CANEKERATNE J.—Hassan v. 2&vthuwappa.
1947Present: Wijsyewardens and Canekeratne JJ.
HASSAN, Appellant, and MUTHUWAPPA, Respondent.
77 Inty.—D.C. Colombo, 15,916.
Administration—Stamps—Probate or letters of administration—Abrogationof a statutory provision—Stamping not necessary—Stamp Ordinance,No. 22 of 1909, ss. 68 to 73—Estate Duty Ordinance (Cap. 187),s. 52—Civil Procedure Code, s. 547.
The provision relating to the due stamping of a probate or letters ofadministration has been rendered unnecessary by the Estate DutyOrdinance.
A PPEAL from an order of the District Court of Colombo.
S.J. V-. Chelvanayagam (with him A. C. Nadara^dh) for the defendantappellant.
C- Thtagalingam (with him C. Chellappah) for the plaintiff, respondent.
W. R. Weerasooriya, C.C., for the Attorney-General, on notice.
Cur. adv. vult-
Jaruary 29, 1947 Canekeratne J.—
Some years ago the defendant and one Mohamed Sheriff carried on,as partners, the business of a restaurant called the Colombo BuhariHotel. The plaintiff, as the administrator de bonis non of the estate ofMohamed Sheriff, who is said to have died on April 99, 1941, applied to theCourt in this action to wind up the business and affairs of the partnership,for an order on the defendant to render an account and pay the sum founddue on the accounting. After sixteen issues had been framed the plaintiffled evidence and closed his case ; the defendant then raised an issuerelating to the competency of the plaintiff to maintain the action on theground that the letters of administration had not been duly stamped.This is an appeal from the decision of the trial Judge refusing to proceedwith the action until the inventory has been amended by the plaintiff.
It appears that a grant of administration in respect of the estate of thedeceased was originally made to one Mohamed Cassim and he included inthe inventory a half share of the business called the Colombo BuhariHotel,. the value of which he estimated at Rs. 768.12. • The contentionof the defendant, below and in this Court, as stated by his Counsel, hasbeen that the duty paid by the administrator was in fact insufficient tocover the property claimed in this action, inasmuch as the relief claimedis estimated by the plaintiff at Rs. 40,000, not at Rs. 768.12, and that theletters of administration were not duly stamped and the plaintiff wastherefore debarred by the provisions of section 547 of the Civil ProcedureCode (Ch. 86 of the Legislative Enactments of Ceylon) from maintainingthis action. Counsel for the appellant contended that the provisions ofthe section were no bar to the maintenance of the actjon. As the questionin dispute was one of importance to the public the Court expressed adesire to hear the views of the Attorney-General-; Crown Counsel appeared
CANSKERATNE J.—Hasson v. Muthuwappa.
on behalf of the Attorney-General at the adjourned hearing and advancedthp view that the regulation prescribing due stamping of the instrumentcannot now be applied and that it has been repealed.
One who desires to obtain a grant of representation to the estate of adeceased person has a right to make an application to the District Courtwhich has territorial jurisdiction over the place where the intestate died.On the relevant facts being proved—such as the death of the intestatethe leaving of property by him, the right of the applicant to make theapplication, &c.—the Court would, as a general rule, make an order inhis favour. The Legislature may qualify this general right' by imposingconditions : one such condition was imposed by the Stamp Ordinance of1871 for the purpose of obtaining the proper and full duty exigible onthe property and estate of the deceased in Ceylon: a Court was debarredfrom making a grant of letters of administration until it obtained anaffidavit from the applicant or some other competent person that theproperty and estate of the intestate are of the value of a certain sum to betherein specified to the best of the deponent’s knowledge, information andbelief (section 29 of Ordinance No. 23 of 1871).
The Code of Civil Procedure was passed in 1889 and the StampOrdinance which was then in force was Ordinance No. 23 of 1871. TheCode of Civil Procedure came into operation on August 1, 1890, but beforethat date the Legislature enacted a new Stamp Ordinance, OrdinanceNo. 3 of 1890, which also came into operation on August 1, 1890.Sections 24 to 30 of that Ordinance deal with probates and letters ofadministration. While these sections substantially repeat the languageused in sections 29 to 35 of the repealed Ordinance, the Legislature madeone important alteration ; the power of cancelling the stamps representingthe amount of duty was taken away from the District Court issuing thegrant. Section 29 provides that the Judge shall transmit ^the amount ofthe stamp duty paid into Court by the applicant to the Commissioner ofStamps, together with the letters of administration, who shall cause theinstrument to be duly stamped and return it to the Judge. In 1909 theLegislature substituted Ordinance No. 22 of 1909 in place of the StampOrdinance of 1890. The provisions relating to testamentary duties arefound in Ch. 7 of this Ordinance which consists of sections 68 to 73.Section 68 contains provisions similar to those of section 24 of the earlierOrdinance ; it shows that probate or letters of administration will notbe granted except on an affidavit of property setting out the approximatevalue of the estate. Sections 69 and 70 contemplate the possibility ofoverpayment and underpayment of probate duty on that affidavit andits proper adjustment (these sections correspond to sections 25 and 26 ofthe Ordinance of 1890 and sections 30 and 31 of the Ordinance of 1871) ;underpayment is made an offence as regards an executor or administratorunder certain circumstances (section 73 of the Ordinance of 1909 whichcorresponds to section 29 of the Ordinance of 1890 and section 34 of theOrdinance of 1871).
