Author Name:   YSRAO JUDGE

The sum of money promised to be paid must be certain and definite amount. The law relating to ‘Negotiable Instruments’ in a Bills of Exchange Act, is codified in the commonwealth. Almost all jurisdictions, including in New Zealand, UK, Mauritius, codified the law as to negotiable Instruments. In India, The Negotiable Instrument Act, 1881 came into force. To understand the meaning of negotiable instrument, it is suffice to say that it means a promissory note, bill of exchange or cheque payable either to order or to bearer. During the Renaissance, Promissory note was in use in Europe. Later, during 20th century, the instrument changed substantially both in use and form and certain claused were added.

A Brief Note On Promissory Note

The sum of money promised to be paid must be certain and definite amount. The law relating to ‘Negotiable Instruments’ in a Bills of Exchange Act, is codified in the commonwealth. Almost all jurisdictions, including in New Zealand, UK, Mauritius, codified the law as to negotiable Instruments. In India, The Negotiable Instrument Act, 1881 came into force. To understand the meaning of negotiable instrument, it is suffice to say that it means a promissory note, bill of exchange or cheque payable either to order or to bearer. During the Renaissance, Promissory note was in use in Europe. Later, during 20th century, the instrument changed substantially both in use and form and certain claused were added.

History of Promissory note:
Common prototypes of bills of exchanges and promissory notes originated in China. Here, in the 8th century during the reign of the Tang Dynasty they used special instruments called feitsyan for the safe transfer of money over long distances.[1] Later such document for money transfer used by Arab merchants, who had used the prototypes of bills of exchange – suftadja and hawala in 10–13th centuries, then such prototypes had used by Italian merchants in the 12th century. In Italy in 13–15th centuries bill of exchange and promissory note obtain their main features and further phases of its development have been associated with France (16–18th centuries, where the endorsement had appeared) and Germany (19th century, formalization of Exchange Law). In England (and later in the U.S.) Exchange Law was different from continental Europe because of different legal systems

Section 4 of the Negotiable Instruments Act, 1881:
"Promissory note".-
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.

To understand the term word ‘promissory note’ clearly, it is apt to refer the following ruling of the Hon’ble High Court of Andhra Pradesh.

Bolisetti Bhavannarayana @ ... vs Kommuru Vullakki Cloth Merchant ... ;1996 (1) ALD Cri 530, 1996 (1) ALT 917; Bench: K Agarwal, V R Reddy, N S Reddy; in this case , the following question came for consideration.

Whether the suit document is a Promissory Note? If not, what is its nature?
To answer this question, it was held as follows: ‘ As to the first question, we may remind ourselves of the fact that the Indian Stamp Act, 1899, (in short, the "Stamp Act"), levies stamp duty on various documents at varying rates and, therefore, it becomes necessary first to determine the nature of any document before deciding the question of proper stamp duty payable on such document. Accordingly the definition of a 'bond' or a 'promissory note' as given in the Stamp Act alone is material for the purpose of determination of the nature of any document. Section 2(22) of the Stamp Act defines 'promissory note' as follows:

"Promissory note" means a promissory note as defined by the Negotiable Instruments Act, 1881;

"It also includes a note promissing 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 the context of this definition of "promissory note" given in Section 2(22) of the Stamp Act, the definition of the term as given in Negotiable Instruments Act, 1881 assumes importance. Section 4 of the latter act defines "promissory note" 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.

Illustrations
A signs instruments in the following terms:
(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".

(d) "I promise to pay B Rs. 500, and all other sums which shall be due to him."

(e) "I promise to pay B Rs. 500, first deducting thereout any money which he may owe me."

(f) "I promise to pay B Rs. 500 seven days after my marriage with C."

(g) "I promise to pay B Rs. 500 on D's death, provided D leaves me enough to pay that sum."

(h) "I promise to pay B Rs. 500 and to deliver to him my black horse on 1st January next."

The instruments respectively marked (a) and (b) are promissory notes. The instruments respectively marked (c), (d), (e), (f), (g) and (h) are not promissory notes."

