Bhagwan Das Arora vs 1st Additional District Judge and Others

M.P. Mehrotra, J.—This petition under Article 226 of the Constitution of India arises out of the proceedings in a suit in the Court of Judge Small Causes Courts, Rampur.

The facts, in brief, are these. A suit was filed by Smt. Savitri Devi, Respondent No. 3 claiming a money decree against the Petitioner, who was the Defendant in the suit. It was decreed ex parte on 6th Aug., 1977. On 8th Aug., 1977 an application was moved by the Petitioner for permission to give security before filing the application for setting aside the ex parte decree under Order 9, Rule 13, Code of Civil Procedure, on the said application the Petitioner was directed to deposit in cash the amount admitted by him and to give security for the balance. Thereafter, on 31st Aug., 1977 the Petitioner (sic)ed an application under Order 9, Rule 13, CPC along with a document which purported to give the security which was directed to be furnished by him by the Court by its earlier order dated 8th Aug., 1977. A true copy of the said document is Annexure 1 to the supplementary affidavit of the Petitioner. The document is reproduced below:

Security Bond.

Whereas B.D. Arora Defendant in the abovenoted case has been directed to give security for the net admitted decretal amount in Court which comes to Rupees 2873.25 p. according to the Defendant.

I. Syed Tahir Ali son of Sayed Amjad Ali resident of Mahu Nagar Tahsil Swa, Pistrict Rampur do hereby undertake in the event of the suit being decreed, I shall be liable to pay a sum of Rs, 2,873.25 in Court for which I stand security.

Executed this day of Aug., 1977 at Rampur.

Executant.

On 21-9-1977, the Munsarim of the Court reported that the security bond had not been given on a properly stamped paper. It seems that the document bore a Court-fee stamp of Rs. 2. The Court''s office thought that the document needed to be stamped under the Stamp Act. On the said report the Court ordered that the correct stamp be supplied within a week. Thereafter on 5-10-1977 the Petitioner filed a fresh security bond stamped under the Stamp Act. However, the trial Court rejected the application under Order 9, Rule 13, CPC On the ground that there was no properly stamped security bond on 31st Aug, 1977 when the said application was moved. Properly stamped security bond according to the Court was filed on 5-10-1977. The Petitioner felt aggrieved with the order of the trial Court, a true copy of which is Annexure 3 to the petition. He accordingly filed a revision u/s 25 of the Provincial Small Cause Courts Act against the said order. The revision, however, was also dismissed by the impugned order dated 11-1-1980 a true copy of which is Annexure 4 to the petition.

Feeling aggrieved, the Petitioner has now come up in the instant petition and in support thereof, I have heard Sri B.D. Madhyan, learned Counsel for the Petitioner and in opposition, Sri J.D. Pradhan, learned Counsel for the Respondent No. 3 has made his submissions.

Sri Madhyan contended that the Courts below were wrong in thinking that the documents needed to be stamped under the Indian Stamp Act and not under the Court-fees Act. Article 6 of Schedule II of the Court-fees Act provides as follows:

Bail bond or other instrument of obligation given in pursuance of an order made by a Court or Magistrate under any section of the Code of Criminal Procedure, 1898 or the Code of Civil Procedure, 1908 and not otherwise provided for by this Act.

Learned Counsel contended that the aforesaid Article was attracted in the instant case. He placed reliance on the following case:

Kalapati Peda Pitchamma and Another Vs. Chiruvella Pedamuneyya minor by next friend Subbalakshmamma and Another, , on the other hand the learned Counsel for the aforesaid Respondent placed reliance on the Division Bench pronouncement reported in Kasemali Vs. Ajoyendu Paul and Others, which in its turn relied upon Baburao Keshavrao Malkapure Vs. Kalavatibai Amrutrao Khase, . The learned Counsel also placed reliance on Krishan Kumar v. Hakim Mohammad Umar (1978) 4 All LR 541) : (1978 All LJ 738).

In the aforesaid Madras Full Bench Case it was held that an order passed under the proviso to Section 17(1) of the Provincial Small Cause Courts Act is also an order passed under CPC and the Provincial Small Cause Courts Act is only supplemental to the Code of Civil Procedure. On this basis it was held that the security bond executed by a surety submitted under the proviso to Section 17(1) of the Provincial Small Cause Courts Act would be covered by Article 6, Schedule II of the Court-fees Act and not by Article 15 of the Stamp Act. This view was expressly dissented from in Kasemali Vs. Ajoyendu Paul and Others, where the Court observed as follows:

With great respect to the learned Judges of the Madras High Court, I am of opinion that the view that the bond given in accordance with the provision of the Section 17, Provincial Small Cause Courts Act is a bond given under the CPC is not correct, Whether the procedure laid down in the Provincial Small Cause Courts Act can be correctly called supplemental to the CPC or not is of little consequence.

The fact remains that the proviso as enacted in Section 17(1) Provincial Small cause Courts Act is not in the Code of Civil Procedure, Order 9, Rule 13. CPC may properly be said to be a section of the Code of Civil Procedure. If Order 9, Rule 13 had provided for any order for a bond, the bond might have been considered to have been given under an order passed under the Code of Civil Procedure.

Order 9, Rule 13 however does not contain any such provision. The plain and simple fact is that the provision of law under which the order directing a security bond to be given is passed is embodied in the Provincial Small Cause Courts Act; and I can see no reason why I should accept the fiction that such an order is passed under the Code of Civil Procedure, in place of the fact that it is given under the provisions of Section 17, Provincial Small Cause Courts Act.

My conclusion, therefore, is that the law does not require this security bond to be affixed with any Court-fee stamp and consequently having been written on stamp paper in accordance with Stamp Act, the bond was proper and sufficient in so far as the matter of stamps was concerned.

