JUDGMENT
P.K. Shamauddin, J.
1. The legal representatives of the plaintiff in O.S. No, 5 of 1974 on the file of the Court of Subordinate Judge of Kozhi-kode are the appellants in the second appeal.
2. The suit was filed for recovery of an amount of Rs. 7,993.35 on the basis of a document which is described as voucher in the plaint as amended. The defendant in the written statement contended that he had not borrowed any amount. He also claimed the benefit under Act 1 of 1977 and Ordinance 9 of 1977. The learned Subordinate Judge found that the money was borrowed and that he was not entitled to the benefits of Act 1 of 1977 and Ordinance 9 of 1977. He further held that the suit document is not a voucher but a promissory note, that one of the stamps was not cancelled and that therefore the document is inadmissible in evidence. However, the trial Court took the view that the debt was an anterior debt and that the plaintiff was entitled to fall back on the original cause of action and in this view of the matter, the suit was decreed as prayed for,
3. On appeal, the learned District Judge held that the plaintiff was not entitled to fall back upon the original consideration and the suit was dismissed. The learned District Judge relied on the observation contained in the order of this Court in C.R.P. No. 3813 of 1977. In the original plaint, the plaintiff described the document as promissory note. He filed a petition seeking to amend the plaint to substitute the word voucher for promissory note. That application was dismissed by the trial Court, but in C.R.P. No. 3813 of 1977, this Court allowed the application for amendment.
4. In this second appeal, the learned counsel for the appellants raised several contentions. He submitted that the finding of the lower appellate Court that the plaintiff cannot fall back upon the original consideration is not correct. He contended that Ext. A-l would indicate that the debt is an anterior debt and is independent of the promissory note executed as a collateral security and in the circumstances, the trial Court was right in holding that the plaintiff is entitled to fall back on the original consideration. He also contended that Ext. A-l promissory note was admitted in evidence and in view of the specific provision contained in Section 35 of the Kerala Stamp Act, which corresponds to Section 36 of the Indian Stamp Act, it is not open to the Court to consider the question of admissibility of the document.
5. There cannot be any doubt that if the transaction of loan is anterior to and independent of the execution of the promissory note, the creditor is entitled to fall back on the origional consideration in the event of the promissory note being found inadmissible in evidence for the reason that promissory note is not stamped or insufficiently stamped or that there is failure to cancel stamps. This question was considered by a Division Bench of this Court in Saffia Khathoon v. Kun-hambu, 1977 Ker LT 448. This Court said :
“It is clear that the promissory note had been executed by 1st defendant only in acknowledgment of the loan that had already been advanced to him by the plaintiff, thereby making it clear that the transaction of loan was anterior to and independent of the execution of the promissory note. The legal position is well established that in such circumstances the creditor is entitled to maintain a suit for recovery of the debt based on the original contract of loan in case the promissory note is found to be defective in any respect.”
6. However, in the instant case, there is nothing to show that the loan transaction was anterior to and independent of the execution of the promissory note. A reading of the plaint would clearly show that the suit is based on promissory note and not on the original consideration or on a transaction anterior to or independent of the execution of the promissory note. As indicated above, finding that one of the stamps was not cancelled, and that the promissory note would be inadmissible in evidence, the plaintiff sought to amend the plaint by substituting a word ‘voucher’ for ‘promissory note’ wherever the expression occurred in I.A. No. 5886 of 1977. That application was dismissed and the plaintiff filed C.R.P. No. 3813/77. In the course of the order in C.R.P. No. 3813/77, this Court pointed out that the amendment sought was only for substitution of the word Voucher’ for the word ‘promissory note’ and did not seek to change the character of the suit and that therefore there was no justification for dismissal of the application and that the plaintiff cannot fall back on the consideration. In view of the observation contained in the order of this Court in C.R.P. No. 38I3/ 77, it is not open for the plaintiff to fall back upon the original consideration. Both the Courts below found that Ext. A-l is hot a voucher, but it satisfied all the requirements of the promissory note and therefore Ext. A-l is inadmissible for the reason already mentioned. I am in agreement with the lower appellate Court that no decree could be given in favour of the plaintiff on the basis of the original consideration in the circumstances of this case.
