Chapter IV INSTRUMENTS NOT DULY STAMPED

(1) Every person having by law or consent of parties authority to receive evidence, and every person in charge of a public office, except an officer of police, before whom any instrument, chargeable in his opinion, with duty, is produced or comes in the performance of his functions, shall, if it appears to him that such instrument is not duly stamped, impound the same.

1. (2) For that purpose every such person shall examine every instrument so chargeable and so produced or coming before him, in order to ascertain whether it is stamped with a stamp of the value and description required by the law in force in the 1[State of Karnataka]1 when such instrument was executed or first executed: 1. Adapted by the Karnataka Adaptations of Laws Order, 1973 w.e.f. 1.11.1973. Provided that,—
   • (a) nothing herein contained shall be deemed to require any Magistrate or Judge of a Criminal Court to examine or impound, if he does not think fit so to do, any instrument coming before him in the course of any proceeding other than a proceeding under Chapter XII or Chapter XXXVI of the Code of Criminal Procedure, 1898;
   • (b) in the case of a Judge of the High Court, the duty of examining and impounding any instrument under this section may be delegated to such officer as the Court appoints in this behalf.
2. (3) For the purposes of this section, in cases of doubt, the Government may determine,—
   • (a) what offices shall be deemed to be public offices; and
   • (b) who shall be deemed to be persons in charge of public offices.

No instrument chargeable with duty shall be admitted in evidence for any purpose by any person having by law or consent of parties authority to receive evidence, or shall be acted upon, registered or authenticated by any such person or by any public officer, unless such instrument is duly stamped: Provided that,—

1. (a) any such instrument not being an instrument chargeable 1[with a duty not exceeding fifteen naye paise]1 only, or a mortgage of crop [Article 1[35]1 (a) of the Schedule] chargeable under clauses (a) and (b) of section 3 with a duty of twenty-five naye paise shall, subject to all just exceptions, be admitted in evidence on payment of the duty with which the same is chargeable, or, in the case of an instrument insufficiently stamped, or the amount required to make up such duty, together with a penalty of five rupees, or, when ten times the amount of the proper duty or deficient portion thereof exceeds five rupees, of a sum equal to ten times such duty or portion;
2. (b) where a contract or agreement of any kind is effected by correspondence consisting of two or more letters and any one of the letters bears the proper stamp, the contract or agreement shall be deemed to be duly stamped;
3. (c) nothing herein contained shall prevent the admission of any instrument in evidence in any proceeding in a Criminal Court, other than a proceeding under Chapter XII or Chapter XXXVI of the Code of Criminal Procedure, 1898;
4. (d) nothing herein contained shall prevent the admission of any instrument in any Court when such instrument has been executed by or on behalf of the Government, or where it bears the certificate of the 1[Deputy Commissioner]1 as provided by section 32 or any other provision of this Act 2[and such certificate has not been revised in exercise of the powers conferred by the provisions of Chapter VI]2.

¹ Substituted by Act 29 of 1962 w.e.f. 1.10.1962.

¹ Substituted by Act 29 of 1962 w.e.f. 1.10.1962.

² Inserted by Act 29 of 1962 w.e.f. 1.10.1962.

Where an instrument has been admitted in evidence such admission shall not, except as provided in section 58, be called in question at any stage of the same suit or proceeding on the ground that the instrument has not been duly stamped.

The State Government may make rules providing that, where an instrument bears a stamp of sufficient amount but of improper description, it may, on payment of the duty with which the same is chargeable, be certified to be duly stamped, and any instrument so certified shall then be deemed to have been duly stamped as from the date of its execution.

(1) When the person impounding an instrument under section 33 has by law or consent of parties authority to receive evidence and admits such instrument in evidence upon payment of a penalty as provided by section 34 or of duty as provided by section 36, he shall send to the 1[Deputy Commissioner]1 an authenticated copy of such instrument, together with a certificate in writing, stating the amount of duty and penalty levied in respect thereof, and shall send such amount to the 1[Deputy Commissioner]1 or to such person as he may appoint in this behalf. 1. Substituted by Act 29 of 1962 w.e.f. 1.10.1962. (2) In every other case, the person so impounding an instrument shall send it in original to the 1[Deputy Commissioner]1. 1. Substituted by Act 29 of 1962 w.e.f. 1.10.1962.

¹ Substituted by Act 29 of 1962 w.e.f. 1.10.1962.

1. (2) In every other case, the person so impounding an instrument shall send it in original to the 1[Deputy Commissioner]1.