As stated above in the said Kasemali''s decision reliance was placed upon AJB 1940 Bom 275 (Special Bench) though in the said case the bond given was under the Guardians and Wards Act. In my view the Calcutta decision is to be preferred to the Madras case. Further it should be seen that in the Madras case the controversy was examined with reference to Article 15 of the Stamp Act which deals with bonds and lays down that the said Article will be applicable when it is not otherwise provided for by the Stamp Act or by the Court-fees Act. In other words Article 15 is a residuary Article and expressly excepts Court-fees Act. However, in the instant case Article 57 will be applicable which lays down as follows:

57 Security Bond or Mortgage Deed executed by way of security for the due execution of an office, or to account for money or other property received by (sic)ritue thereof, or executed by a surety to secure the due performance of a con-(sic)act of the due discharge of a ability

(a) When the amount The same duty secured does not as a Bond (No. exceed Rs. 1,000; 15) for the amount secured. (b) In any other Thirty seven case. rupees seventy five paise.

This article unlike Article 15 does not except the Court-fees Act. It is. therefore, clear that even if Article 6 of Schedule II of the Court-fees Act were to be held to be applicable still, if Article 57 is also held to be applicable then duty would be payable both under the Court-fees Act as well as under the Stamp Act. This has been made clear in Section 77 of the Indian Stamp Act which lays down as follows:

Having as to Court-fees.- (Except the provisions as to copies contained in Section 6A) nothing in this Act contained shall be deemed to affect the duties chargeable under any enactment for the time being in force relating to Court-fees.

It has not been shown to me why Article 57 will not apply to the document in question. Therefore, Stamp Duty was payable under this Article and admittedly it was not paid within the period of limitation. It has already been stated above that the ex parte decree was passed on 6-8-1977 and the fresh surely bond was filed on 5-10-1977 which was duly stamped under the Stamp Act.

The first contention of Sri Madhyan is, therefore, rejected on two grounds firstly because I have already held that the Article 6 of the Schedule II of the Court-fees Act was not attracted to the instant case inasmuch as the security was furnished in pursuance of an order made by a Court, not under the CPC but under the proviso to Section 17(1) of the Provincial Small Cause Courts Act. I have already expressed my preference for the aforesaid Calcutta view in comparison to the aforementioned Madras view which I have also otherwise distinguished. The recent Supreme Court decision in Vishesh Kumar Vs. Shanti Prasad, also strengthens the view that the Provincial Small Cause Courts Act is in the nature of self contained Code and the applicability of the CPC is restricted or qualified to the trial of the suits in the Courts of Small Causes, Lastly Krishan Kumar v. Hakim Mohammad Umar ((1978) 4 All LR 541) : (1978 All LJ 738) also supports the contention that the security bond furnished under the proviso to Section 17(1) of the Provincial Small Cause Courts Act is chargeable to duty under the Stamp Act.

A reference was also made by the learned Counsel for the Respondent No. 3 to Hindustan Sugar Mills Ltd. Vs. State of U.P. and Others, . In my view the same is not applicable to facts of this case.

Sri Madhyan''s next contention, that once the notice has been issued by the Court then the Court cannot rejecl the security bond and the same should be treated as having been accepted as sufficient He placed reliance upon the following cases.

Ram Bharose Vs. Ganga Singh ;

In Re: Stamp Reference (Jangilal) ;

Ahmad Yar Khan Vs. Kheyali ;

Kirpa Shanker Vs. Brahmanand, ;

Marimuthu Goundar v. Ponnammal AIR 1956 Mad 422;

Dullan Prasad Vs. Smt. Rajeshwari Bibi, ;

Kiran Koomar Banerji Vs. Baij Nath ;

Mahabir v. Sheo Saran AIR 1936 Oudh 407;

Azmatulla Khan Vs. Ahmad Ali, ;

State Bank of Hyderabad v. Kotha Papi Reddy AIR 1975 Andh Pra 25.

11 In Re: Chargeability of Stamp Duty, .

Barkat Ram v. Suggar Electric Stqres, Ludhiana AIR 1936 Lah 140;

On the other hand Sri Pradhan placed reliance on the following cases:

Lala Mool Chand v. Niranjan Singh AIR 1922 All 265(1);

2, Hira Lal v. Cheda AIR 1948 Oudh 41;

Mt. Sonkali Vs. Mahabir Dube, ;

Khetra Dolai Vs. Mohan Bissoyi, .

It is not necessary to discuss the aforesaid cases in detail because they will not be found to be applicable in the facts of the instant case. Many of the cases had to deal With the law as it stood before the amendment in the proviso to Section 17(1) which was affected by the Provincial Small Cause Courts (Amendments) Act IX of 1935. In many of the aforesaid cases the point was emphasised that a party should not suffer on account of the mistake of the Court. It should be seen that in the instant case the clear position was that on 31st Aug. 1975, when the application under Order 9, Rule 13, CPC was moved, the security bond was not duly stamped under the Indian Stamp Act. Long after the expiry of the period of limitation a fresh security bond was filed which was duly stamped under the Stamp Act. In such circumstances in my view the Courts below correctly held that there was no compliance with th proviso to Section 17(1) of the Act. Unlike many of the cases referred lo above, in the instant case the Court did not accept the security offered. The security bond was found to be defective inasmuch as it was not properly stamped. Section 35 of Indian Stamp Act clearly lays down that such an instrument shall not be admitted in evidence for any purpose and shall pot be acted upon unless it is duly stamped. It is not a case where it can be said that the Petitioner suffered because of any mistake of the Court.

This petition, accordingly, fails and is dismissed but there will be no order as to costs.