SUPERINTENDENT OF STAMPS Vs. RAMKRISHNALAL DAHYABHAI

JUDGEMENT

(1.) THIS is a reference under Section 57 of the Indian Stamp Act, 1899. The question which is referred to this full bench is whether all or any of the notes (there are five memoranda in all) are chargeable with duty under Article 43 (a) of the first schedule to the Act or whether the said notes or any of them are exempt from stamp duty under Exemption (a) to Article 5 of the Indian Stamp Act.

(2.) THE matter originally came before this Court consisting of my learned brothers Divatia and Macklin and myself, and we adjourned the reference and sent it back, because we were not satisfied that the statements contained in the case were sufficient to enable us to determine the question referred to us, and we called for certain rules and regulations, if any, mentioned in each contract note with regard to the commodity mentioned therein. We directed that if there were no rules and regulations in respect of any commodity, then the necessary affidavit was to be filed to that effect.

(3.) NOW, the matter is obviously one of considerable importance, because these pakka adat contracts, which are a feature of this city, are greatly in use in the commercial community, and it would appear that the persons who are concerned with these dealings have never considered that the relevant memoranda are subject to stamp duty. The material articles under the Indian Stamp Act are as follows. By Section 3 of the Act it is provided that subject to the provisionis of this Act and the exemptions contained in the first schedule, the following instruments shall be chargeable with duty of the amount indicated in that schedule as the proper duty therefor respectively, that is to say (a) every instrument mentioned in that schedule which, not having been previously executed by any person, is executed in British India on or after the first day of July, 1899. Turning to the schedule, Article 43 is in these terms: Note or Memorandum sent by a Broker or Agent to his principal intimating the purchase or sale on account of such principal (a) of any goods exceeding in value twenty rupees; Stamp duty two annas.