Shaikh Ahajuddin Molla vs Kharam Ali Molla

P.N. Mookerjee, J.—The Appellant before me was the Defendant in a suit brought by the present Respondent for recovery of a sum of Its. 600 on account of a loan, advanced by the Respondent to the Appellant. Along with the plaint, a document was filed in support of the Plaintiff''s case of loan, which document was described as an "on demand promissory "note." As a promissory note, however, it was insufficiently stamped and the learned Munsif, having held that the suit was a suit for recovery of the dues on a promissory note, came to the conclusion that it must fail as the insufficiently stamped promissory note could not be used in evidence.

On appeal, however, the learned District Judge has reversed the decision of the learned Munsif upon the view that the suit, on the plaint as it stands, is a suit for recovery of a loan independently of the promissory note, or, in other words, that it is a suit on the original consideration, and, accordingly, it is clearly maintainable in law and, further, that the document in question is not really a promissory note under the Stamp Act but is a bond within the meaning of that statute, and, accordingly, it should be impounded and, after realisation of the deficit stamp from the Plaintiff, it should be allowed to be used in evidence. That had actually been done by the learned Munsif at a preliminary stage before him (though, at the trial, the learned Munsif took a different view), when the impugned document was held to be a "bond" and it was impounded and deficit stamp and penalty were duly realised from the Plaintiff. It was, however, not admitted in evidence so as to attract Section 36 of the Stamp Act.

The learned District Judge has, accordingly, set aside the decision of the learned Munsif and sent back the case to him for determination of the issues between the parties and for final disposal of the suit in accordance with law in the light of his judgment. Against this order of remand, the present appeal has been filed by the Defendant.

Before me two points have been taken by Mr. Saha who appears for the Defendant-Appellant. In the first place, it has been contended that the learned District Judge was not justified in treating the suit as a suit on the original consideration. In my view, although there are certain unhappy expressions in the plaint if it is read as a whole, it would plainly support that case of a claim on the original consideration. I do not, therefore, find any reason to interfere with this finding of the learned District Judge.

On the other part of the case, it has been contended by Mr. Saha that the document in question could not be regarded as a bond and should be held to be a promissory note and, being admittedly insufficiently stamped, it should be ruled out from evidence. In my opinion, this contention of the Appellant too cannot be accepted. The document in question no doubt contains a promise to pay a certain amount of money with interest, but there is no expression in it to show that it was payable to the order of any person or "to the bearer of the "instrument". It is therefore "not payable to order or bearer". It is also "attested by a witness". It thus contains all the essential elements of a bond as denned in Section 2(5)(b) of the Indian Stamp Act. It is, therefore, clearly a bond within the meaning of the Stamp Act. It is also not a promissory note under that Act, as the definition of a promissory note, as contained in Section 2(22) is in these terms:

"Promissory note" means a promissory note as defined by the Negotiable Instruments Act, 1881. and a promissory note, as denned in this latter Act (vidie Section 4), is in these terms:

A "promissory note" is an instrument in writing (not being a bank-note or a currency-note) containing an unconditional undertaking, signed by the maker, to pay a certain sum of money only, to, or to the order of, a certain person, or to the bearer of the instrument.

As already stated, the order element or the "bearer" part is absent in the present document. It is, therefore, not a promissory note, as denned by the Negotiable Instrument Act, that is, within the meaning of the definition in Section 4 of that Act, and, accordingly, it is not a promissory note within the meaning of the Stamp Act also, (vide, Venlu v. Sitaram I.L.R.(1904) (Bom.) 82; Mohamad Sadik v. Amiya Nath Dutt (1917) 41 I.C. 693 Kararam v. Malta Chenffama (1906) 43 I.C. 55).

It is argued, however, that Section 13(1), Explanation (i) of the Negotiable Instrument Act which was introduced by the Amending Act VIII of 1919, long after the enactment of the Stamp Act, and which is in these terms:

A promissory note, bill of exchange or cheque is payable to order which is expressed to be so payable or which is expressed to be payable to a particular person, and does not contain words prohibiting transfer or indicating an intention that it shall not be transferable.

supplies the omission in the present document and makes it also payable to the order of the addressee or "payable to order", as there are no words of prohibition, as indicated in the last part of the Explanation, quoted above.

I am unable to accept this argument for the simple reason that the definition of a promissory note in the Stamp Act merely refers to the definition of a promissory note in the Negotiable Instruments Act which attracts only the definition in Section 4 of this latter Act and no other section thereof. The utmost that can be said is that the definition, as contained in the Negotiable Instruments Act, is to be bodily carried and read into Section 2(22) of the Stamp Act. Section 13(1), Explanation (i) of the Negotiable Instruments Act would not, therefore, be attracted by the above reference in the Stamp Act to the definition in the Negotiable Instruments Act, that is, by the reference to the said definition in Section 2(22) of the Indian Stamp Act. Clearly, then the document before us would not be a promissory note within the meaning of the Indian Stamp Act. This view is supported by the Bench decision of this Court in the case of Khetra Mohan Saha v. Jamini Kanta Dewan ILR (1927) Cal. 445, Veerappudayan Vs. Oganthappudayan, . My conclusion is also supported by the principle enunciated and the line of reasoning indicated in the decision of the Judicial Committee in the case of (1931) L.R. 58 I.A. 259 (Privy Council) , where the effect of the reference of an earlier Act in a latter Act in the light of subsequent amendments in the earlier Act was considered by their Lordships. I would, accordingly, hold that the learned District Judge was right also in his view that the document in question was a "bond" and not a promissory note within the meaning of the Indian Stamp Act and that, therefore, it was open to the court to impound it and, after realisation of the deficit stamp and penalty (which has already been done by the learned Munsif in this case), to accept it in evidence. That is clearly permissible under proviso (a) to the offending Section 35 of the Stamp Act which is set up as the only bar to the admissibility of the document in evidence.

In the above view of the matter, I uphold the decision of the learned District Judge and dismiss this appeal.

There will be no order as to costs in this Court.