Estate duty was introduced by Ordinance No.'8 of 1919 ; it was to becalculated at the proper rate on the value of the estate as set forth in the.statement delivered by the executor if the Commissioner of Stamps wassatisfied with it—otherwise on the estimate made by an assessor (section.
CANEKERATNE J.—Bassen v. Mtithuwappa.
22 (1) ). The duty is then assessed ; on payment of the duty or on.proper security for its payment having been given the Commissioner ofStamps issues a certificate ; sub-section 4 of section 23 provides that noprobate or letters of administration are to be issued by a District Courtunless and until such certificate has been filed. The Ordinance repealedsections 68 to 73 of the Stamp Ordinance of 1909 and the portion referringto duty on probate and letters of administration as contained in part 3of Schedule B of the Ordinance. Ordinance No. 8 of 1919 was repealedin 1935 (Ordinance No. 51 of 1935).
The present Ordinance relating to estate duty is Ordinance No. 1 of1938 (Ch. 187 of the Legislative Enactments). It provides that theexecutor of every deceased person shall deliver to the Commissioner ofEstate Duty a declaration of property containing a full and true state-ment of particulars relating to the total estate of the deceased includingthe value thereof (section 29, sub-section 1). An assessor may at anytime, whether the declaration has been delivered or not, assess the estateduty payable and shall issue to the person or persons whom he considersliable to pay such duty a notice of assessment (section 32) : the dutybecomes due on the date specified in the notice (section 44 (1) ) ; poweris given to the Commissioner to allow the duty to be paid by .sixteen half-yearly instalments in certain cases (section 48 (1) ), the person liable topay must furnish security to the satisfaction of the Commissioner (sub-section 2). The Commissioner issues a certificate of payment to theexecutor when he has paid or secured to his satisfaction the payment ofall estate duty for which he is liable (section 49). Section 52 providesthat no probate or letters of administration shall be granted by theCourt until the Commissioner has issued the certificate above named andthe certificate has been filed in Court.
Probate duty (the same provision applies to the duty payable onletters of administration) was a stamp tax payable on the value of theestate of a deceased by means of a stamp on the affidavit of value whichevery person applying for a grant of representation to the estate of adeceased person was required to make as to the particulars and value ofthe estate of the deceased to whose estate he sought representation, andno grant of representation could be made by a Court till the affidavithas been received. After the amount payable as probate duty has beenassessed the legal representative pays it into Court and the Court sendsit together with the probate (or letters) to the Commissioner of Stamps.The Commissioner causes stamps of the proper value to be affixed to theinstrument and cancelled (see section 3 (10) of the Stamp Ordinanceof 1909).
Section 547 of the Civil Procedure Code states thus :—“No actionshall be maintainable for the recovery of any property ….belonging to or included in the estate or effects of any person dyingtestate or intestate …. where such estate or effects amount to orexceed in value the sum of Rs. 1,000 unless grant of probate or letters ofadministration duly stamped shall first have been issued to some personor persons as executor or administrator of such testator or intestate”.The sum of Rs. 2,500 was substituted later for the sum of Rs. 1,000.
Wijesinghe v. The Attorney-General.
Estate duty is, according to the Ceylon Ordinance, a first charge on allthe property of the deceased (section 26 (1) ) ; it is a sum payable by theperson accountable, be he executor (part (a) of sub-section 4) or personother than the executor (part (b) ). It does not seem to be a stamp duty.It was stated in the course of the argument by Counsel for the appellant(and the form of the probate and letters issued in cases which have comebefore this Court shows that this is correctly stated) that no stamp is nowaffixed to the probate or letters. There is no provision now for affixingstamps on the instrument; an applicant for probate or letters now paysdirectly the amount assessed as estate duty to the Commissioner bytendering money, or perhaps a cheque, and the Commissioner issues acertificate; the Court grants probate or letters after the certificate hasbeen filed in Court.
The provision relating to the due stamping of the probate (or letters) wascomplementary to the provisions of the Stamp Ordinance ; that Ordinancerequired a tax to be paid in a particular way. So long as there was inexistence a statutory enactment providing for the affixing of stamps on aprobate (or letters) and for the instrument being duly stamped, therewould be no difficulty in construing the expression “ duly stamped ”used in section 547. Since 1919 no provisions relating to the affixing orcancellation of stamps are to be found in any statutory enactment; allthe reasons which imposed an obligation on the applicant to tender theamount of probate duty to the Court and a duty on the Commissioner ofStamps to cause the proper stamps to be affixed and cancelled havewholly ceased to operate. Reason is the soul of the Law and when thereason of any particular law ceases, so does the law itself (see Broom’sLegal Maxims, 10th edition, page 110). Legislation has thus renderedunnecessary the provisions relating to the due stamping of a probate orletters of administration. It would be impossible to apply such a provi-sion to an instrument on which no stamps are affixed granted since thecoming into operation of the Estate Duty Ordinance without doingconsiderable violence to the language used.
The order of the trial Judge is set aside ; the respondent will pay thecosts of the hearing in the District Court and the costs of appeal to the
Wijeyewabdene J.—I agree.
Order set aside.
HASSAN, Appellant, and MUTHUWAPPA, Respondent