This definition of promissory note itself indicates that there may be several types of promissory notes. Out of these various categories of promissory notes, some may be treated as 'negotiable instrument' within the meaning of Section 13 of the Negotiable Instruments Act and some others may not be so treated, but by that very fact, the nature of the document will not change, if it is otherwise a promissory note. In other words, if a document is a 'promissory note' within the meaning of Section 4 of the Act, it will continue to be 'promissory note', whether it comes or does not come within the meaning of the term 'negotiable instrument' as defined in Section 13 of the Act. For this reason, were are of the view that Section 13 of the Negotiable Instruments Act, or the definition of the term 'negotiable instrument' is wholly irrelevant when it comes to deciding the nature of a particular document as a promissory note, or otherwise. Similarly and for similar reasons, it is wholly irrelevant to refer to the provisions of Section 13 of the Act while deciding the nature of any document as a 'bond' or otherwise. Accordingly anything to the contrary held in any of the authorities referred to in the orders of reference is not a good law.’

Promissory note is not a compulsorily attestable document:
Genearally no attestors are necessary to execute a promissory note. In Chandabolu Bhaskara Rao’s case, the Honble High Court of A.P held that ‘Since promissory note is not a compulsorily attestable document, even if the signatures of the attestors are taken, after its execution it does not amount the material alteration, and so it does not get vitiated. Therefore, whether there were attestors or not at the time of its execution is immaterial, more so when its execution is admitted.

The Hon’ble Full Bench Judgment of Madras High Court reported in Hariram v. I.T. Commissioner, (F.B.). In this case the following document was under consideration, which reads as follows:

"Promissory note executed on 14-6-1947 in favour of Arunachala Chettiar, son of Kolakkara Chettiar residing at Palappudi Village, hamlet of Sathyamangammal, Gingi Taluk by Kuppuswami Chettiar, son of Venkatachala Chettiar, residing at the aforesaid village. In respect of the sum received from you at Tiruvannamalai by me in the year 1943 and given for opening a Javuli shop by T. Arunachala Iyer the sum found due to you is Rs. 3,000. As this sum of rupees three thousand had to be paid to you, I shall pay the same together with interest at Rs. 0-4-0 per month per Rs. 100 in six equal instalments, and discharge the same. To this effect is the promissory note executed by me with my consent."

Their Lordships held that the document in question is not a promissory note, because there is no unconditional undertaking to pay a certain sum of money.

The distinction between the promissory note and hundi or bill of exchange is explained by his lordship Vradachariar, J., in these words :

"But where the borrower gives his own promissory note as part of the loan transaction, it seems to me artificial to treat that every ' promise to pay ' obtained in that note as amounting to a payment, and then to seek to import the theory of ' conditional ' payment. "

If Promissory Note Is In-Admissible- Remedy:
1). "1. Whether a plaintiff can bring action for recovery of the amount advanced by him basing on the original consideration when the promissory note on foot of which action is brought is in-admissible in evidence under Section 35 of the Stamp Act, and, if so, under what circumstances ?

2. If the promissory note is in-admissible in evidence, whether action can be maintained for recovery of the amount either on the theory of " money had and received " or under the provisions of Section 70 of the Contract Act. "

2). The question referred to the Hon’bel Bench of seven Judges by a Division Bench to which two of their lordships Obul Reddi and Madhava Reddy, JJ. were members, is

"Whether a plaintiff can lay action for recovery of the amount advanced by him basing on the original cause of action when the negotiable instrument evidencing the transaction is inadmissible in evidence under Section 35 of the Stamp Act. "

The necessity to refer the question to a larger Bench arose as a result of the view expressed by Gopal Rao Ekbote, J. ( as he then was ) in Mohd. Jamal Saheb v. Munnar Begum, , which does not accord with the ruling of the Full Bench of the Madras High Court in Perumal Chettiar v. Kamakshi Ammal, ILR ( 1938 ) Mad 933 = ( AIR 1938 Mad 785 ( FB ) ). The learned Judge, Gopal Rao Ekbote, held that the plaintiff can have his money back through the document is in-admissible in evidence because it is in-sufficiently stamped and that Section 91 of the Evidence Act is no bar to the plaintiff succeeding on a non-contractual basis, that is, in an action for money had and received. In so coming to the conclusion, the learned Judge seems to have felt that he is not bound by the decision of the Full Bench in ILR ( 1938 ) Mad 933 = ( AIR 1938 Mad 785 ( FB ) as " two decisions decided in 1918 by the Privy Council ( John v. Dodwell and Co. Ltd. AIR 1918 PC 241 and Juscurn Boid v. Prithichandlal, AIR 1918 PC 151 ) were not brought to the notice of the Full Bench ". Having regard to the fact that the High Courts of Allahabad, Bombay and some other High Courts have taken a view different from that expressed by the Full Bench of five Judges of the Madras High Court in ILR ( 1938 ) Mad 933 ( 935 ) = ( AIR 1938 Mad 785 ( FB ) the question posed above was referred for consideration by a larger Bench.

