( 1 ) THIS is a reference made to this Court under Section 6l of the Indian Stamp Act by the Chief inspector of Stamps.

( 2 ) THE question is whether a certain promissory-note is chargeable to stamp duty as a bond, The promissory-note reads thus :

"on demand I promise to pay at Gonda to the Court of Wards, Utraula, Bilaspur Estate, district gonda, the sum of Rs. 1,50,000 with interest at 3 per cent. per annum for value received by me on 5-7-5l. "

This document, which was duly stamped, as a promissory-note, was signed by the executant and bears the signatures of two witnesses.

( 3 ) A bond is defined in Section 2 (5) of the Stamp Act as including

"any instrument attested by a witness and not payable to order or bearer, whereby a person obliges himself to pay money to another. "

The promissory-note the subject of this reference is attested by a witness and, not being expressed to be payable to order or bearer, prima facie comes within the ambit of this definition. Explanation (J) to Section 13 of the Negotiable Instruments Act, a section which defines a "negotiable instrument," provides however that a promissory-note which is expressed to be payable to a particular person and does not contain words prohibiting transfer Or indicating an intention that it shall not be transferable is payable to order and the question is whether the effect of this explanation is to exclude the promissory-note from being a bond as defined in the Stamp act. It will, in my opinion, only have that effect it it can be said that the promis sory-note has become an instrument "payable to order;" and I do not think it has.

( 4 ) THE stamp duty on any instrument is to be determined with reference to the terms of the instrument. In Gatty v. Fry, (1877) 2 Ex D 265, the question was whether a post dated cheque payable to bearer and stamped as a bill of exchange payable on demand was admissible in evidence after the date of the cheque. Cleasby, B. , delivering the judgment of the Court said :

"the question therefore is whether, if upon the face of the instrument the stamp is sufficient, as was the case here, since the cheque, at the time of the trial, was payable on demand, it cannot be used in evidence, because, in fact, when it was given, being post dated, it was not then payable. We think this case is concluded by authority, and that in considering whether the stamp is sufficient we must look at the instrument itself alone. The authorities are Williams v. Jarett, (1833) 5-B and Ad 32; Whistler v. Forester, (1863) 14 CB (N. S.) 248; Austin v. Bunyard, (1865) 6 B and Section 687,. . . . . What the Act requires is that a particular instrument which means the paper with certain things written upon it, shall have a particular stamp applicable to that instrument, not to that instrument coupled with other circumstances. "

(1877) 2 Ex D 265 was approved by the Court of appeal in Royal Bank or Scotland v. Tottenham, (1894) 2 QB 715, and the law so laid down has been consistently followed in India : See Ramen Chetty v. Mahomed Ghouse, ILR 16 Cal 432; sakharam Shankar v. Ramchandra Babu, ILR 27 Bom 279; In re C R. M. M. L. A. Chettiar Firm, ilr 13 Rang 613 : (AIR 1935 Rang 243) (SB ).

( 5 ) THE instrument before us is one which by its terms is not payable to order. Exp. (1) of Section 13 (1) of the Negotiable Instruments Act was introduced into the Act by the Negotiable instruments (Amendment) Act, 1919, and its effect was to bring within the class of negotiable instruments certain promissory-notes not payable to order which previously were not negotiable. The fact that a promissory-note which is not expressed to he payable to order is now (provided it does not contain words prohibiting transfer or indicating an intention that it will not be transferable) a negotiable instrument does not, in my opinion, make it an instrument payable to order within the meaning of the Indian Stamp Act. This is a view which has been taken by the Calcutta High Court in Khetra Mohan