¹ Substituted by Act 29 of 1962 w.e.f. 1.10.1962.

(1) When a copy of an instrument is sent to the 1[Deputy Commissioner]1 under sub- section (1) of section 37, he may, if he thinks fit, refund any portion of the penalty in excess of five rupees which has been paid in respect of such instrument. 1. Substituted by Act 29 of 1962 w.e.f. 1.10.1962. (2) When such instrument has been impounded only because it has been written in contravention of section 13 or section 14, the 1[Deputy Commissioner]1 may refund the whole penalty so paid. 1. Substituted by Act 29 of 1962 w.e.f. 1.10.1962.

¹ Substituted by Act 29 of 1962 w.e.f. 1.10.1962.

1. (2) When such instrument has been impounded only because it has been written in contravention of section 13 or section 14, the 1[Deputy Commissioner]1 may refund the whole penalty so paid.

¹ Substituted by Act 29 of 1962 w.e.f. 1.10.1962.

(1) When the 1[Deputy Commissioner]1 impounds any instrument under section 33, or receives any instrument sent to him under sub-section (2) of section 37, not being an instrument chargeable 1[with a duty not exceeding fifteen naye paise]1 only or a mortgage of crop [Article 1[35]1 (a) of the Schedule] chargeable under clause (a) or (b) of section 3 with a duty of twenty-five naye paise, he shall adopt the following procedure:

¹ Substituted by Act 29 of 1962 w.e.f. 1.10.1962.

1. (a) if he is of opinion that such instrument is duly stamped, or is not chargeable with duty, he shall certify by endorsement thereon that it is duly stamped, or that it is not so chargeable, as the case may be;
2. (b) if he is of opinion that such instrument is chargeable with duty and is not duly stamped he shall require the payment of the proper duty or the amount required to make up the same, together with a penalty of five rupees; or if he thinks fit; an amount not exceeding ten times the amount of the proper duty or of the deficient portion thereof, whether such amount exceeds or falls short of five rupees: Provided that, when such instrument has been impounded only because it has been written in contravention of section 13 or section 14, the 1[Deputy Commissioner]1 may, if he thinks fit, remit the whole penalty prescribed by this section.

¹ Substituted by Act 29 of 1962 w.e.f. 1.10.1962.

1. (2) 1[Subject to any orders made under Chapter VI, every certificate]1 under clause (a) of sub- section (1) shall, for the purposes of this Act be conclusive evidence of the matters stated therein.
2. (3) Where an instrument has been sent to the 1[Deputy Commissioner]1 under sub-section (2) of section 37, the 1[Deputy Commissioner]1 shall, when he has dealt with it as provided by this section, return it to the impounding officer.

¹ Substituted by Act 29 of 1962 w.e.f. 1.10.1962.

¹ Substituted by Act 29 of 1962 w.e.f. 1.10.1962.

If any instrument chargeable with duty and not duly stamped, not being an instrument chargeable 1[with a duty not exceeding fifteen naye paise]1 or a mortgage of crop [Article 1[35]1 (a) of the Schedule] chargeable under clause (a) or (b) of section 3 with a duty of twenty-five naye paise is produced by any person of his own motion before the 1[Deputy Commissioner]1 within one year from the date of its execution or first execution and such person brings to the notice of the 1[Deputy Commissioner]1 the fact that such instrument is not duly stamped and offers to pay to the 1[Deputy Commissioner]1 the amount of the proper duty, or the amount required to make up the same, and the 1[Deputy Commissioner]1 is satisfied that the omission to duly stamp such instrument has been occasioned by accident, mistake or urgent necessity, he may, instead of proceeding under sections 33 and 39, receive such amount and proceed as next hereinafter prescribed. 1. Substituted by Act 29 of 1962 w.e.f. 1.10.1962.

¹ Substituted by Act 29 of 1962 w.e.f. 1.10.1962.

1. (1) When the duty and penalty (if any) leviable in respect of any instrument have been paid under section 34, section 39 or section 40, the person admitting such instrument in evidence or the 1[Deputy Commissioner]1, as the case may be, shall certify by endorsement thereon that the proper duty or, as the case may be, the proper duty and penalty (stating the amount of each) have been levied in respect thereof and the name and residence of the person paying them.
2. (2) Every instrument so endorsed shall thereupon be admissible in evidence, and may be registered and acted upon and authenticated as if it had been duly stamped, and shall be delivered on his application in this behalf to the person from whose possession it came into the hands of the officer impounding it, or as such person may direct: Provided that,—
   • (a) no instrument which has been admitted in evidence upon payment of duty and a penalty under section 34, shall be so delivered before the expiration of one month from the date of such impounding, or if the 1[Deputy Commissioner]1 has certified that its further detention is necessary and has not cancelled such certificate;
   • (b) nothing in this section shall affect order XIII, rule 9 of the First Schedule to the Code of Civil

¹ Substituted by Act 29 of 1962 w.e.f. 1.10.1962.