Promissory Note Requires Proper Stamp Duty:
Venkatasubbaiah v. Bhushayya, 1963 (1) An.WR (NRC) 31. That was a case in which the Hon’ble High Court of A.P considered the fact of Section 35 of the Stamp Act. It held that the promissory executed in other State was liable for stamp duty in the State where it was produced, and for not paying necessary stamp duty, the document would be inadmissible. For such a contingency Section 19 of the Indian Stamp Act would apply. According to this Section, promissory note drawn or made out of India shall, before it is presented for acceptance or payment or endorses, transfers or otherwise negotiate in India, affix thereto the proper stamp and cancel the same. Prima facie the said section would not apply to the promissory note executed in India, and any promissory note executed in one State may be presented in any other State in India with the stamp bearing on the promissory note, no additional stamp duty need be paid. Section 19 contemplates that a promissory note drawn out of India and used in India or any State, it requires proper stamp duty as per Indian Law.

Recommendations For Amending Section 35 Of The Stamp Act, 1899
I deem that it is not out scope to see 178th Report of the Law Commission of India, as to recommendations for amending section 35 of the Stamp Act , 1899 & ‘bills of exchange on promissory notes’. The relevant portion of the report reads as follows:

Section 35 of the Stamp Act, 1899 & ‘Bills of exchange on promissory notes’:

The opening part of sec. 35 of the Stamp Act, 1899 provides as follows: ‘No instrument chargeable with duty shall be admitted in evidence for any purpose by any person having by law or consent of parties authorized to receive evidence, or shall be acted upon, registered or authenticated by any such person or by any public officer, unless the instrument is duly stamped’.

Clauses (a) to (e) of the proviso to the above sec. 35 contain provisions which permit the instrument to be used as evidence upon payment of the stamp duty in full (where it is unstamped) or upon payment of the deficient stamp duty (where there is deficiency in the stamp duty ) and the proviso permits the collection of penalty up to a maximum of ten times the stamp duty or the deficiency, as the case may be. Levy of penalty is of course discretionary

However, clause (a) of sec. 35 does not permit the validation of the instrument as stated above, in the case of ‘a bill of exchange or promissory note’. The result is that while in regard to all other instruments there is a procedure prescribed for subsequent validation of the instrument by collection of the stamp duty or penalty, such a procedure is not available in the case of “bills of exchange and promissory notes”. Even if the party who wants to use it as evidence is prepared to pay the stamp duty and penalty, he is not allowed to do so, so far as these instruments are concerned. The document become ‘waste paper’. On account of this rigid procedure applied only to “bills of exchange and promissory notes”, several debtors are allowed to escape liablility unjustly.

The Indian courts have also not been able to render justice in such cases where one party relies upon a “bill of exchange or promissory note” which is not stamped or is deficiently stamped. In addition, the provisions of sec. 91 of the Evidence Act also come in the way and preclude oral evidence being adduced in such cases. This is clear from illustration (b) below section 91 of the Evidence Act. These disabilities have led to a large volume litigation in courts. The Privy Council, the Supreme Court and the High Court have declared their helplessness in getting over these provisions of sec. 35 in so far as they disable validation of “bills of exchange and promissory notes”. The result is that these instruments are not allowed to be used as evidence ‘for any purpose’.

In one novel case in the Andhra Pradesh High Court during the time when our currency shifted from the old system of “rupees, annas and paise” to the present system of ‘naya-paise’, a promissory note which had to bear a stamp duty of 4 annas under the Stamp Act was executed on a document bearing stamp duty of ‘twenty four’ naya-paise on the undertaking that each anna was equal to six naya paise. But, under the new system, the correct equivalent of 4 annas was 25 paise, and the suit was dismissed on the ground of deficiency of stamp duty of one naya paisa. The law never changed. In fact, a special bench of seven Judges of the Andhra Pradesh High Court in L. Sambasivarao vs. Balakotaiah AIR 1973 AP 343 (FB) affirmed an earlier judgment of five Judges of the Madras High Court in Perumal Chettiar vs. Kamakshi Ammal (AIR 1938 Mad 785 (FB)). The judgment of the Andhra Pradesh High Court is exhaustive and refers to the entire cased law on the subject. In fact it refers to 133 decisions of various courts. The question is whether this injustice which is the result of the Act of 1899 is to be remedied by enabling the deficiency to be paid, with or without penalty, as may be decided by the competent authority.

