation Act, seeking arbitration due to the arbitration clause in the MoU. The Court granted the petition, referring the dispute to arbitration. Dissatisfied, the petitioner filed an LPA, currently pending before the High Court. Subsequently, the petitioner filed a writ petition seeking specific directions, including declaring the agreement null and void.
Petitioner’s Contentions
1. Allegations of inadequate stamping on the MoU, prompting authorities to review for proper stamping. The petition sought a declaration that the MoU, involving property rights, qualifies as a conveyance under the Indian Stamp Act, necessitating ad valorem stamping.
2. Reference to Section 33(2), indicating that a High Court Judge’s duty for examining and impounding an instrument may be delegated to an appointed officer.
Respondent’s Contentions
1. The Respondents claimed that the Court had previously settled the matter in the Section 8 application, stating that the MoU is admissible in evidence. The current petition attempts to bypass that ruling.
2. Invoked Section 16(1)(a) of the Arbitration & Conciliation Act, asserting the arbitral tribunal’s competence to address the petitioner’s objection. Section 16 empowers the tribunal to impound non-stamped or insufficiently stamped instruments.
Court’s Analysis:
The Court, citing Sections 31, 33, and 56 of the Indian Stamp Act, emphasized the provisions’ purpose to safeguard the state’s revenue. It clarified that any court direction on determining stamp duty would not negate the prior Section 8 application’s findings. The Court in that case concluded that stamping was irrelevant for arbitration reference, and thus, the stamp duty amount was not addressed. The Court maintained that the arbitral tribunal’s capability to perform a similar assessment does not diminish the High Court’s jurisdiction. The focus remains on whether the state has been deprived of the stamp duty revenue.
The Court explicitly refrained from commenting on the case’s merits and directed the petitioner to approach the Chief Controlling Revenue Authority for a decision on the sufficiency of stamp duty paid on the instrument.