¹ Substituted by Act 29 of 1962 w.e.f. 1.10.1962.

Prosecution for offence against stamp law.- The taking of proceedings or the payment of a penalty under this Chapter in respect of any instrument shall not bar the prosecution of any person who appears to have committed an offence against the law relating to stamps in respect of such instrument:

Provided that no such prosecution shall be instituted in the case of any instrument in respect of which such a penalty has been paid, unless it appears to the 1[Deputy Commissioner]1 that the offence was committed with an intention of evading payment of the proper duty.

¹ Substituted by Act 29 of 1962 w.e.f. 1.10.1962.

(1) When any duty or penalty has been paid under section 34, section 36, section 39 or section 40, by any person in respect of an instrument, and by agreement or under the provisions of section 30 or any other enactment in force at the time such instrument was executed, some other person was bound to bear the expense of providing the proper stamp for such instrument, the first-mentioned person shall be entitled to recover from such other person the amount of the duty or penalty so paid.

1. (2) For the purpose of such recovery any certificate granted in respect of such instrument under this Act shall be conclusive evidence of the matters therein certified.
2. (3) Such amount may, if the Court thinks fit, be included in any order as to costs in any suit or proceeding to which such persons are parties and in which such instrument has been tendered in evidence.

Power to Revenue authority to refund penalty or excess duty in certain cases.- (1) Where any penalty is paid under section 34 or section 39, the Chief Controlling Revenue Authority may, upon application in writing made within one year from the date of the payment, refund such penalty wholly or in part.

1. (2) Where, in the opinion of the Chief Controlling Revenue Authority, stamp duty in excess of that which is legally chargeable has been charged and paid under 1[any of the provisions of this Act]1, such authority may, upon application in writing made 1[within six months from the date of registration of the instrument or the order charging the same]1, refund the excess. 1[Provided that with the sanction of the State Government the Chief Controlling Revenue Authority may make the refund after the period specified in sub-section (1) or (2).]1

¹ Substituted by Act 6 of 1999 w.e.f. 1.4.1999

¹ Inserted by Act 29 of 1962 w.e.f. 1.10.1962.

(1) If any instrument sent to the 1[Deputy Commissioner]1 under sub-section (2) of section 37 is lost, destroyed or damaged during transmission, the person sending the same shall not be liable for such loss, destruction or damage.

¹ Substituted by Act 29 of 1962 w.e.f. 1.10.1962.

1. (2) When any instrument is about to be so sent, the person from whose possession it came into the hands of the person impounding the same, may require a copy thereof to be made at the expense of such first-mentioned person and authenticated by the person impounding such instrument.

2[(1) If the registering officer appointed under the Registration Act, 1908 (Central Act XVI of 1908) while registering 3[any instrument of,-

1. (a) Conveyance [section 2(1)(d) ]; (b) Gift [Article 28(a)]; (c) Exchange of property (Article 26); (d) Settlement (Article 48-A(i)) (e) Reconstitution of Partnership (Article 40-B (a) );
2. (f) Dissolution of partnership (Article 40-C (a) );
3. (g) An agreement to sell covered under sub-clause (i) of clause (e) of Article 5; 7[(h) a lease covered under item 8[(vi)] 8 of Article 30;] 7
   • (i) A power of Attorney covered 7[under clause (e), clause (ea) and clause (eb)]7 of Article 41;
4. (j) Release 6[(Article 45-(a)]6; (k)Conveyance under a decree or final order of any Civil Court has reason to believe]3 having regard to the estimated market value published by the Committee constituted under section 45B, if any or otherwise, that the market value of the property which is the subject matter of such instrument has not been truly set forth, he shall after arriving at the estimated market value, communicate the same to the parties and unless the parties pay the duty on the basis of such valuation, shall keep pending the process of registration and refer the matter along with a copy of such instrument to the Deputy Commissioner for determination of the market value of property and the proper duty payable thereon.]1 5[(l) Agreement [Article 5(f)]
5. (m) Award [Article 11(a)]
6. (n) Trust [Article 54 (A) (iii)]5 9[(o) Transferable Development Rights [ Article 20(7)].] 9 3. Substiuted by Act 8 of 2003 w.e.f. 1.4.2003.