In some cases, courts invented various theories to grant relief, by holding that the ‘bill of exchange or promissory note’ was a collateral security or that it did not contain all the terms of the contract and therefore sec. 91 of the Evidence Act could not exclude oral evidence. In some other cases, Courts have stated that there could be an action on the debt. However, whenever such pleas of inadmissibility are raised, there is unending litigation and uncertainty. A party would not know if any such plea would ultimately be accepted for getting over the rigid posture of sec. 35 of the Stamp Act and the equally strict rule in sec. 91 of the Evidence Act.

In our view, justice to those who have parted with money under a bill of exchange or a promissory note, requires that this provision in sec. 35 be deleted and that the procedure for paying up the stamp duty or penalty, is made applicable to these instruments also. That will further augment the revenues of the State. Such a procedure will also eliminate unnecessary disputes as to whether the plaint can be amended by permitting the plaintiff to sue on the debt and also eliminate disputes as to admissibility of oral evidence.

The Commission, after due consideration of various aspects, namely, rendering justice to those who have parted with money, the benefit that will accrue to the State by way of collection of stamp duty or penalty, and elimination of unnecessary disputes, is of the considered view that in the proviso (a) of sec. 35 of the Stamp Act, 1899, the words “any such instrument not being an instrument chargeable with a duty not exceeding ten naya paise only, or a bill of exchange or promissory note, shall subject to all just exceptions be admitted in evidence”, the words “any such instrument shall be admitted in evidence”, shall be substituted It is also proposed to give limited retrospective operation to this amendment in all cases where proceedings before the courts or authorities referred to under sec. 35 have not reached.

Scope of The Presumption: Burden Of Proof In Promissory Note Cases:
The Hon’ble Supreme Court in Kundan Lal Rallaram v. Custodian, Evacuee Property, Bombay [AIR 1961 SC 1316], speaking through his lordship K. Subba Rao, J. considering the scope of the presumption had laid down the law thus:

"Section 118 lays down a special rule of evidence applicable to negotiable instruments. The presumption is one of law and thereunder a court shall presume, inter alia, that the negotiable or endorsed for Consideration. In effect it throws the burden of proof of failure of consideration on the maker of the note or the endorser, as the case may be. The phrase "burden of proof" has two meanings- One, the burden of proof as a matter of law and pleading and the other the burden of establishing a case; the former is fixed as a question of law on the basis of the pleading and so unchanged during the entire trial whereas the latter is not constant but shifted as soon as a party adduces sufficient evidence to raise a presumption in his favour. The evidence required to shift the burden need not necessarily be directed evidence or admissions made by opposite party; it may comprise circumstantial evidence or presumptions of law or fact. A plaintiff who says that he had sold certain goods to the defendant and that a promissory note was executed as consideration for the goods and that he is in possession of the relevant account books to show that he was in possession of the goods sold and that the sale was reflected for a particular consideration should produce the said account books. If such a relevant evidence is withheld by the plaintiff, S.114, Evidence Act enables the Court to draw a presumption to the effect that, if produced, the said accounts would be unfavourable to the plaintiff. This presumption, if raised by a court, can under certain circumstances rebut the presumption of law raised under Section 118 of the Negotiable Instrument Act."

‘ In Haribhavandas Parasaran and Co. v. A.D. Thakur A.I.R. 1963 Mys. 107, it was held that- It is mandatory that the presumption under Section 118(a) should be made until the contrary is proved. The fact that the nature of the consideration as recited in the negotiable instrument is different from that alleged in the plaint may have to be considered by the Court at a later stage, along with the entire evidence in this case, while determining whether the contrary to the statutory presumption has been proved. But, the mere existence of such a fact would not, by itself, be a justification for the Court to disregard Section 118 and frame an issue casting burden on the plaintiff to prove the consideration for a negotiable instrument, the execution of which has been admitted. The burden should still be on the defendant to prove want of consideration.’