7. However, the learned counsel for the appellants is well founded in his contention that Ext. A-l was admitted in evidence and in view of Section 35 of the Kerala Stamp Act, corresponding to Section 36 of the Indian Stamp Act, the question of admissibility cannot be raised thereafter and the Courts have to treat the document as having been admitted in evidence. Section 35 of the Kerala Act reads as follows:–
“Admission of instrument where not to be questioned:– Where an instrument has been admitted in evidence, such admission shall not, except as provided in Section 59, be called in question at any stage of the same suit or proceeding on the ground that the instrument has not been duly stamped.”
In V.E.A. Annamalai Chettiar v. S.V.V.S. Veerappa Chettiar, AIR 1956 SC 12, the Supreme Court considered this question and said (at p. 14 of AIR);
“There is also a further difficulty in the way of the appellants and it is that the document having been admitted in evidence such admission could not be called in question at any stage of the proceedings on the ground that it had not been duly stamped. The provisions of Section 36, Stamp Act preclude the appellants from raising any objection against the admission of the document at this stage and the appellants are not entitled now to urge this objection before us.”
The Supreme Court, again, had occasion to consider this aspect in Javer Chand v. Pukh-raj Surana, AIR 1961 SC 1655. The Court said (at pp. 1656-1657 of AIR):
“Where a question as to the admissibility of a document is raised on the ground that it has not been properly stamped, it has to be decided then and there when the document is tendered in evidence. Once the Court rightly or wrongly, decides to admit the document in evidence, so far as the parties are concerned, the matter is closed. Section 35 is in the nature of a penal provision and has farreaching effects. Parties to a litigation, where such a controversy is raised, have to be circumspect and the party challenging the admissibility of the document has to be alert to see that the document is not admitted in evidence by the Court. The Court has to judicially determine the matter as soon as the document is tendered in evidence and before it is marked as an exhibit in the case. The record in this case discloses the fact that the hundis were marked as Exts. P-l and P-2 and bore the endorsement ‘admitted in evidence’ under the signature of the Court. It is not, therefore, one of those cases where a document has been inadvertently admitted,’ without the Court applying its mind to the question of its admissibility. Once a document has been marked as an exhibit in the case and the trial has proceeded all along on the footing that the document was an exhibit in the case and has been used by the parties in examination and cross-examination of their witnesses, Section 36 of the Stamp Act comes into operation. Once a document has been admitted in evidence, as aforesaid, it is not open either to the Trial Court itself or to a Court of Appeal or revision to go behind that order. Such an order is not one of those judicial orders which are liable to be reviewed or revised by the same Court or a Court of superior jurisdiction.”
A Division Bench of this Court considered this question in Ettuthara Warrier v. Kochu-narayana Menon, AIR 1962 Ker 265, and made the following observations (at p. 266 of AIR):-
“The words of the section are clear, and there can be no doubt that once a document has been admitted in evidence — as in this case — its admissibility cannot be questioned on the ground that it has not been duly stamped: Ma Pwa May v. Chettiar Firm, AIR 1929 PC 279. The expression “admitted in evidence” means “let in as part of the evidence”. To hold — as the respondent wants us to do — that a document should not be considered as having been admitted in evidence unless the Court has applied its mind to the question of admissibility from the point of view of the Stamp law will involve an addition to the section of the words “after judicially considering the question of sufficiency of stamp” after the words “admitted in evidence”, M. K. Lodhiv. Zia-ul-Haq, AIR 1939 All 588.
The matter again came up for consideration before a Division Bench of this Court in Raman v. Kunchu, 1967 Ker LT 640. After adverting to Section 36 of the Indian Stamp Act, the Court said:
“It was observed in Alagappa v. Narayanan, AIR 1932 Mad 765 that once a document is admitted in evidence by the lower Court under Section 35 of the Stamp Act such admission cannot be questioned at any later stage of the same suit or proceeding on the ground that the instrument has not been duly stamped and the natural consequence of that admission which has become final must also follow that the appellate Court cannot say that though it has been marked as an exhibit in the case it would not look into it and would not make use of it in the appreciation of the evidence or would not allow a decree to be passed in such a case.”
Dealing with the same question, the Andhra Pradesh High Court in Sree Rama Vara-prasada Rice Mill v. Takurdas Tapandas, AIR 1960 Andh Pra 155, said (at p. 160):
“This provision does not take away the finality provided for in Section 36 of the Stamp Act as to the admission of instruments by the trial Court. In Venkata Reddi v. Hussain Setti, AIR 1934 Mad 383, a bench of the Madras High Court has held that when once a document has been admitted in evidence after levying penalty on the foot of its being a bond, even though it may be acceptable point, the matter must be deemed to have been concluded and the admission of the instrument by the trial Court in evidence cannot be questioned.
