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TMI Blog1968 (8) TMI 206X X X X Extracts X X X X X X X X Extracts X X X X ..... twenty-two are to be paid. Signed Misrimal KunanmaL Signed Premraj. Witness - Sewag Pukhraj at Ranawas at the instance of Mishri Mal of Marwar Junction in his presence. The defendants contested the suit on several grounds, one of them being that the entry Ex. 1 was merely an acknowledgment and that it could not be made the basis of the suit. The trial Court repelled this contention, dismissed other objections and passed a decree for ₹ 6215/- with costs and future interest. On the defendants' appeal, the District Judge came to the conclusion that the entry on which the suit was founded was nothing more than a mere acknowledgment and as such, the suit could not be based thereon. Accordingly, he allowed the appeal, set aside the trial Court's decree and dismissed the suit with costs. He relied on the decisions of this Court in Hastimal v. Shankerdan (AIR 1952 Raj 7 (FB)) : ILR (1951) 1 Raj 297 and Ramdayal v. Maji Deodiji of Riyan (AIR 1956 Raj 12) : ILR (1955) 5 Raj 85. Aggrieved by that judgment and decree dated 14-5-58, the plaintiffs filed a second appeal which came before a learned single Judge of this Court. It was argued before him that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and that the parties mutually agree the several amounts of each and, by treating the items so agreed on the one side as discharging the items on the other side pro tanto, go on to agree that the balance only is payable. Such a transaction is in truth bilateral, and creates a new debt and a new cause of action. There are mutual promises, the one side agreeing to accept the amount of the balance of the debt as true (because there must in such cases be, at least in the end, a creditor to whom the balance is due) and to pay it, the other side agreeing the entire debt as at a certain figure and then agreeing that it has been discharged to such and such extent, so that there will be complete satisfaction on payment of the agreed balance. Hence, there is mutual consideration to support the promises on either side and to constitute the new cause of action. The account stated is accordingly binding, save that it may be reopened on any ground -- for instance, fraud or mistake -- which would justify setting aside any other agreement. It is obvious that there being no cross-Items in Ex. 1, it cannot stand the test laid down by their Lordships of the Privy Council in the above passage and hen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to a Full Bench in (AIR 1952 Raj 7 : ILR (1951) i Raj 297 FB) (supra). All the learned Judges (although two of them were not parties to the first case) again held the view that a mere acknowledgment of debt did not operate as a new contract and could not be made the basis of a suit. It could only keep alive the original cause of action and the suit must be founded on such original cause of action. The acknowledgment of debt would enure to the benefit of the creditor for the purpose of saving limitation if it is made before the original debt became barred by time. 7. In (AIR 1956 Raj 12) (supra) : this question was raised again and it was urged that the Full Bench decision of this Court in (AIR 1952 Raj 7 FB) (supra) : ILR (1951) a Raj 297 stood overruled by the decision of their Lordships of the Supreme Court in AIR 1953 SC 225 (supra). While dealing with this question, it was observed by Wanchoo C. J. of this Court, as he then was, that the decision of the Supreme Court in Heeralal's case AIR 1953 SC 225 could not be said clearly to overrule the view that a mere acknowledgment as distinguished from an acknowledgment in which there are words from which an implied promise ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... learned Judges of other High Courts, great stress is laid on the observations of their Lordships to the effect that an unqualified acknowledgment has always been held to imply a promise to pay because that is the natural inference it nothing is said to the contrary. It is what every honest man would mean to do. 10. Now, it may be pointed out that their Lordships of the Privy Council have themselves observed in Punjab Co-operative Bank Ltd. v. Commissioner of Income Tax, Lahore, AIR 1940 PC 230 that every judgment must be read as applicable to the particular facts proved or assumed to be proved, since the generality of the expressions which may be found there are not intended to be expositions of the whole law, but governed or qualified by the particular facts of the case in which such expressions are to be found . It, therefore, becomes necessary to see in what connection their Lordships made the said observation and whether it would be proper to make use of it after it is severed from its context. 11. In (1906) ILR Cal 1047 (PC) (supra), Maniram was an adopted son of one Motiram. There were regular dealings between Motiram and Seth Rupchand from July 21, 1895 to May 12, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t him. The question raised before their Lordships was whether this much admission was sufficient in Indian Law to extend the period of limitation. While dealing with this question, their Lordships referred to the provisions of Section 19 of the Indian Limitation Act, as it stood at that time, and then posed the question whether an acknowledgment of liability, if the balance on investigation should turn out to be against the person making the acknowledgment, is sufficient . While discussing this question, their Lordships referred to the following observations of Lord Justice Mellish in In re Rivers Steam Company, Mitchell's claim (1871) LR 6 Ch App 822:-- An acknowledgment to take the case out of the Statute of Limitations, must be either one from which an absolute promise to pay can be inferred, or, secondly, an unconditional promise to pay the specific debt, or, thirdly, there must be a conditional promise to pay the debt, and evidence that the condition has been performed. Thereafter, their Lordships proceeded to observe that- an unconditional acknowledgment has always been held to imply a promise to pay, because that is the natural inference, if nothing is s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to lay down that every unconditional acknowledgment which implies promise to pay, should be made the basis of the suit. It does not appear from Heeralal's case, AIR 1953 SC 225 (supra), if the views of Sulaiman, Ag. C. J., expressed in this case, were brought to the notice of their Lordships of the Supreme Court. 