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Present: Lascelles CJ. and Middleton j.
K1STNAPPA CHETTY v. SILVA et al241—D. C. Colombo, 31,377.
Cancellation of stamp—Promissory note—Antedating stamp—Ordinance
No: 22 of 1909, s. 9.
A promissory note was made on January 4, 1909, and the stampwas affixed and was cancelled on that date by the maker, but incancelling tho note he put the date of January 1, 1910, instead ofJanuary'4, 1910.
Held, that the stamp was sufficiently cancelled.
Lascelles C.J.—The language of section 9 of tho Stamp Ordi-nance of 1909 leaves no doubt that sub-section (3) is optional andnot imperative.
l^pHE facts appear from the judgment.
Walter Pereira, K.C. (with Him Sandrasagra), for the appellants.—The method of cancelling a stamp is indicated by section 9,sub-section (3), of Ordinance No. 22 of 1909. The person cancelling
1 (1892) 2 0. L. R. 59 ; 1 8. C. R. .247.
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has to write “ the true date of his so writing.” The word “ may ”in sub-section (3) cannot be interpreted to mean that the provisionsof that sub-section need not be complied with in every case. Theobject of the section is to protect the revenue ; if any date couldbe written on the stamp, the revenue would not be protected. Itwould be highly dangerous to hold that a maker of a note couldantedate the cancellation of a note.
Sampayo, K.C., for the plaintiff, respondent.—Sub-section (3)gives only one of the modes of cancellation of a stamp by way of anillustration ; it does not say that it is the only mode of cancellation.The object of cancelling a stamp is to prevent its being used again.Whether a person puts the actual date of cancellation or any otherdate the object is attained. Postdating may not be a sufficientmode of cancellation, for the stamp may be used again ; butantedating prevents the stamp from being used again. The corre-sponding section of the Indian law is section 12 of the Indian StampAct of 1899. Sub-section (3) of the Indian Act has the additionalwords “ or in any other effectual manner.” But it was held inIndia in Virbhadarapa v. Bhimajix that these words did not effectany change in the law of India ; and that the words were added inthe ne' Stamp Act of India to make the law clearer. The methodof cancellation indicated in sub-section (3) is not obligatory; it isonly intended as a guide. Virbhadarapa v. Bhimaji.1
Counsel cited Pitche Carmen Asary v. Asary ;* Moorgappa Ckettyv. Silva ;3 Bhawanji Harbhum v. Doji ;4 Alpe's Law oj Stamp Duties,p. 22 ; Donogh’s Indian Stamp Law, pp. 12 and 117.
Aug. 23, 1911
Walter Pereira, K.C., in reply.
Cur. adv. vult.
August 23, 1911. Lascelles C.J.—
This is an action on a primissory note, to which the defendants,who are the executors of the maker, pleaded that the note was aforgery ; and also that it was inadmissible in evidence, on the groundthat it had not been duly stamped within the meaning of section 9of the Stamp Ordinance of 1909. The only ground of appeal nowtaken is that which relates to the stamping of the promissory note.It appears that the note was made on January 3 or 4, and that thestamp was affixed and was cancelled on that date by the maker, butthat in cancelling the note he put the date January 1 instead of the3rd or the- 4th of that month. The explanation given is that thenote in question was a renewal of a note which had expired onJanuary 1, and that the maker affixed that date on the note withsome idea of preserving the continuity of the transaction. Howeverthat may be, the question arises whether the note has been dulycancelled in the manner provided by section 9. Now, in order to
■' Wendt's Rep. 351.
1 (1894) 19 Bam. 035 at page 638.
' 23 Bom. 432.
* (1882) Wendt’s Rep. 41.
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Aug. 23,1911 ascertain the meaning of the section, it is necessary to regard itLasceli.jss as a Whole. The section is divided into three sub-sections : the firstC Ji sub-section deals with the cases (a) and (b), namely, the case whereKutnappa a person affixes a stamp to an instrument which has already beenC,$iiva executed, and the case of a person who executes an instrument. Inboth these cases it is required that the stamp shall be cancelled sothat it cannot be used again. No particular method of cancellingthe stamp is prescribed ; the only essential is that it shall be socancelled that the stamp cannot be used again.