It was argued in that case by the learned Advocate General that Section 36 would not apply to cases where a document in question forms the foundation of the suit. That argument was, if I may say so with great respect, rightly rejected. To the similar effect are the decisions in Ramaswami v. Ramaswami, (1882) ILR 5 Mad 220, Venkatrama Aiyar v. Chella Pilial, AIR 1921 Mad 413 and Venkateswara lyer v. Ramanatha Dee kshitar, AIR 1929 Mad 622, following the said authorities, I hold that inasmuch these instruments have been admitted in evidence, it is no longer open to the appellants to raise the question as to the insufficiency of the stamp duty paid on the instrument.”
Again in Hindustan Steel Ltd. v. Dilip Construction Co., AIR 1969 SC 1238, the Supreme Court made the following observations (at p. 1240 of AIR):–
“The stringent provisions of the Act are concerned in the interest of the revenue. Once that object is secured according to law, the party staking his claim on the instrument will not be defeated on the ground of the initial defect in the instrument. Viewed in that light the scheme is clear. Section 35, Stamp Act, operate as a bar to an unstamped instrument being admitted in evidence or being acted upon; Section 40 provides the procedure for instruments being impounded, Sub-section (1) of Section 42 provides for certifying that an instrument is duly stamped, and Sub-section (2) of Section 42 enacts the consequences resulting from such certification.”
The Supreme Court rejected the argument advanced on the basis of the decision in Mst. Bittan Bibi v. Kuntu Lal, AIR 1952 All 996 and said (at pp. 1240-1241 of AIR) :
“A Court is prohibited from admitting an instrument in evidence and a Court and a Public Officer both are prohibited from acting upon it. Thus a Court is prohibited from both admitting it in evidence and acting upon it. It follows that the acting upon is not included in the admission and that a document can be admitted in evidence but not be acted upon. Of course it cannot be acted upon without its being admitted, but it can be admitted and yet be not acted upon. If every document, upon admission, became automatically liable to be acted upon, the provision in Section 35 that an instrument chargeable with duty but not duly stamped, shall not be acted upon by the Court, would be rendered redundant by the provision that it shall not be admitted in evidence for any purpose. To act upon an instrument is to give effect to it or to enforce it.
In our judgment, the learned Judge attributed to Section 36 a meaning which the Legislature did not intend. Attention of the learned Judge was apparently not invited to Section 42(2) of the Act which expressly renders an instrument, when certified by endorsement that proper duty and penalty have been levied in respect thereof, capable of being acted upon as if it had been duly stamped.”
8. The learned counsel for the respondent, however, heavily relied on a decision of the Supreme Court in Ram Rattan v. Bajrang Lal, AIR 1078 SC 1393. In that case, the Supreme Court made the following observations (at p. 1395 of AIR):
“When the document was tendered in evidence by the plaintiff while in witness box, objection having been raised by the defendants that the document was inadmissible in evidence as it was not duly stamped and for want of registration, it was obligatory upon the learned trial Judge to apply his mind to the Objection raised and to decide the objection in accordance with law. Tendency sometimes is to postpone the decision to avoid interruption in the process of recording evidence and, therefore, a very convenient device is resorted to, of marking the document in evidence subject to objection. This, however, would not mean that the objection as to admissibility on the ground that the instrument is not duly stamped is judicially decided; it is merely postponed. In such a situation at a later stage before the suit is finally disposed of it would nonetheless be obligatory upon the Court to decide the objection. If after applying mind to the rival contentions the trial Court admits a document in evidence, Section 36 of the Stamp Act would come into play and such admission cannot be called in question at any stage of the same suit or proceeding on the ground that the instrument has not been duly stamped. The Court and of necessity it would be trial Court before which the objection is taken about admissibility of document on the ground that it is not duly stamped, has to judicially determine the matter as soon as the document is tendered in evidence and before it is marked as an exhibit in the case and where a document has been inadvertently admitted without the Court applying its mind as to the question of admissibility, the instrument could not be said to have been admitted in evidence with aview to attracting Section 36 (See Javer Chand v. Pukhraj Surana AIR 1961 SC 1655). The endorsement made by the learned trial Judge that “objected, allowed subject to objection”, clearly indicates that when the objection was raised it was not judicially determined and the document was merely tentatively marked and in such a situation Section 36 would not be attracted.”
