TMI Blog1936 (4) TMI 13X X X X Extracts X X X X X X X X Extracts X X X X ..... he decided this issue as a preliminary point in favour of the defendants, holding that the document was a promissory note, was improperly stamped, and therefore was inadmissible in evidence for any purpose under Section 35 of the Indian Stamp Act. Their Lordships will discuss this decision later. Leave, however, was given to the plaintiff to amend : and on January 2, 1931, the plaintiff presented an amended plaint alleging that on April 1, 1917, it was agreed between the plaintiff and the defendants that the plaintiff should deposit ₹ 43,900 with the defendants for a period of two years with interest at five and a quarter per cent, per annum : and that at the expiration of the two years the amount was allowed to remain in deposit with the defendants on the condition that the plaintiff would be at liberty to recover the amount with interest at any time he liked, and that interest would be credited annually in the books of the defendants. The defendants in their respective written statements denied that there was any agreement apart from that recorded in the inadmissible promissory note. They denied any agreement in 1919, they pleaded the Statute of Limitation, and finally ple ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Singh said that in 1917 he had taken some land on mortgage from one Hamish Gul. He, Hamish Lal, had acquired the land by preemption and 42,500 had to be deposited as pre-emption money, which was found by the defendant Attar Singh. He took a loan from the plaintiff for 43,900 at five and a quarter per cent, interest : wrote a promissory note for this and gave it to the plaintiff himself. No mention was made of the money being placed on deposit. He made no agreement with the plaintiff after the expiration of two years to keep the money on deposit. After two years he repaid the money and the interest. His father and he both went to the plaintiff and his father paid the money. 3. The defendants' story about the payment of the money was not accepted by either of the Courts in India. The absence of any receipt, the non-return of the alleged promissory note, and the failure by the defendants to produce any books dealing with the transaction amply support the finding of the trial Judge in this respect. The defence therefore had to rest upon the Indian Limitation Act, a defence meritorious enough where the defendant has been left in long enjoyment of property : or where from the laps ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation of the depositee to repay. It is unnecessary, however, in this case to decide any question as to implied conditions, for the case of the plaintiff rests on an express stipulation made in 1919. 5. Before however coming to a final decision as to the rights of the parties it seems necessary to discuss the point decided by the trial Judge that the document signed by the defendants in 1917 was a promissory note and inadmissible because improperly stamped. No objection to this ruling appears to have been taken on the hearing of the appeal : but their Lordships thought right to allow the point to be raised before them, as it involves no question of fact : on the other hand the determination of the issue as to whether any and what agreement was made in 1919 is much embarrassed by the Court having to deal with a fund as it were in vacuo, with no evidence admissible as to how there came to be any sum in the hands of the defendants at that date. 6. Having heard the discussion their Lordships have come to the conclusion that the document was not a promissory note. The Indian Stamp Act does not suffer from the defect of the English Stamp Act in ignoring the definitions in the Bills ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it must be negotiable, for there appear to be no words prohibiting transfer or indicating an intention that it should not be transferable. It must be admitted that it would be a somewhat unusual visitor in the accustomed circles of negotiable paper. It is indeed doubtful whether a document can properly be styled a promissory note which does not contain an undertaking to pay, not merely an undertaking which has to be inferred from the words used. It is plain that the implied promise to pay arising from an acknowledgment of a debt will not suffice, for the third illustration indicates that an IOU is not a promissory note, though of the implied promise to pay there can be no doubt. The second illustration however seems to show that the express words I promise or I undertake are unnecessary. The form of words is taken from an early English case, Casborne v. Dutton, reported in Selwyn's Law of Nisi Prius, 13th Edn., p. 329, from Scacc. M. I Geo. II MSS., where according to the learned author the Court stated that the words to be paid in the document there sued on amounted to a promise to pay : observing that the same words in a lease would amount to a covenant to pay rent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... admissibility of the document was that it recorded the terms of a contract reduced to the form of this document, and that under Sections 91 and 92 of the Indian Evidence Act no oral evidence was admissible to contradict, vary, add to, or subtract from its terms. The answer is that the document does not record or purport to record all the terms of the contract between the parties. There is nothing in the document which explains how the money came to be received : and nothing to prevent the parties from showing that it was paid by way of loan, deposit, or on account of some joint adventure. The use of the money might have been limited in various ways. The only terms which the document does express are as to the date of repayment of the money expressed to be received and as to the rate of interest. These terms the defendants do not now seek to contradict vary add to or subtract from. The Board therefore can proceed to examine the evidence untrammelled by the restriction imposed upon themselves unnecessarily as now appears by the Courts below of having to disregard the receipt or evidence as to the actual transaction in 1917. Their Lordships see no reason for rejecting the plaintiff&# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nowingly suborned false witnesses, there could be no doubt as to the result of his claim. But no evidence nor any cross-examination was directed against the plaintiff in this respect, and in his evidence he makes no reference to corroborative witnesses being present. It was considered in the judgment under appeal that the fact that the plaintiff in 1925 demanded payment of the debt of ₹ 25,000 which bore a rate of interest of six per cent, per annum without demanding payment of the present debt which only bore a rate of five and a quarter per cent, threw some doubt on the plaintiff's case. Again the plaintiff was not asked about this and it would not be difficult to suggest reasons why a creditor might be willing to leave a larger sum outstanding even at a lower rate of interest if he were not dissatisfied with the credit of his debtor. It seems also to be overlooked that the difficulty, if difficulty there be, applies equally to the only other alternative view that there was a loan outstanding but that it was not payable on demand. That some arrangement was made at the end of 1919 accounting for the non-payment at the stipulated date and in succeeding years seems certain ..... X X X X Extracts X X X X X X X X Extracts X X X X
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