The admissibility of under-stamped promissory notes as corroborative evidence and the use of oral evidence for loan agreements even when contemporaneous with an inadmissible promissory note.

1. This is a defendant's appeal arising out of a suit to recover Rs. 2,016-12-9. Conceding that an under-stamped promissory note executed by the defendant was invalid for the purpose of creating an obligation, the plaintiff founded his claim on the averment of money had and received by the defendant and sought to substantiate his plea by oral evidence to prove that the sum of Rs. 1,200 was received by the defendant on 1st August 1928, by way of loan repayable with interest at 2 per cent per mensem. Both the Courts below concurrently found that the defendant received the sum of Rs. 1,200 as a loan and awarded, interest at the rate of 2 per cent per mensem on proof of an oral agreement in that behalf. In reaching that conclusion however they took into consideration the understamped promissory note as a piece of evidence containing an admission of the receipt of Rupees 1.200 alleged to have been advanced to him as a loan.

2. It is contended on behalf of the appellant that the concurrent findings of the Courts below are in point of law vitiated for reasons mentioned below: (1) that the promissory note being insufficiently stamped was under S. 35, Stamp Act, inadmissible for any purpose, (2) that when the terms of the contract of loan were embodied in the promissory note which was inadmissible in evidence on account of its being defectively stamped, no oral evidence in proof of the transaction of loan was admissible, and (3) that in any case the agreement to pay interest at the rate of Rs. 2 per cent per mensem could not be proved by oral evidence. As to point No. 1 reliance is placed on 21 Bom 201 Mulji Lala v. Lingo Makaji,1897 21 ILR(Bom) 201, in which it was held that an acknowledgment of a debt coming under Art. 1, Sch. 1, Stamp Act of 1879, could not, if unstamped, be given in evidence for any purpose including the purpose of saving limitation. S. 35, which forbids the admission into evidence of any instrument not duly stamped runs as follows:

No instrument chargeable with duty shall be admitted in evidence for any purpose by any person having by law or consent of parties authority to receive evidence, or shall be acted upon, registered or authenticated by any such person or by any public officer, unless such instrument is duly stamped.

3. It must be borne in mini that the word used is 'instrument' and not document' : 'Instrument' includes every document by which any right or liability is or purports to be created, transferred, limited, extended, extinguished or recorded. Instrument therefore is a document which affects any right or liability. The promissory note cannot in view of the terms of S. 35 be admitted in evidence as an ''instrument'' for any purpose affecting any right or liability. In the cited Bombay case the unstamped document which purported to be an acknowledgment under Art. 1, Sch. 1, Stamp Act, was rightly held not admissible for purposes of limitation, namely.for the purpose of affecting the plaintiff's right to sue within the period prescribed by the law of limitation. Enforceability of an instrument is a different thing from admissibility of a document. If an instrument contains the record of a certain fact which per se does not affect any right or liability the instrument cannot be said to be admitted in evidence when the document is used solely for the purpose of proving any neutral fact it contains.

4. In 46 Mad 948 Chandick v. Ananta Lal Damani, 1924 AIR(Mad) 352 an unstamped acknowledgment was admitted in evidence on the ground that the writing contained in the document was not intended to supply evidence of debt but with the intention that it was to be a mere statement of accounts as between the parties. That writing was held not to amount to an acknowledgment as affecting any right or liability but only as a record of the state of mutual accounts. In the present case the Courts below did not use the document as ''an acknowledgment'' but as corroborative evidence of ''the fact'' of payment of Rs.