The central legal point established in the judgment is the interpretation of promissory notes and their admissibility in evidence, as well as the importance of substance over form in evaluating legal claims.

Sir George Lowndes:-

The suit out of which this appeal arises was instituted by the appellants in the Court of the Senior Subordinate Judge of Peshawar, claiming payment by the respondent, sued both as a firm and individually, of Rs. 27,867-8-0 with further interest until realisation. The foundation of the claim was alleged in the plaint to be a sitta or agreement for sale in the following terms:

That on the 5th of Asuj (a Hindu month) Sambat (Hindu era), 1986, corresponding to 27th September, 1929, the parties entered into an agreement as given in the sitta (agreement to sell) (copy attached) through Sant Amir Chand, broker, as under :

'Sale to R. B. L. Karam Chand Jagat Ram of 200 boxes of tea to be imported from Shanghai. Tea to be sent for by the receiver (of money) himself. Receiver himself to be responsible for profit and loss. Interest at the rate of Rs. 11-4-0 p. a. Time ten months.'

This document in itself, the meaning of which is, to say the least of it, obscure, obviously laid no foundation for the money claimed by the plaintiffs, but it was further alleged that "for the completion of the agreement " the plaintiffs paid to the defendants by cheques on different banks two sums of Rs. 10,000 each on 20th September and 8th October 1929, respectively, and that " the defendants gave other documents by way of memos to the plaintiffs" of which copies were attached to the plaint. The Rs. 27,867-8-0 were said to be the Rs. 20,000 so paid together with interest for the 10 months and at the rate of 11¼ per cent. referred to in the sitta. The other documents referred to were two which appear in the record as plaintiffs' Exs. B and C. They purport to be signed by the respondent firm and (transcribing only the material portions in each case) run as follows :

Received from you this 5th day of Asuj, 1986, Sambat corresponding to 20th September, 1929, a cheque for Rs. 10,000 drawn by you on Messrs. Grindlay and Co., Ltd., Peshawar. The amount would be repaid with interest thereon at the rate of Rs. 11-4-0 p. c. Time ten months. The principal amount will be paid with interest after ten months from this date.

Received from you this 23rd of Asuj, 1986, Sambat corresponding to 8th October, 1929, cheque No. 50284 dated 8th October for Rs. 10,000 drawn on the Imperial Bank of India, Limited, Peshawar. The amount to be paid back with interest at the rate of Rs 11-4-0 p. c. after ten months.

This principal amount with interest thereon to be repaid after ten months from this date.

The respondents put in a written defence pleading inter alia that one of the defendants named was not a partner ; denying that the sitta was a completed contract and denying that any payment was made to them in pursuance of it. They also pleaded that "the documents the copies of which had been produced by the plaintiffs (meaning thereby the sitta and the two documents abstracted above) amounted to pronotes and by reason of their being inadmissible in evidence no suit could be based thereon." This last plea was founded on the fact that none of these documents were stamped and if they were held to be promissory notes, S. 35, Stamp Act precluded their admission in evidence for any purpose. This Act adopted the definition of a promissory note contained in the Negotiable Instruments Act, 1881, S. 4-which runs as follows:

4. A 'promissory note' is an instrument in writing (not being a banknote or a currency note) containing an unconditional undertaking, signed by the maker, to pay a certain sum of money only to or to the order of, a certain person, or to the bearer of the instrument.

The suit went to trial in due course and issues were raised-

1. Did the defendants' firm agree to borrow money from the plaintiffs and executed the sitta dated 20th September, 1929 ? 2. Are the plaintiffs entitled to recover (Rs. 20,000 principal and Rs. 7867-8-0 interest) ? 3. Are the documents annexed to the plaint admissible in evidence ? 4. Is the suit bad for misjoinder of plaintiffs ? 5. Is Abdul