In Kundanlal v. Custodian, Evacuee Property , it was observed ‘With particular reference to Section 118 of the Negotiable Instrument's Act, the Supreme Court observed thus: As soon as the execution is proved, Section 118 of the Negotiable Instruments Act imposes a duty on the Court to raise a presumption in his favour that the said instrument was made for consideration. This presumption shifts the burden of proof in the second sense, that is, the burden of establishing a case shifts to the defendant. The defendant may adduce direct evidence to prove that the promissory note was not supported by consideration, and if, he adduced acceptable evidence, the burden again shifts to the plaintiff and so on. The defendant may also rely upon circumstantial evidence and if the circumstances so relied upon are compelling, the burden may likewise shift again to the plaintif’.

In Alex Mathew v. Philips a Division Bench of the Kerala High Court had occasion to consider the same question and the Bench held-

The true principle where different cases have been pleaded and evidence has been let in, in support of both these sets of cases, is that the entire evidence in the case adduced by the plaintiff and the defendant and the findings entered by the Court or which are to be altered by the Court as well as the presumptions of law and fact which have to be drawn from all the facts established and attendant circumstances must be looked into as a whole to find out whether the presumption under Section 118(a) of the Act has been rebutted or not. It would not be correct merely on the basis of the finding negativing the case of the plaintiff regarding consideration to hold that the presumption under Section 118(a) has been rebutted.

In Palaniappa Chettiar v. Rajagopalan A.I.R. 1928 Mad. 773. a Division Bench of the Hon’ble Madras High Court held that where the recital of the consideration in the pro-note is admittedly false, the burden of proving consideration is shifted on to the holder of the promissory note as against the maker of the note himself and much stronger, therefore, would be the case when the consideration has to be proved against third parties.

In G. Venkata Reddi v. Nagi Reddi . Basheer Ahmed Sayeed, J., in dealing with a similar question with reference to the burden of proof when the recital in the negotiable instrument regarding consideration is not made out, (where the recital in the promissory note was that consideration was paid, but in the plaint it was pleaded that the consideration was lease amount, that was due from the defendant) held that the decision in Palaniappa Chettiar v. Rajagopalan A.I.R. 1928 Mad. 773. would prevail, as otherwise it will cause serious injustice.

To know more about the history of promissory note, the following rulings may be helpful to have a clear idea.
1. Mohd. Jamal Saheb v. Munnar Begum, , which does not accord with the ruling of the Full Bench of the Madras High Court in Perumal Chettiar v. Kamakshi Ammal, ILR ( 1938 ) Mad 933 = ( AIR 1938 Mad 785 ( FB ) ).

2. The decision of the Full Bench in ILR ( 1938 ) Mad 933 = ( AIR 1938 Mad 785 ( FB ) as " two decisions decided in 1918 by the Privy Council ( John v. Dodwell and Co. Ltd. AIR 1918 PC 241 and Juscurn Boid v. Prithichandlal, AIR 1918 PC 151 )

3. The Full Bench of five Judges of the Madras High Court in ILR ( 1938 ) Mad 933 ( 935 ) = ( AIR 1938 Mad 785 ( FB )

4. Pithi Reddy v. Velayudasivan, ( 1885-1887 ) ILR 10 Mad 94 and Perumal Chettiar's case, ILR ( 1938 ) Mad 933 = ( AIR 1938 Mad 785 ( FB ) )

5. The Full Bench in Perumal Chettiar's case. ILR ( 1938 ) Mad 933 = AIR 1938 Mad 785 (FB)

6. The Full Bench of the Madras High Court in Perumal Chettiar's case. ILR (1938) Mad 933 = AIR 1938 Mad 785 ( FB ), is not correct and the decision requires to be overruled.

7. In Perumal Chettiar's case. ILR (1938) Mad 933 = AIR 1938 Mad 785 (FB) it was the third view that was expressed by the Full Bench.

8. Sheikh Khan, (1881) ILR 7 Cal 256,

9. Golap Chund Marwaree v. Thakurani Mohokoom Kooaree. (1878) ILR 3 Cal 314

10. Pramatha Natha Sandal v. Dwarka Nath Dey. (1896) ILR 23 Cal 851,

11. That opinion of Petheram. C.J., was based on what is stated in Farr v. Price, (1800) 1 East 55 = 102 ER 22 viz. That the existence of an unstamped promissory note does not debar the plaintiff from recovering on the original consideration if the pleadings are properly framed for that purpose.