¹ Inserted by Act 12 of 1975 w.e.f. 1.5.1975 in Bangalore City, Hubli-Dharwad City, Municipalities of Mysore, Mangalore, Belgaum, Gulbarga, Bellary, Davanagere, Bijapur, Shimoga and Bhadravathi and w.e.f. 1.4.1991 in other areas of the State by notification.

² Substituted by Act 24 of 1999 w.e.f. 18.8.1999.

⁴ Inserted by Act 7 of 2006 w.e.f. 1.4.2006.

⁵ Inserted by Act 7 of 2007 w.e.f. 1.4.2007.

⁶ Substituted by Act 7 of 2007 w.e.f. 1.4.2007.

⁷ Substituted by Act 9 of 2009 w.e.f..1.4.2009.

⁸ Substituted by Act 8 of 2010 w.e.f.1.4.2010.

⁹ Inserted by Act 8 of 2010 w.e.f.1.4.2010.

1. (2) On receipt of a reference under sub-section (1), the Deputy Commissioner shall, after giving the parties a reasonable opportunity of being heard and after holding an inquiry in such manner as the State Government may by rules prescribe, determine by order 1[as for as may be within ninety days from the date of receipt of such reference]1 the market value of the property which is the 2[subject matter of instrument specified in sub-section (1) and the duty payable thereon.]2 The difference, if any, in the amount of duty, shall be payable by the person liable to pay the duty. 3[with interest at twelve percent per annum if he does not pay within ninety days from the date of order of the Deputy Commissioner]3 3[Provided that the payment of interest is not applicable to instruments executed prior to 31st day of March, 2006.]3
2. (3) The Deputy Commissioner may, suo motu within two years from the date of registration of 1[any instrument specified in sub-section (1)]1 not already referred to him under sub-section (1), call for and examine the instrument for the purpose of satisfying himself as to the correctness of the market value of the property which is the 1[subject matter of any instrument specified in sub-section (1) and the duty payable thereon]1 and if after such examination he has reason to believe that the market value of such property has not been truly set forth in the instrument, he may determine by order the market value of such property and the duty payable thereon in accordance with the procedure provided for in sub-section (2). The difference, if any, in the amount of duty, shall be payable by the person liable to pay the duty 2[with interest at twelve percent per annum if he does not pay within ninety days from the date of order of the Deputy Commissioner]2: Provided that nothing in this sub-section shall apply to any instrument registered before the commencement of the Karnataka Stamp (Amendment) Act, 1975 2[Provided further that the payment of interest is not applicable to instruments executed prior to 31st day of March 2006.]2.
3. (4) The order of the Deputy Commissioner under sub-section (2) or (3) shall be communicated to the person liable to pay the duty. A copy of every such order shall be sent to the registering officer concerned.
4. (5) Any person aggrieved by an order of the Deputy Commissioner under sub-section (2) or sub- section (3) may, prefer an appeal before the 1[Regional Commissioner]1 and all such appeals shall be preferred within such time and be heard and disposed off in such manner as the State Government may by rules prescribe.]1 1[Provided that no appeal shall be admitted unless the person aggrieved has deposited, in the prescribed manner, fifty percent of the difference in the amount of duty as determined by the Deputy Commissioner under sub-section (2) or (3): 1. Proviso 1,2 and 3 inserted by Act 24 of 1999 w.e.f. 18.8.1999. Provided further that where after the determination of the market value by the Appellate Authority or determined again by the Deputy Commissioner on a remand of the case the stamp duty borne is found to be sufficient, the amount deposited shall be returned to the person concerned: 1[Provided also that such person shall pay the difference in duty along with interest at twelve percent per annum if he does not pay with in ninety days from the date of order of the Deputy Commissioner or sixty days from the date of order of the Appellate Authority, so however, the payment of interest is not applicable to instruments executed prior to eighteenth day of August 1999]1]1

¹ Inserted by Act 24 of 1999 w.e.f. 18.8.1999.

² Substituted by Act 8 of 2003 w.e.f. 1.4.2003.

³ Inserted by Act 7 of 2006 w.e.f. 1.4.2006.

¹ Substituted by Act 8 of 2003 w.e.f. 1.4.2003.

² Inserted by Act 7 of 2006 w.e.f. 1.4.2006.

² Inserted by Act 7 of 2006 w.e.f. 1.4.2006.

