SENANAYAKE MOHOTTI AND OTHERS

SENANAYAKE MOHOTTI AND OTHERS

VS.

ARUNA SHANTHA AND ANOTHER

SUPREME COURT
S.E. WANASUNDERA P.C, J.
ANIL GOONERATNE J.
NALIN PERERAJ.
SC APPEAL 125/2015 SC/HCCA/LA/24/2013 (LA)
WP/HCCA/GAMP/44/2013
D.C. ATTANAGALLA CASE NO. 1253/M
04.07.2017.

Financial lease agreement - Guarantors - Stamp Ordinance - Hire purchase -Motor vehicles - Motor coaches and lorries - Exemption - Natural meaning -Personal activity - Section 33 Stamps Ordinance.

Finance lease agreement entered between Plaintiff - Petitioner -Respondent, Bank, and 1st Defendant- Respondent. The 2nd and 3rd Defendants were guarantors. Action filed in the District Court of Attanagalla. 1st and 3rd Defendant - Respondents did not appear, case fixed exparte against them. 1st Defendant failed to pay the regular payment due to the Bank, and the Bank filed action to recover the amounts due.

When evidence of Plaintiff was led the 2nd Defendant - Respondent objected to the Finance Lease agreement being marked (A) in evidence on the basis that it is not properly stamped. Learned District Judge upheld the objections and refused it to be permitted to be marked and produced in evidence. On appeal to the High Court Plaintiff succeeded in appeal. 2nd Defendant-Respondent-Appellant appealed to the Supreme Court.

HELD:

1. The simple reading of the gazette appears to state that Finance Leases on vehicles used for travelling would be liable for stamp duty. I would add that" liable " would mean answerable, or exposed or subject or likely. As such can one state stamp duty would not be chargeable for finance leases on all vehicles but merely for those used for travelling. The simplest of the definition for travelling would be conveyance. Vehicles are used for travelling and not usually for any other purpose. There are no vehicles that are not used for travelling, but may be connected to some other purpose. The English words travelling does not exactly mean the word

JULY 27,2017

ANIL GOONERATNE J.

This was an action on a Finance Lease Agreement entered between the Plaintiff-Petitioner-Respondent Bank and the 1st Defendant-Respondent. The 2nd and 3rd Defendants were the guarantors to the above agreement and action was filed in the District Court of Attanagalla. 1st and 3rd Defendant-Respondents did not appear in court and the case was fixed ex-parte against them. The 1st Defendant failed and neglected to pay the regular payment due to the Bank and Plaintiff-Petitioner-Respondent Bank filed action to recover a sum of Rs.1,578,204/30 and interest thereupon at 36% p.a from 18.12.2008.

It is said that the evidence of the Plaintiff witness was led by the Plaintiff Bank and said Finance Lease Agreement, annexed to the plaint marked "A" was sought to be marked in court and the counsel for the 2nd Defendant- Respondent objected for same being marked in evidence on the basis that the said agreement has not been stamped. The learned District Judge by his order of 3.10.2013 upheld the objection of the 2nd Defendant and refused to mark and permit to produce the said lease agreement in evidence. On appeal by the Plaintiff-Respondent to the relevant High Court, the Plaintiff succeeded and the appeal was allowed. The 2nd Defendant-Appellant appealed to the Supreme Court and leave was granted on 21.07.2015 on questions of law referred to in paragraphs 7(a) to (d) of the petition filed of record. The said question read thus:

(a) Has their Lordships erred in failing to appreciate that upon the plain reading of the words in Gazette Extraordinary Notification. No. 1465/ 20 Item No.15 in the schedule to the gazette, exempts all Hire Purchase Agreements from stamp duty, except Agreements in relation to vehicles used for travelling;

(b) Has their Lordships erred in failing to appreciate that term "Private" being excluded from the latter Gazette Notification No. 1465/20 has been done to include all hire purchase agreements wit

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