12. In Indra Chandra v. Hiralal Rong. AIR 1936 Cal 127 and Mahatobuddin Mia v. Md, Nazir Joddar AIR 1936 Cal 170 R.C.Mitter. J., sitting single, held that it is not necessary that there should be an independent express contract prior to the execution of such a promissory note and that the fact that the money has been lent implies a promise to repay it and the plaintiff in such a case has a cause of action on the implied promise, which is independent of the promissory note.

13. Firm Tarachand v. Tamijuddin, AIR 1935 Cal 658 where he said that if the plaintiff's cause of action to recover the money had become complete before the execution of the promissory note, he would be entitled to sue and succeed on the original: but if he does not base his case in the plaint on the original consideration, he is out of Court because the promissory note is inadmissible in evidence being insufficiently stamped.

14. The Privy Council in Sadasuk Janki Das v. Sir Kishen Pershad, SIR 1918 PC 146 and followed the decision in Sheik Akbar v. Sheikh Khan, (1881) ILR 7 Cal 256 and Nazir Khan, v. Raz Mohan, AIR 1931 ALL 185 (FB). His view in the 1935 case was that if the execution of the promissory note and the borrowing of the money are contemporaneous constituting part and parcel of the same transaction and the note becomes inadmissible in evidence the plaintiff will be out of Court. The learned Judge with great respect to him seemed to swing between the two stands taken by the two Chief Justices of his Court.

15. Krishnaji Narayan Parkhi v. Rajamal Manikchand Marwari, (1900) ILR 24 Bom 360 was dealing with a case of liability arising out of a hundi.

16. Chenbasapa v. Lakshman Ramachandra, (1894) ILR 18 Bom 369. Where the distinction between cases in which the suit is brought solely on the note or hundi and cases in which there is and can be a claim to recover the original loan has been acknowledged.

17. Jacob 7 Co.v. Vicumsey. AIR 1927 Bom 437, followed the decision in (1900) ILR 24 Bom 360 on the ground that it is binding upon him, in holding that if the promissory note is insufficiently stamped the plaintiff can proceed with the suit on the loan.

18. As the latest opinion of the Allahabad High Court as expressed in AIR 1943 All 220 and is in conflict with the Full Bench decision of the Madras High Court in Perumal Chettiar's case, ILR ( 1938 ) Mad 933 = ( AIR 1938 Mad 785 ) ( FB )

19. ( 1882 ) ILR 4 All 330, it was observed that :"Much though we might have wished to be able to hold that the bond entered into between the parties did not preclude the plaintiff-appellant from recovering on his account stated, we find ourselves unable to do so. "

20. Ram Sarup v. Jasodha Kunwar, ( 1912 ) ILR 34 All 158 which runs counter to the above view was rested on the dictum of Lord Kenyon in the well-known case of (1800) 1 East 55 = 102 ER

21. Banarasi Prasad v. Fazl Ahmad, (1906) ILR 28 All 298, though purported to follow the case of (1881) ILR 7 Cal 256

22. Baijnath Das v. Salig Ram, (1912) 16 Ind Cas 33 (All)

23. AIR 1929 All 254 and the view expressed by the learned Judges was quoted and endorsed by Sir Lionel Leach, C. J. in Perumal Cettiar's case, ILR (1938) Mad 933 = (AIR 1938 Mad 785) (FB) to the extent of the scope of Section 91 of the Evidence Act.

24. Baijanath Das's case (1912) 16 1nd Cas 33 (ALL)

25. AIR 1931 ALL 183 (FB) overruled the decisions in (1912) ILR 34 AII158 and (1906) ILR 28 AII 293 referred to supra and followed the decisions Parsotham Narain v. Taley Singh, (1903) ILR 26 AII 178 and Sheikh Akbar v. Sheikh Khan. (1882) ILR 7 Cal 256.

26. Miyan Bux v. Mt. Bodhiya, AIR 1928 AII 371 (SB).

27. A Full Bench of five Judges in AIR 1943 All 220 ( FB ).

28. A Full Bench of the Oudh High Court consisting of Wazir Hasan, C. J. Srivastava and Raza, JJ. However, took a different view from the one expressed in AIR 1931 All 183 ( FB )

29. The Full Bench case in AIR 1943 All220.

30. The Full Bench decision in AIR 1921 All 183 ( FB ) required reconsideration.

31. Maung Chit v. Roshan and Co., AIR 1934 Rang 339 = ILR 12 Rang 500 ( FB ). He, however, found himself unable to agree with the 4th and 6th propositions of Sir Arthur Page C. J. ( which were endorsed by the Full Bench of the Madras High Court ) on the ground that he ( Page C. J. ) did not correctly state the law.

