9911796707
|
Home
Issues Involved:
1. Admissibility of the bill of exchange due to stamping. 2. Consideration and failure of consideration for the bill of exchange. 3. Liability of the defendant to pay interest. Issue-wise Detailed Analysis: 1. Admissibility of the bill of exchange due to stamping: The defendant argued that the bill of exchange was not duly stamped and therefore not admissible in evidence. The court examined Section 3 of the Indian Stamp Act, which outlines the instruments chargeable with duty. Article 13 of Schedule I pertains to "bill of exchange," and it was determined that no stamp duty is prescribed for a bill of exchange payable on demand. Despite being drawn on April 16, 1997, and payable on July 14, 1997, the bill falls within the ambit of Section 2(3)(b) of the Indian Stamp Act as it constitutes "an order for the payment of any sum of money...at any other stated period." Thus, the bill is considered payable on demand and not liable to stamp duty. The court cited precedents, including Bhanwar Lal v. Firm Mangalji Chhoteylal, to support this interpretation. Additionally, a notification dated August 1, 1989, remitted the stamp duty for usance bills of exchange payable within three months, drawn in favor of a commercial bank, and arising from bona fide commercial transactions. The court found all conditions of this notification satisfied, rejecting the first defense. 2. Consideration and failure of consideration for the bill of exchange: The defendant contended that there was no consideration or a failure of consideration, making them not liable as an acceptor of the bill of exchange. The court noted that the defendant admitted in their affidavit that there was consideration for the bill of exchange, evidenced by their business relations with Rosmira Diamonds Bavba and the acceptance of the bill. The defendant's claim that payments were to be made by Rosmira to the bankers was deemed irrelevant to the plaintiff, who was not a party to this arrangement. The court emphasized that the receipt of diamonds by the defendant was admitted, establishing consideration for the bill of exchange. The defense of want or failure of consideration was found to be dishonest, and the court rejected this defense. 3. Liability of the defendant to pay interest: The defendant argued that the bill of exchange, being a foreign instrument, did not attract the provisions of Section 80 of the Negotiable Instruments Act, which specifies interest at 18% per annum when no rate is specified. The court found no basis for this argument, stating that Section 80 applies to both inland and foreign bills. The bill of exchange in question was silent on the rate of interest, entitling the plaintiff to interest at 18% per annum. The court dismissed the defendant's reliance on an unreported judgment in Dorbyl Eastern Cops Division of Dorbyl Ltd. v. m. v. Navigator, as it was not applicable to the present case involving the Negotiable Instruments Act. Conclusion: The court found no defense to the suit, making the summons for judgment absolute and decreeing the suit as prayed. The plaintiff was entitled to recover the sum of US $121,180.08 together with interest at 18% per annum from April 1, 1999, until payment.
|