Sub-section (2) deals with the case of an instrument that has notbeen cancelled so that it cannot be used again. Such an instrument,so far as the stamp is concerned, is deemed to me to be unstamped,and therefore is inadmissible in evidence.
Then we come to sub-section (3), which slates that the personrequired to cancel a stamp may cancel it in a certain way. He maywrite his name in ink on or across the stamp, or the name or initialsof his firm, with the true date of his so writing so as effectually toobliterate and cancel the stamp, or so as hot to admit of the stampbeing used again.
The language of the section leaves no doubt that sub-section (3) isoptional and not imperative. The object of the sub-section is toindicate a method of cancelling the stamps, which will be acceptedas sufficient. It is a method which all prudent persons would.adopt,but there is nothing in the section which makes it obligatory onpersons to cancel the stamps on an instrument in that particular way.What the section does insist on is that the stamps shall .be so cancelledas not to be capable of being used again. In the present case itis obvious that the stamps on the promissory note have not beencancelled in the way indicated by sub-section (3), inasmuch as themaker did not insert on the stamp the true date of the cancellation.But the question remains as to whether there has been compliancewith the earlier portions of the section, which require stamps to beso cancelled as not to be capable of being used again. Now, theonly argument addressed to us on that point by the learned Solicitor-General is that it would be highly dangerous to admit that a stampon which the cancellation was antedated could be held to be properlycancelled, and we were invited, as I understand, to rule that an ante-dated stamp can in no case be held to have been properly cancelled.Now, I should hesitate in laying down a general rule of this natureunless some authorities had been cited in support of the proposition ;and considering that the Indian Stamp Ordinance is practically thesame as our present Ordinance, I should have expected some Indianauthority if the proposition had been sound law. But I think it■ would be going too far to attempt to lay down any general rule onthis subject. There is a vast difference between a stamp antedatedby only two or three days as in the present case, and a stamp ante-dated by a longer period. In the one case the grounds of suspicion,
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if they exist at all, are extremely small; in the other ease they maybe very substantial. In dealing with the particular case before us,I see no reason for holding that the stamp has not been properlycancelled. The only defect alleged is the fact that the cancellationhas been antedated by either two or three days. In the absence ofany further grounds of suspicion, I am not prepared to hold that thestamp has been improperly or insufficiently cancelled. It seems tome that it has been so cancelled as to prevent its being used again.I think the judgment of the District Judge is correct, and I wouldconfirm it with costs.
I agree. The question here is whether the document before usbore a stamp which was duly cancelled. The stamp on it wasv cancelled in fact, inasmuch as it bore upon it the name of the personresponsible on the promissory note and a date, though that date issome two days before the document was executed. Under section 9,sub-section (3), it seems to me that the mode of cancellation therelaid down is an optional one, and that the object of the section isthat the stamp should be obliterated and cancelled so as not toadmit of its being used again. Here, although the date of cancellationwas ex facie previous to the actual date of the instrument, in myopinion it was cancelled, and it was sufficient within the terms ofthe section. As regards the danger alluded to by the learnedSolicitor-General, it does hot appear to me more imminent thanwould be a user of old dated stamps on documents falsely dated toappear old. In reality such things have been known to occur inthis Court, and it is possible that fraud may occur in regard to sucha cancellation as is objected to here. Any discrepancy between thedate of the cancellation of the stamp and the date of the documentshould, I think, always put the Court on an inquiry. The questionwhether a document has been duly stamped, as regards the can-cellation of the stamp, is a question of fact dependent on proof oradmission of circumstances attendant upon it. The Court, if put onan inquiry, would be able to ascertain whether or not fraud had beenintroduced. I think the appeal should be dismissed with costs.
KISTNAPPA CHETTY v. SILVA et al