1965 Supreme(Guj) 21
Gujarat High Court
Judgename :P.N.BHAGWATI, M.U.SHAH
JAGJIVANDAS BHIKHABHAI - Appellant
Versus
GUMANBHAI NAROTTAMDAS - Respondent
L.P.A. 21 of 1961
Decided On : 03/25/1965
Headnote:
Negotiable Instruments Act 1881 – Sec. 4 – Indian Stamp Act – Sec. 2 (22) – Bombay Agricultural Debtors Relief Act 1948 – Recovery of Amount – Decree – Letters Patent Appeal is directed against a judgment in Second Appeal confirming a decree passed in appeal by the District Judge Broach dismissing a suit filed by the plaintiff to recover a sum of Rs. 5 100 alleged to have been lent and advanced by the plaintiff to the defendant – Held, Net effect of these words is the same as that of their English equivalent namely I promise to pay to you on demand and if the latter words do not have the effect of restricting negotiability court do not see how the former can have that effect – Court is therefore of the view that Raju J. was not right in taking the view that the words in instrument before him which are almost identical with the words in the instrument before us prohibited transfer or indicated an intention that the instrument shall not be transferable and made the instrument non-negotiable – It is clear that the instrument in the present case was a promissory note within the meaning of sec. 4 of the Negotiable Instruments Act 1881 and therefore within the meaning of sec. 2 (22) of the Indian Stamp Act and being admittedly unstamped it could not be received in evidence – Court cannot therefore admit the instrument in evidence or look at it even as an acknowledgment of liability with a view to saving the plaintiffs claim from the bar of limitation – Appeal Dismissed
( 1 ) THIS Letters Patent Appeal is directed against a judgment given by Raju J. in Second Appeal confirming a decree passed in appeal by the District Judge Broach dismissing a suit filed by the plaintiff to recover a sum of Rs. 5 100 alleged to have been lent and advanced by the plaintiff to the defendant on 21st June 1949. The defendant had also according to the plaintiff executed in favour of the plaintiff an instrument in writing dated 21st June 1949 in respect of this loan but since in the view of the plaintiff the instrument appeared to be a promissory note and on that view the instrument being unstamped would be inadmissible in evidence the plaintiff sued on the original cause of action. The defendant admitted execution of the instrument but his defence was that no moneys were lent and advanced to him against the instrument on 21 June 1949. According to the defendant the instrument though dated 21 June 1949 was actually executed on 14th June 1949 and the circumstances under which it came to be executed were as follows. On 16th January 1948 the defendant had executed a Khata for Rs. 3 0 in favour of the plaintiff and the amount due under that Khata with interest was outstanding on 14th June 1949. The defendant was an agriculturist and the last date for making an application for adjustment of the debts of the defendant under the Bombay Agricultural Debtors Relief Act 1948 was expiring on 15th June 1949. The plaintiff therefore approached the defendant on 14th June 1949 and asked him to square up the existing Khata and to pass a new Khata in favour of the plaintiff bearing date 21 June 1949. The date 21st June 1949 was suggested by the plaintiff because that being a date subsequent to 15th June 1949 the plaintiff expected that if the new Khata was dated 21st June 1949 that would enable him to avoid the consequences of the Bombay Agricultural Debtors Relief Act 1948 Now the amount due under the existing Khata was Rs. 3 0 by way of principal and Rs. 2651by way of interest upto 21 June 1949. The defendant was also in arrears of rent in respect of the lands held by him as a tenant of the plaintiff and those arrears amounted to Rs. 169-9-0. The aggregate amount of indebtedness of the defendant as on 21st June 1949 was therefore Rs. 3 434 The plaintiff lent and advanced a further sum of Rs. 1 665 to the defendant on 14th June 1949 in order to enable the defendant to purchase an engine for better cultivation of the lands and the total amount due and payable by the defendant to the plaintiff thus came to Rs. 5 100 In respect of this indefendant the defendant executed the instrument in question in favour of the plaintiff on 14th June 1949 but the instrument was dated 21st June 1949 at the instance of the plaintiff with a view to getting out of the provisions of the Bombay Agricultural Debtors Relief Act 1948 The defendant on these allegations contended that the transaction having taken place on 14th June 1949 the suit filed on 20th June 1952 was barred by the law of limitation and the plaintiff was not entitled to recover any amount from the defendant. The learned trial Judge accepted the story put forward on behalf of the plaintiff and decreed the suit against the defendant. On appeal by the defendant however the learned District Judge held that the plaintiff had failed to establish that he bad lent and advanced a sum of Rs. 5 100 to the defendant on 21st June 1949 and that the story narrated by the defendant appeared to be more probable namely that the transaction had taken place on 14th June 1949 and that the amount of Rs. 5 100 was made up of the amount due under the previous Khata the arrears of rent and the further amount of Rs. 1 665 lent and advanced by the plaintiff to the defendant on that day as alleged by the defendant. The learned District Judge took the view that though the plaintiffs case was not established a decree could have been passed in favour of the plaintiff on the case of the de