Unregistered Sale Agreement Delivering Possession Can't Be Marked As Evidence Without Payment Of Stamp Duty: AP High Court

The Andhra Pradesh High Court has held that where an agreement of sale specifically recites delivery of possession, the document attracts stamp duty and penalty, and cannot be received in evidence unless it is duly stamped. 

Dismissing a Civil Revision Petition, Justice Venkateswarlu Nimmagadda upheld the trial court's order refusing to mark an unregistered agreement of sale-cum-possession as an exhibit in a suit for specific performance. 

The court observed:

"But in the case on hand, the instrument is named as “agreement of salecum-possession”. Much less, the plaintiff/petitioner also pleaded that he has been in possession and enjoyment of the property not only in the plaint but also in his chief evidence affidavit before the Court at trial. Therefore, since there is a specific recital with regard to delivery of the possession of the property under an agreement of sale, the levy of stamp duty and penalty is always in relation to the description of the document and levy cannot depend upon the pleadings of the parties.

The levy of the stamp duty and penalty is always in relation to the document which is to be marked before the Court and such levy cannot depend upon the pleadings of the parties. Unless the document is sufficiently stamped it cannot be marked even for collateral purpose."

The case arose from a suit for specific performance filed on the basis of an unregistered agreement of sale-cum-possession. The plaintiff claimed that the defendant had agreed to sell the suit property for Rs. 25 lakh, delivered possession of the property along with the original title documents, and later failed to execute the sale deed despite a legal notice.

During the pendency of the suit, the plaintiff alleged that the defendant forcibly dispossessed him, leading to amendment of the plaint to seek recovery of possession in addition to specific performance.

When the plaintiff sought to mark the unregistered agreement as an exhibit, the trial court refused, holding that it was an agreement of sale-cum-possession and, in the absence of payment of the required stamp duty and penalty, could not be admitted in evidence. Aggrieved, the plaintiff approached the High Court.

The issue for determination before the Court was whether an agreement of sale-cum-possession can be received in evidence or marked as an exhibit without payment of the stamp duty and penalty required under the Indian Stamp Act, 1899, and without registration as mandated under the Registration Act, 1908.

Before the High Court, the petitioner contended that, under the proviso to Section 49 of the Registration Act, 1908, the unregistered agreement of sale was admissible in evidence in a suit for specific performance. He further argued that, having been dispossessed after filing the suit and with the respondent denying his possession, the document should be treated as an agreement of sale and not an agreement of sale-cum-possession.

The respondent emphasized that the levy of stamp duty is determined by the nature and recitals of the document and not by the pleadings of the parties.

Accepting the respondent's contention, the High Court held that the document was an agreement of sale-cum-possession containing a recital of delivery of possession. It held that stamp duty and penalty are determined by the description and recitals of the document, not by the parties' pleadings, and that an insufficiently stamped document cannot be marked even for a collateral purpose. Accordingly, it dismissed the Civil Revision Petition and upheld the trial court's order refusing to mark the unregistered agreement of sale-cum-possession as an exhibit.

Case Title: Devathi Ravi Kumar v. Smt. Botla Rama Devi

Case No.: Civil Revision Petition No. 957 of 2026

Counsel for the Petitioner: Sri Anjaneya Sarma M.

Counsel for the Respondent: Sri G. Venkata Reddy.

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