SC overrules verdict holding unstamped agreements unenforceable, invalid

A seven-judge Constitution bench of the Supreme Court on Wednesday held that non-stamping or insufficient stamping of an agreement has nothing to do with the validity of the document as it is a curable defect.

The bench headed by Chief Justice D Y Chandrachud, in an unanimous verdict, overruled its judgement which had held that if an agreement, having arbitration clause to resolve disputes between contracting parties, is unstamped then it is invalid and unenforceable.

“The agreements that are not stamped are not rendered void (invalid). Non-stamping of an agreement is a curable defect,” held the bench which also comprised justices Sanjay Kishan Kaul, Sanjiv Khanna, B R Gavai, Surya Kant, J B Pardiwala and Manoj Misra.

Besides the CJI, who penned the judgement for himself and five other judges, Justice Khanna wrote a separate and concurring verdict.

The top court, on October 12, had reserved its verdict on reconsideration of an earlier order of its five-judge bench which had held that unstamped arbitration agreements are not enforceable in law.