The learned counsel for the respondent contended that when the document was tendered, the admission was objected to and the document was marked subject to the objection as to the admissibility and in the circumstances, this is a case, where the dictum laid down in Ram Rattan’s case (AIR 1978 SC 1393) (supra) would squarely apply, and the Court cannot refuse to consider the question of admissibility by reason of the applicability of Section 35 of the Kerala Stamp Act, corresponding to Section 36 of the Indian Stamp Act. Ext. A-l is the promissory note in question. There is an endorsement on the reverse of the document with the rubber stamp “admitted in evidence by consent on 3-1-1970, marked as Ext. A-l”. The learned Subordinate Judge has also initiated this endorsement. There is nothing there to indicate that it was admitted subject to objection as to the admissibility of the document. On the other hand, the endorsement shows that it was admitted by consent. However, the learned counsel for the respondent submitted that though there is such an endorsement on the reverse of Ext. A-l, as a matter of fact the admission of document was objected to when the document was tendered while P.W. 1 was examined, and the deposition P.W. 1 would show that there was objection. On a perusal of the deposition of P.W. 1, it can be seen that the admission was not objected to at the time when the document was tendered and the Court admitted and marked the document as Ext. A-l. After admitting Ext. A-l, the lawyer notice sent by the plaintiff was tendered and marked as Ext. A-2, and thereafter Ext. B-l was put to the witness and it is at that stage, the counsel objected to the marking of Ext. A-I stating that one of the stamps is not cancelled and the Court recorded in the deposition of P.W. 1 that the document was marked subject to any arguments on the point. Evidently, by the time the objection was raised, the document was admitted by consent as seen from the endorsement on Ext. A-l and it is really after tendering, making and admitting two other documents, objection was raised and the Court recorded in the deposition of P.W. I the above statement. Therefore, the principles laid down in Ram Rattan’s case (supra) are not applicable to the facts of this case since by the time objection was raised, it was already admitted and marked by consent. Subsequent objection raised by the counsel after admitting and marking two other documents cannot prevent the consequences mentioned in Section 35 of the Kerala Stamp Act, by reason of the admission of the document. There cannot be any doubt that it is obligatory on the part of the Court to judicially determine the question of admissibility as soon as the document is tendered in evidence and before it is marked as an exhibit in the case. As pointed out, in Javer Chand’s case (supra), the parties to a litigation, where such a controversy is raied have to be circumspect and the party challenging the admissibility of the document has to be alerted to see that the document is not admitted in evidence by the Court. However, once the document has been admitted and marked as an exhibit in the case and has been used by the parties in examination, Section 36 of the Indian Stamp Act corresponding to Section 35 of the Kerala Stamp Act comes into operation and it would not be open to the Court to go behind that order and such an order is not one of those judicial orders which are liable to be reviewed or revised by the Court with superior jurisdiction. It is true, as pointed out in Ram Rattan’s case (supra) that there is a practice prevailing in the trial Court to postpone the decision to avoid interruption in the recording evidence and mark the document subject to objection. But this is not the correct procedure as laid down in Javer Chand’s case (supra). When an objection is raised, the Court is bound to determine the question as to the admissibility and the Court is bound to apply its mind and determine the question before the evidence is marked and admitted. This procedure is not seen followed in many of the cases, and the decision is postponed and the document is marked provisionally. In the instant case, objection was raised only much after the marking and admission of the document. However, questions will arise when a document is admitted and marked subject to objection and the decision on admissibility is postponed. The Supreme Court has clearly laid down that this is not the correct procedure. I feel that it is necessary to issue a circular to the Subordinate Courts pointing out the necessity of applying its mind as to the question of admissibility of document when a document is tendered in evidence instead of postponing the decision.
9. The foregoing discussion would show that Ext. A-l was admitted in evidence with consent and that will preclude the defendant from contending that since one of the stamps is not cancelled, the document is not admissible. Once the document is admitted the case of the plaintiff stands proved and he is entitled to decree as prayed for.
In the result, the second appeal is allowed and the judgment and decree of the lower appellate Court are set aside and the decree of the trial Court is restored. In the circumstances of the case, the parties will bear their respective costs.
