1. This appeal arises out of a suit filed by the plaintiff on a promissory note. The promissory note was executed by defendants 1 and 2 and the trial Court admitted the promissory note as against defendant 1, passed a decree in favour or the plaintiff against defendant 1, and dismissed the suit against defendant 2. The plaintiff has now come in appeal.

2. The promissory note bears the signature of both the defendants, taut it is admitted by the plaintiff that when defendants 1 and 2 signed the promissory note it did not bear the requisite stamps and the requisite stamps were affixed subsequently and they were cancelled by defendant 1. On this admitted position the question arises whether in law this promissory note is admissible in evidence as against defendant 2.

When we look at the scheme of the Stamp Act, it is clear that the Stamp Act does not contemplate the execution of an unstamped document in India when the document is chargeable to duty and as we shall presently point out, the Stamp Act requires every document which is chargeable to duty and which is executed in India to be executed after it is duly stamped and the consequence of a document being executed which is not duly stamped, if it is a promissory note, is that under Section 35 it becomes inadmissible in evidence.

Section 11, Stamp Act refers to documents which may be stamped with adhesive stamps and the promissory note fails under Clause (a) of Section 11. Section 12 (1)(a) refers to documents which have been already executed without the necessary stamps being affixed thereon and the fixing takes place subsequently and also the cancellation. Obviously, this sub-section deals with those documents which fall under Sections 18 and 19 and which can be executed without being stamped, the execution of the document taking place outside India.

Section 12 (1)(b) deals with cases of documents executed in India. Section 17 provides that all instruments chargeable with duty and executed by any person in India shall be stamped before or at the time of execution. Clause (b) of Section 12 (1) provides:

"Whoever executes any instrument on any paper bearing an adhesive stamp shall, at the time of execution, unless such stamp has been already cancelled in the manner aforesaid, cancel the same so that it cannot be used again".

Therefore, Clause (b) clearly contemplates the execution of an instrument on a paper which already bears a stamp and it casts an obligation upon the executant to cancel the stamp so that it cannot be used again. Sub-section (2) of Section 12 provides:

"Any instrument bearing an adhesive stamp which has not been cancelled so that it cannot be used again, shall, so far as such stamp is concerned, be deemed to be unstamped".

An interesting argument was advanced before us whether on the facts of this case it could be said that the document was duly cancelled, but in our opinion it is unnecessary to consider that aspect of the case. It is possible to dispose of this appeal on a much narrower point.

3. Turning again to Section 17, it provides that the stamping of an instrument chargeable with duty and which has been executed in India must be before or at the time of execution. Therefore, if a document is executed which is not stamped either before or at time of execution, It would not be duly stamped for the purpose of the Stamp Act and would be inadmissible in evidence by reason of Section 35.

The question that we have to consider is whether with regard to the promissory note before us it could be said that it was stamped before or at the time of execution. The evidence is clear, and that is the evidence of the plaintiffs husband. He says that defendant 1 wrote out the promissory note in suit and defendants 1 and 2 put their signatures on it in his presence. That completes the execution of the promissory note which was not stamped. Then it was stamped and defendant 1 signed the promissory note on the stamps in his presence.

Therefore, this is clear eviden