¹ Substituted by Act 17 of 2007 w.e.f. 5.1.2007.

¹ Substituted by Act 8 of 2003 w.e.f. 1.4.2003. 1[Explanation.- x x x ]1

¹ Omitted by Act 6 of 1999 w.e.f. 1.4.1999.

(1) The State Government shall by notification, constitute a Central Valuation Committee, under the chairmanship of Inspector General of Registration and Commissioner of Stamps, for estimation, publication and revision of market value guidelines of properties in any area in the State at such intervals and in such manner as may be prescribed, for the purpose of section 45-A.

1. (2) The Central Valuation Committee is the final authority for the formulation of policy, methodology and administration of the market value guidelines in the State and may for the said purpose constitute market valuation sub-committees in each sub-district and district comprising of such members as may be prescribed, for estimation and revision of the market value guidelines in the State. (3)Sub-committees so constituted shall function under the Central Valuation Committee and shall follows such procedures as may be prescribed and shall be subject to reconstitution whenever found necessary.]1 1. Subsections (1) to (3) substituted by Act 8 of 2003 w.e.f. 1.4.2003

² Inserted by Act 24 of 1999 w.e.f. 18.8.1999.

³ Substituted by Act 29 of 1962 w.e.f. 1.10.1962.

1[(1)] 1 All duties, penalties and other sums required to be paid under this Chapter may be recovered 2[along with simple interest at such rate as may be specified by the State Government by notification]2 by the 3[Deputy Commissioner]3 by distress and sale of the moveable property of the person from whom the same are due, or by any other process for the time being in force for the recovery of arrears of land revenue. 1. Re-numbered by Act 11 of 1991 w.e.f. 1.4.1991.

1 [2[(2) All duties, penalties and other sums required to be paid under this Chapter shall be a charge on the property which is t he subject matter of the Instrument:]2

² Inserted by Act 11 of 1991 w.e.f. 1.4.1991

1. Sub-sections (2) and (3) Substituted by Act 24 of 1999 w.e.f. 18.8.1999

Provided that the provisions of sub-section (2) shall be deemed to apply to all cases of which are pending recovery and to proceedings under sub-section (1) which have already been initiated.

1. (3) Notwithstanding anything contained in the Registration Act, 1908 (Central Act XVI of 1908), a note of such charge and its extinguishments shall be made in the indices prescribed therein and shall be deemed to be a notice under the said Act]1

(1) Where any instrument chargeable with duty has not been duly stamped, the Chief Controlling Revenue Authority or any other officer authorised by the State Government (hereinafter referred to as the authorised officer) may, within 2[five years]2 from the date of commencement of the Karnataka Stamp (Amendment) Act, 1980 or the date on which the duty became payable whichever is later, serve notice on the person by whom the duty was payable requiring him to show cause why the proper duty or the amount required to make up the same should not be collected from him: Provided that where the non-payment was by reason of fraud, collusion or any wilful mis-statement or suppression of facts or contravention of any of the provisions of this Act or of the rules made thereunder with intent to evade payment of duty, the provisions of this sub-section shall have effect, as if for the words 2[five years]2 the words 2[ten years]2 were substituted:

Provided further that nothing in this sub-section shall apply to instruments executed prior to first day of April, 1972.

¹ Inserted by Act 15 of 1980 w.e.f. 1.4.1972.

² Substituted by Act 16 of 1983 w.e.f. 1.4.1972.

Explanation.— Where the service of a notice, under this sub-section is stayed by an order of a court, the period of such stay shall be excluded in computing the aforesaid period of 1 [five years]1 or 1[ten years]1, as the case may be.

¹ Substituted by Act 16 of 1983 w.e.f. 1.4.1972.

1. (2) The Chief Controlling Revenue Authority or the authorised officer shall, after considering the representation, if any, made by the person on whom notice is served under sub-section (1), determine the amount of duty due from such person (not being in excess of the amount specified in the notice) and thereupon such person shall pay the amount so determined.
2. (3) Any person aggrieved by an order under sub-section (2), may prefer an appeal before the Karnataka Appellate Tribunal within three months from the date of such order. 1[(4) All duties payable under this section shall be recovered in accordance with provisions of section 46.]1]1

¹ Substituted by Act 24 of 1999 w.e.f. 18.8.1999.

All duties whether proper or deficit, penalties, or any other sums paid or recovered under any of the provisions of this Act shall be certified on the instruments in the manner prescribed]1

¹ Inserted by Act 24 of 1999 w.e.f. 18.8.1999.