MUTHU GOUNDER Vs. PERUMAYAMMAL

JUDGEMENT

(1.) These appeals involve the decision of a common and only question, viz, whether the document on which the respective suits are laid is inadmissible by reason of the provisions of Section 35 of the Stamp Act. The trial Court gave the answer in the affirmative and dismissed the suits while the appellate Court Came to the opposite conclusion and decreed them.

(2.) The operative terms of the documents in the two appeals are identical and they ate to the following effect: "The on demand executed on 21-2-1950 by ...... I promise to pay you or your order after a period of two years on demand by you the principal together with interest the sum of Rs. ....... " The documents are stamped with four anna revenue stamps. It is not disputed that if the documents were held to be promissory notes within the definition contained in Section 2, Sub-clause (22) of the Stamp Act, they must be held to be insufficiently stamped; they being payable otherwise On demand, the proper duty would be governed by Article 49 (b) of the Act, that is, duty as on a bill of exchange for the amounts covered by them. The question is whether the suit documents could be said to be promissory notes.

(3.) Under Section 2(22) of the Stamp Act, a promissory note is one that would come within the definition contained in Section 4 of the Negotiable Instruments Act and would include a note promising payment of any sum of money out of any particular fund which may or may not be available or upon any condition or contingency which may or may not be performed or happen, A promissory note may be payable on demand or at a fixed determinable point of time. But in every case there should be an unconditial undertaking to pay a certain sum of money to or to the order of a certain person or bearer.