Recently, the Andhra Pradesh High Court ordered the impounding of Power of Attorney (GPA) which was executed outside India. The General Power Of Attorney was not stamped within 3 months after it had been first received in India as per Section 18 of Indian Stamp Act, 1899.
"Though the instrument was executed outside India and it was not duly stamped and presented before 3rd respondent within the period of three months, the said authority can impound the same and collect the required stamp duty and penalty and validate the document."
It was made clear by the Court that the Registrar's action in rejecting the document cannot be countenanced.
FACTS OF THE CASE IN BRIEF
It was challenged in the writ petition that the District Registrar, Vijayawada refused to receive the General Power of Attorney which was executed by the writ petitioner's sister who was a resident of Canada in favour of writ petitioner authorizing him to act as her General Power of Attorney to sell her residential property.
The General Power of Attorney was rejected on the ground that it was executed, notarized and the same was received in India by 6th March 2020. But the GPA was presented on 21st December 2021 which was more than 3 months after the document was received in India for validation purpose. It was said to be violation of the Indian Stamp Act, 1899. As the document was presented after expiry of limitation period of 3 months as envisaged in Section 18 of Stamps Act and the General Power of Attorney was refused.
It was submitted by the Counsel for Petitioner that the COVID lockdown was imposed throughout the country and because of which the petitioner could not move out. The Supreme Court in its suo-motu order had extended the period limitation for suits, appeals, applications or proceedings. It was argued by the Government Pleader that the Supreme Court order mainly applied to suits, appeals and other judicial proceedings which could not be filed due to COVID restrictions. But the case of the petitioner was not a judicial proceeding.
THE COURT’S CONSIDERATION
It was noted by the Court that according to the Section 3 of the Stamps Act and Article 48 in Schedule I of the Act, a power of attorney executed outside India and received in India relating to any property situated in India, it is excisable to stamp duty. The Section 18 of the Stamps Act states that every instrument chargeable with duty executed only out of India may be stamped within 3 months after it has been first received in India.
It was admitted by the petitioner that the procedure envisaged in Section 18 of the Indian Stamp Act needed to be followed. It was also noted by the court that the petitioner had not produced any relevant material to show that there were continuous lockdown orders imposed due to which he could not move out. Moreover, the benefit of exclusion of the limitation was applicable to only proceedings instituted in courts or tribunals.
Justice U. Durga Prasad relied on the decision of the Supreme Court in the Malaysian Airline Systems BHD Vs STIC Travels (P) Ltd and held that the said authority could impound the instrument executed outside India but not duly stamped and collect the required stamp duty and penalty and validate the document.
The writ petition was allowed. It was clarified by the Court that if the document like the Power of Attorney was executed outside India on Indian non-judicial stamp paper before or at the time of its execution, Section 18 of Stamps Act will not be applied.
The Case title is Pedapudi Alfred Johnson Jeyakaran Jesudasan V. The State of Andhra Pradesh.
