E SUBRAMANIYAN Vs. J N ESUPATHAM

JUDGEMENT

(1.) PLAINTIFF filed O.S.No. 148 of 1992 for recovery of certain amount due on a promissory note dated 9 -7 -1989. The promissory note was executed for a sum of Rs.50,000/ - with interest at 9% per annum. There is no words on -no demand - in the Promissory note. Hence the trial court came to the conclusion that it is a promissory note, otherwise payable on demand, and therefore the stamp duty, is payable as per Sec. 49(b) of the Stamp Act. Accordingly, the plaintiff was directed to pay stamp duty of Rs.300/ - and penalty of Rs.3,000/ - before 10 -6 -1994. It is againt that order, the present revision has been preferred by the plaintiff. According to learned counsel apperaing for the plaintiff/petitioner, the trial Court was not correct in stating that the promissory note in question is one otherwise payable on demand, and, therefore, the stamp duty is payable under Sec. 49(b) of the Stamp Act. According to learned counsel, the promisory note is stamped properly under Section 49 (a) of the Stamp Act. According to learned Counsel., even though the words -on demand - is not present in the promissory note, the promissory note is payable only on demand. According to learned counsel there is no time limit fixed for payment of the amount due under the promissory note. Therefore, it will not come under Art. 49(b) of the Stamp Act. Learned Counsel further submitted that in the decision reported in Thenappa v. Andiyappa (AIR 1971 Mad. 290) the facts are different. According to the facts arising therein in that case in the promissory ntoe, the promissor undertook to pay the amount due on the promissory note after two years. Therefore in that caseit was held that the promissory note was payable otherwise than on demand within the meaning of Art.49(b) of the Stamp Act. So also in the decision reported in the case of Devassya v. Samshuddin, (1976 KLT 24) it was held that, -if the time is specified in the document and if the same is payable on demand after the period, still the document is promissory note payable otherwise than on demand, falling under Art. 49(b) of the Stamp Act. Therefore, according to learned counsel for the petitioner, this decision is also not applicable to the facts of the present case. It was, therefore, pleaded that the trial court was not correct in directing the plaintiff to pay the stamp duty and penalty in view ofArt.49(b) of the Stamp Act.

(2.) NONE appeared for the respondent, even though notice was served on the respondent and the name of the respondent was printed in the caste - list.

(3.) IN Sreenivasan v. Subbarama Sastrikal , (AIR 1988 Ker. 112) it was held that -a promissory note payable on demand is one payable without any demand and time limit. The true import of the words -on demand - is that the debt is due and payable immediately. The instrument involved in this case satisfied this test even read along with the endorsement. The endorsement does not mean that it is not payable immediately or without any demand. Even the words -on demand - is not necessary to make it on demand because under 5.19 of the Negotiable Instruments Act a pronote in which no time for payment is specified is one payable on demand. - In order to make a promissory note -on demand - it must be payable -at once - -forthwith - or -immediately -. The expression -on demand - unlike in ordinary parlance, has, a technical connotation in the law of negotiable instruments. If any time is fixed for payment then payment could be demanded and the amount becomes payable only after that period and in such a case the instrument is only one payable otherwise than on demand even though the words -on demand - are there. The decisions reported in Aiyappankutty v. Mathai, (1954 KLT 785) Thenappa v. Andiyappa, (AIR 1971 Mad. 290) and Devassya v. Shamsuddin (1976 KLT 24) were concerned with instruments where periods were fixed for payment. When time for payment is fixed a promissory note cannot be payable -on demand - whatever be the wording. But in the present case no period for payment was fixed under the promissory note and, therefore, the decisions relied upon by the trial court are not applicable to the facts of this case. The promissory note in question is correctly stamped according to the provisions contained in Art.49(a)of the Stamps Act. Therefor e, the order passed by the trial court in holding that the promissory note in question is a promissory note otherwise payable on demand and necessary stamp duty is payable according to Art. 49(b) of the Stamps Act is liable to be set aside. Accordingly, I set aside the order of the trial court.