HAJI MOHD RAJAB GUJRI Vs. LAL MOHD BANGRU

JUDGEMENT

(1.) IN this suit an objection has been taken by the defendants that the promissory note and the receipt are not duly stamped & therefore are inadmissible: in evidence. It is submitted that according to Section 2 of the Indian Stamp Act an instrument would be deemed to have been duly stamped when the same bears an adhesive or impressed stamp of not less than the proper amount and that such stamp has been affixed or used in accordance with the law for the time being in force in India. Attention is invited to entry 91 of List I to Seventh Schedule of the Cons ­titution of India which is applicable to the State of Jammu and Kashmir. According to this entry rates of stamps duty in respect of bill of exchange, cheques, promissory notes, bills of credit etc, and receipt are to be determined by the Union Legislature. It is submitted that rate of stamp duty chargeable on an instrument includes within its ambit description at well, as the description is an ancillary matter and the rate being the principal matter. Ancillary matters to the principal are within the competence of parliament to legislate. In the instanct case as the promissory note and the receipt do not bear the requisite description, there ­fore the two instruments i.e. the promissory note and the receipt being not duly stamped cannot be admitted in evidence.

(2.) THIS argument is, however, misconceived and is based on wrong assumption that the rate and description are an anonymous. It is true that according to entry 91 of the Union List the rate chargeable on stamps mentioned in the entry must in the State be the same as it obtains elsewhere in India and Parliament alone is competent to make law in this behalf. There is, however, no dispute with regard to the proposition that the two instruments before us do not bear the requisite rate of stamp duty as provided by law and so far as this aspect of the matter is concerned there is no quarrel over that but what is assumed is that these instruments should bear the same description of stamps as provided by the Indian Stamp Act. In other words the argument is that it would be the Union Stamps and not the State stamps which are required to be used for bills of exchange cheques, promissory notes, bills of leading, letters of credit, policies of insurance, transfer of shares, debentures, proxies and receipts.

(3.) IN my opinion description is not an ancillary matter to the ques ­tion relating to the rate of stamp duty. The two expressions in the stamp Act have been used by the legislature distinctly and they bear different connotations. In Entry No. 91 the Constitution makers have used the word rate and not the description of the stamps. The Indian Stamp Act does not apply to the State of Jammu and Kashmir vide Section 1 of the Indian Stamp Act. We have got our own State Act. The description of the stamps relating to the various instruments is given in the Jammu and Kashmir Stamp Act. It is that Act which is applicable to all instruments for the purpose of description of stamps. In view of this the promissory note and the receipt cannot be said to be not bearing correct description of stamps and therefore cannot be said to be not duly stamped. The objection is, therefore, over -ruled, and the case will now come up for recording of the evidence of the plaintiffs witnesses. Let the witnesses of the plaintiff be summoned. The case to come up on 6th of April, 1972.