JAGAT NARAYAN, J. - (1.) THESE three revision applications have been filed by the defendants in three suits for the recovery of money. They have been referred to a Division Bench on account of the importance of the question involved in them, namely whether a particular document is a promissory note within the meaning of Section 2(22) of the Stamp Act which runs - 'Promissory Note' means a promissory note as defined by the Negotiable Instruments Act, 1881; it also includes a note promising the payment of any sum of money out of any particular fund which may or may not be available, or upon any condition or contingency which may or may not be performed or happen: In Section 4 of the Negotiable Instruments Act 'promissory note' is defined as follows - A 'promissory note' is an instrument in writing (not being a bank note or a currency note) containing an unconditional undertaking, signed by the maker, to pay a certain sum of money only to, or to the order of, a certain person, or to the bearer of the instrument. The definition is followed by a number of illustrations out of which three may be reproduced here - (a) 'I promise to pay B or order Rs. 500/ -.' (b) 'I acknowledge myself to be indebted to B in Rs. 1,000/ - to be paid on demand, for value received.' (c) 'Mr. B. I. O. U. Rs. 1,000/ -.' The instruments in (a) and (b) are promissory notes. The instrument in (c) is not a promissory note.
(2.) DOCUMENTS falling within the extended definition given under the Stamp Act are rarely met with in actual practice. The reported cases also deal with only such documents as come under the definition of promissory note as given in Section 4 of the Negotiable Instruments Act. Our observations in this ease will also be confined to such documents. It will be seen that in order that a document may fall within the definition of 'promissory note' contained in the Negotiable Instruments Act, it is necessary that there should be - (i) an unconditional undertaking to pay, (ii) the sum should be a sum of money and should be certain, (iii) the payment should be to or to the order of a person who is certain, or to the bearer of the instrument, and (iv) the maker should sign it. (2A) Under the Stamp Act distinct duties are prescribed for different classes of documents but the the definitions of these documents have been so widely worded that in actual practice one document may fall within more than one category. Ordinarily it is not of great importance under what category a document falls as most documents can be accepted in evidence on payment of deficit duty and penalty even if they are not properly stamped. But a promissory note which is not properly stamped cannot be tendered in evidence on payment of deficit duty and penalty in view of the provisions of section 35 of the Stamp Act. The result is that unless the plaintiff can 'fall back upon the original transaction, the money which he would otherwise have been able to recover becomes irrecoverable. Courts are often called upon to determine whether or not a document is a promissory note and some tests have been laid down in decided cases. In Mulla's Commentary on the Stamp Act, 1941 Edition, the law which evolves as a result of these decisions has been stated thus at page 35 - But besides fulfilling the terms of the definition, the instrument must pass three further tests - (1) the promise to pay must fee the substance of the instrument, (2) there must be nothing else inconsistent with the character of the instrument as substanfially a promise to pay, and (3) the instrument must be intended by the parties to be a promissory note. The above statement of law is borne out by English and Indian authorities.
(3.) IN Ellis v. Ellis, 1820 COW 216 the document ran - I, Robert Ellis, Jun, do this day Bargain and agree with my uncle, William Ellis, to give him 5 for a cart for the use of my father, and do hereby promise and agree to pay him the said William Ellis, without fail in three weeks from the date hereof. Robert Ellis Jun. Richardson J. held 'I think the instrument in question is an agreement. If it were to be held a promissory note only, every written memorandum for the purchase of goods, 'where payment is stipulated to be made at a future day, would be a promissory note.' ;