32. Ram Bahadur v. Dasuri Ram, ( 1913 ) 17 Cal LJ 399.

33. Mohd. Akbar Khan v. Attar Singh, 1936 All LJ 986 = AIR 1936 PC 171.

34. A division Bench of the Allahabad High Court in following the Full Bench decision in AIR 1943 All 220 ( FB)

35. The Full Bench decision, the question can scarcely be regarded as settled ; ( Dhaneshwar Sahu v. Ramrup Gir, ILR 7 Pat 845 = ( AIR 1928 Pat 426) where Macpherson, J., concerned only on the ground of stare decisis.

36. A Division Bench of the Patna High Court in Sarajoo Prasad v. Rampawari Devi. considered the question whether every loan carried with it a contract to repay and if so, it was open to the plaintiff to bring a suit on the original consideration of the handnote.

37. Udaram Mangiram v. Laxman Marwari, AIR 1927 Nag 241 held that even though the promissory note becomes inadmissible in evidence for want of proper stamp, the creditor can fall back on the original transaction under Section 70 of the Contract Act treating the promissory note as non-existent and ask for refund of the consideration paid. This decision supports the view of the learned Judge in , but runs counter to the Madras Full Bench view in Perumal Chettiar's case. ILR (1938) Mad 933 = AIR 1938 Mad 785 (FB).

38. Gulam Mohad. Labroo v. Habib Ullah. AIR 1966 J & K 127. After an elaborate review of the cases expressing divergent views, disagreed with the view expressed by the Full Bench of the Allahabad High Court in AIR 1943 AII 220 (FB).

39. K. Anantharajaiah v. Shivaramaiah. AIR 1968 Mts 148

40. The Full Bench decision of the Rangoon High Court in AIR 1934 Rang 389 = ILR 12 Rang 500 (FB) which was approved by the Full Bench of the Madras High Court.

41. When a loan is contracted it is an implied term of the agreement that the loan shall be repaid (1913) 41 1nd App 142 (PC)

42. When a promissory note or a bill of exchange or indeed anything else, is given by the narrower to the lender in connection with the loan, either at the time when the loan is contracted or afterwards, the terms upon which it is given and taken is a question of fact and not of law, (1889) 22 QBD 610.

43. Re Romer and Haslam, (1893) 2 QB 286 at p. 296 and Bowen. L.J. (Ibid. P. 300):Farr v. Price (1800) 1 East 55 = (102 ER 22)

44. Commr. Of Income-tax, Bombay v. Ogale Glass Works Ltd., ( 1885-1887 ) ILR 10 Mad 94 and also the two of the cases in Gopala Padayachi v. Rajagopal Naidu, AIR 1926 Mad 1148 and Chinnayya Naidu v. Srinivasa Naidu, AIR 1935 Mad 206 = ( 67 ad LJ 912 ) which struck a different note were referred to in main judgment of Sir Lionel Leach, C. J., and in the judgment of Justice Varadachariar, Krishnasami v. Rangaswami, ( 1884 ) ILR 7 Mad 112

45. Pothireddy's case, ( 1885-1887 ) ILR 10 Mad 94,

46. Muthusastrigal v. Viswanatha, ILR 38 Mad 660 at p. 663 = ( AIR 1914 Mad 657 (2) ).

47. Dula Meah v. Abdul Rahaman, 28 Cal WN 70 = 81 Ind Cas 461 = ( AIR 1924 Cal 452 ),

48. The case of Brown v. Watts, ( 1808 ) 127 ER 870,

49. Re Romer & Haslam, ( 1893 ) 2 QB 286

50. Crowe v. Clay, ( 1854 ) V. 9 Exch

51. Payana Reena Saminathan v. Pana Lena Palaniappa, (1913 ) 41 Ind App 142 ( PC )

52. Dargavarabu Sarrapu v. Rampratabu ( 1902 ) ILR 25 Mad 580 ( FB )

53. Jambhu Chetty v. Palaniappa Chettiar ( 1903 ) ILR 26 Mad 526,

54. Palaniappa Chetty v. Arunachellam Chetty, ( 1911 ) 21 Mad LJ 432

55. Felix Hadley & Co. v. Hadley ( 1898 ) 2 Ch 680 and Lord Maugham in Rhokana Corpn. Ltd. v. Inland Revenue Commrs. 1938 AC 380 observed at p. 433 :

56. Chitty on Contracts ( Twenty-third Edition )

57. The book on Bills of Exchange ( Twenty-second Edition ) at page 392 :

58. Taylor on Evidence Vol. 1 P. 276 ( 12th Edition

59. The Madras High Court in AIR 1926 Mad 1148 and AIR 1935 Mad 206, which conflict with Pothi Reddy's case, ( 1885-1887 ) ILR 10 Mad 94, for those two decisions were referred to and overruled by the Full Bench.

