Report No. 67
22.22. Recommendation of amend section 64(c).-
In the light of the above discussion, we recommend that section 64(c) should be revised as follows:
Revised section 64(c)
64. Any person who, with intent to defraud the Government-
(c) Makes any false statement calculated to deprive the Government of any duty or penalty under this Act, shall be punishable with fine which may extend to five thousand rupees.
We may mention that the suggested amendment has been favoured by most of the replies to our Questionnaire.1
1. Question 68 [Section 64(c)].
22.23. Section 65-Amendment.-Section 65 punishes any person who-
(a) being required under section 30 to give a receipt, refuses or neglects to give the same; or
(b) with intent to defraud the Government of any duty, upon a payment of money or delivery of property exceeding twenty rupees in amount or value, gives a receipt for an amount or value not exceeding twenty rupees, or separates or divides the money or property paid or delivered.
The punishment is fine which may extend to one hundred rupees.
The amount "twenty rupees" should be replaced by "one hundred rupees"1 in view of section 30 as proposed.
1. Cf. amendment as to section 30.
22.24. Section 66.-According to section 66, any person who-
(a) receives, or takes credit for, any premium or consideration for any contract of insurance and does not, within one month after receiving, or taking creditor, such premium, or consideration, make out and execute a duly stamped policy of such insurance, or
(b) makes, executes or delivers out any policy which is not duly stamped, or pays or allows in account, or agrees to pay or allow in account, any money upon, or in respect of, any such policy, shall be punishable with fine which may extend to two hundred rupees. We have no comments on this section.
22.25. Section 67.-
Section 67 punishes any person drawing ,or executing a bill of exchange (payable otherwise than on demand) or a policy of marine insurance purporting to be drawn or executed in a set of two or more, and not at the same time drawing or executing on paper duly stamped the whole number of bills or policies of which such bill or policy purports the set to consist. The punishment is fine which may extend to one thousand rupees. Though the language is somewhat involved, the substance is clear, and needs no change.
22.26. Section 68.-
Penalty for post-dating bills, and for other devices to defraud the revenue.-Section 68 is important, and may be quoted in full.
"68. Any person who-
(a) with intent to defraud the Government of duty, draws, makes or issues any bill of exchange or promissory note bearing a date subsequent to that on which such bill or note is actually drawn or made; or
(b) knowing that such bill or note has been so post-dated, endorses, transfers, presents for acceptance or payment, pr accepts, pays or receives payment of, such bill or note, or in any manner negotiates the same; or
(c) with the like intent, practises or is concerned in any act, contrivance or device not specially provided for by this Act or any other law for the time being in force; shall be punishable with fine which may extend to one thousand rupees." With reference to this section, we have offered our comments under section 64.1
It may be noted that clause (c) is new, and seems to have been modelled on section 21 of the Stamp Duties Management Act, 1891 (English), which reads as follows:2
"21. Any person who practises or is concerned in any fraudulent act, contrivance or device not specially provided for by law, with intent to defraud Her Majesty of any duty, shall incur a fine of 50 pounds."
No change is needed in the section.
1. See discussion as to s. 64, supra.
2. Section 21, Stamp Duties Management Act, 1891 (English).
22.27. Section 69.-
Section 69 punishes-
(a) any person appointed to sell stamps who disobeys any rule made under section 74, and
(b) also any person not so appointed who sells or offers for sale any stamp other than 10 naye paise or 5 naye paise adhesive stamp.
The punishment is imprisonment upto six months or fine upto Rs. 500, or both. In so far as the section relates to private persons dealt with in clause (b), the prohibition against the sale of stamps by a private person is, in our opinion, too widely worded, inasmuch as a person having surplus stamps which he purchases bona fide, is prohibited from passing them on for consideration to another person who requires them. It is, in our view desirable that the prohibition in clause (b), should be restricted to persons who sell stamps as business, and not to persons who have to sell a stamp in an isolated transaction.
22.28. Position in England.-
It may be noted that in England, the penalty is not for unauthorised sale of stamps or private sale of stamps, but only for unauthorised dealing in stamps. The relevant provision1 is quoted below:
"4.(1) If any person who is not duly appointed to sell and distribute stamps deals in any manner in stamps, without being licensed so to do, or at any house, shop, or place not specified in his licence, he shall for every such offence incur a fine of twenty pounds.
(2) If any person who is not duly appointed to sell and distribute stamps, or duly licensed to deal in stamps, has, or puts upon his premises either in the inside or on the outside thereof, or upon any board or any material whatever exposed to public view, and whether the same be affixed to his promises or not, any letters import in or intending to import that he deals in stamps, or is licensed so to do, he shall incur a fine of ten pounds."
1. Section 4(1), Stamp Duties Management Act, 1891 (54 and 55 Vict., C. 38).
22.29. Need for amendment.-
We are of the view that since there can hardly be any serious abuse when the sale is confined to isolated transactions, the English provision is preferable in substance. In the present scheme of the Act, a person who has unused stamp has to approach the Collector and obtain refund under section 49 or section 50. This procedure is cumbersome, and it also involves a deduction of percentage. Further, section 54(c) imposes a limitation of 6 months for grant of such refund. This position causes hardship to a person who happens to have in his possession, unused stamps where there is a person ready and willing to purchase them. We do not think that there will be any loss of magnitude to Government if such persons are permitted to transfer such stamps. Nor do we think that such an amendment will create any serious scope for sale of forged stamps. We therefore recommend that section E9(b) should be revised so as to read-
"(b) any person not so appointed who carries on the business of dealing in stamps other than 10 naye paise or 5 naye paise adhesive stamps".