60. Pothi Reddy's case ( 1885-1887 ) ILR 10 Mad 94, and Sheik Akbar v. Sheikh Khan, ( 1881 ) ILR 7 Cal 256

61. Chanda Singh v. Amritsar Banking Co., AIR 1922 Lah 307

62. Ram Jas v. Shahabuddin, AIR 1927 Lah 89.

63. Sohan Lal Nihal Chand v. Raghu Nath Singh, AIR 1934 Lah 606

64. Amin Chand v. Firm Madho Rao Banwari Lal, .

65. The two decisions of the Privy Council in AIR 1918 PC 241 and AIR 1918 PC 151

66. Sadasuk Janki Das's case, AIR 1918 PC 146

67. Three decisions of the Supreme Court in State of West Bengal v. B. K. Mondal and Sons, ; New Marine Coal Co. v. Union of India,and Mulamchand v. State of Madhya Pradesh,

68. The case of a Royal Bank of Canada v. The King, 1913 AC 283, was an appeal from the judgment of the Supreme Court of Alberta. The main controversy was as to the validity of the statute ( Alberta Act 1 Geo 5 C 9 ) passed in 1910, dealing with the sale of certain bonds.

69. Wilson v. Church, ( 1879 ) 13 Ch D 1 at p. 49,

70. Moses v. Macferlan, ( 1760 ) 97 ER 676

71. Sinclair v. Brougham, 1914 AC

72. see Smith's Leading Cases, Notes to Marriot v. Hampton, ( 1797 ) 7 TR 269 = 2 Sm LC ( 11th Ed. ) 421)

73. Brook's Wharf and Bull Wharf Ltd. V. Goodman Brothers, )1937 1 KB 534,

74. 1914 AC 398 by P.H. Wins-field in (1937) 53 LQR 447.

75. The case of Fibrosa Spolka Akcyjna v. Fairbarin Lawson Combe Barbour Ltd., 1943 AC 32 ;

76. Lothamasu Sambasiva Rao vs Thadwarthi Balakotiah: AIR 1973 AP 342

Conclusion:
This article does not give information as to all the aspects of promissory note, for instance, I did not touch on the aspect of material alterations of the promissory note, the plea of forgery, fabrication, ect.,. Inasmuch as there are catena of rulings on the ‘promissory note’, it is very difficult to discuss all the case-law. However, I attempted to put forth some rulings on this aspect. A close scrutiny and understanding the dicta observed in the above rulings, I am in no doubt to say our knowledge on the aspect of Promissory note will be enriched. There are certain amendments are needed as to section 35 of the stamp act, 1899 & ‘bills of exchange on promissory notes. It is not out scope to remember the words of Lord Atkin "Being primarily a receipt, even if coupled with the promise to pay, it was not a promissory note. As the document did not record or purport to record all the terms of the contract between the parties and as there was nothing in the document explaining how the money came to be received the parties were not prevented from showing that it was paid by way of loan or deposit or for some other purpose. ".
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# Chandabolu Bhaskara Rao vs Betha Saidi Reddy; decided on 5 April, 2006
# Lothamasu Sambasiva Rao vs Thadwarthi Balakotiah ; AIR 1973 AP 342
# Law Commission of India; One hundred and seventy eighth report On recommendations for amending various enactments, Both civil and criminal.; December,2001
# Observed in K.P.O. Moideenkutty Hajee vs Pappu Manjooran & Anr ; JT 1996 (3), 329 1996 SCALE (2)784; Bench: Justice Ramaswamy, K.
# In Kundanlal v. Custodian, Evacuee Property (1963) 1 S.C.J. 347 : (1963) 1 An.W.R. (S.C.) 85 : (1963) 1 M.L.J. (S.C.) 85 : A.I.R. 1961 S.C. 1316.

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