13. In Balkrishna v. Debsingh, AIR 1934 All 76, two other learned Judges of the same High Court agreed with the views of Sulaiman, C. J. 14. In Mt. Janaka v. Sheocharan AIR 1932 Oudh 49, Wazir Hasan, C. J. and Srivastava, J., also expressed the same opinion that, according to the Indian Law, acknowledgment does not operate as a new contract, but only keeps alive the original cause of action. 15. In Ramprasad Jagbandhoo V. Anandi Brindawan Rawat AIR 1938 Nag 180 also the observations of their Lordships made in Haniram Seth's case(1906) ILR Cal 1047 (PC) (supra) were pointed out to the Court and yet Vivian Bose, J., (who later on adorned the Supreme Court as a Judge) held the view that an acknowledgment under Section 19 of the Limitation Act cannot operate to save limitation unless it has been executed within time; 'also in such a case the suit must be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther it is a mere acknowledgment or it is more than an acknowledgment and contains an implied promise to pay will of course depend on the terms of the particular document. But assuming that it amounts to an implied promise to pay, it does not follow that they can be made the basis of a suit' and treated as giving rise to a fresh cause of action. 'If the debt had not become barred by time then even an express promise to pay it is nothing more than a promise to do what a person is, under the law, bound to do. It cannot be treated as a fresh contract or a novation of the old contract and is on no higher footing than mere acknowledgment'. On the other hand, if the debt had become barred by time, then an implied promise to pay it would be of no avail because under Section 25(3), Contract Act, it cannot be treated as a promise, made in writing, to pay a time-barred debt. When there is no express promise to pay but the intention is inferred only indirectly, it cannot be treated as a promise in writing to pay the time-barred debt The plaintiff therefore would not be entitled to take advantage of such an implied pro-raise to pay a time-barred debt. On the other hand, if there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... consideration from the side of the creditor and on account of that consideration, there is an implied promise by the debtor to pay the debt, it can, as a new agreement, form the basis of the suit. Therefore, while deciding (AIR 1956 Raj 12) (supra) : ILR (1955) 5 Raj 85, it was thought that their Lordships of the Supreme Court had perhaps disapproved this extreme view when they observed that the decision En AIR 1935 All 129 (supra), did not lay down good law. In - the absence of detailed comments of their Lordships about this case, it is extremely difficult to say which observations were considered to be laying down bad law. At any rate, their Lordships did not lay down firmly in positive terms that since an unconditional acknowledgment implies a promise to pay, it can, in every case, be made the basis of a suit. 18. In Shapoor Freedom Mazda v. Durga Prosad Chamaria, AIR 1961 SC 1236, their Lordships of the Supreme Court, after referring to Section 19 of the Indian Limitation Act and explaining its provisions, proceeded to observe that it is thus clear that acknowledgment as prescribed by Section 19 'merely renews debt; it does not create a new right of action' (un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd interest to provide relief to the poor debtors. Similar laws are In force in many other States. Even a decree obtained on an unconditional acknowledgment against the agriculturist would be of no avail to the creditor because the court will have to see all the previous accounts. Thus, so far as agriculturists are concerned, even if it be held that a suit can be based on an unconditional acknowledgment, it would not serve the creditor's purpose. Apart from agriculturists, there are a large number of poor people including labourers and if the view that a suit can be based on the unconditional acknowledgment, is held it would bring untold misery to the poor debtors. I cannot do better than to reproduce here the following observations of Weston, C. J., in Shadiram v. Prabhu:-- The whole difficulty in these matters has arisen from the importation into India considered to be required by observations of the Privy Council, particularly in Maniram v. Seth Rupchand 33 IA 165 (PC) of the rules of English Law now considered well established, namely that an unconditional acknowledgment by a debtor contains an implied promise to pay and further furnishes to the creditor a fresh caus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent in order to save limitation, that acknowledgment must have been obtained before the date of expiry of the period of limitation. If the plaintiff brings the suit on the original cause of action and seeks to extend the period of limitation on the basis of conditional or unconditional acknowledgment, he will have to show that the acknowledgment was obtained by him before the period of limitation had expired. In other words, the section itself envisages that the burden of proving that the acknowledgment was made within the period of limitation is on the creditor. Now, if it is held that a suit could be based on an unconditional acknowledgment, the creditor would be relieved of the necessity of proving that it was obtained within the period of limitation and the burden would shift to the debtor to show that it was time-barred. It would be an anomalous position that the person who brings the suit on the original cause of action will have to show even in the case of an unconditional acknowledgment that it was obtained within the period of limitation, while if he bases his suit on an unconditional acknowledgment he would be in a better position. The net result of holding that a suit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s to be computed from the date when the loan is made. Article 20 of the new Act, which corresponds to Article 58 of the old Act contemplates suits similar to the one envisaged in Article 59 when the lender has given a cheque for the money. In this case, three years' period is to be computed from the date when the cheque is paid. Article 21 of the new Act, which corresponds to Article 49 of the old Act, contemplates a suit for money lent under an agreement that it shall be payable on demand. In this case, three years' period is to be computed from the date when the loan is made. Article 22 of the new Act, which corresponds to Article 60 of the old Act, contemplates a suit for money deposited under an agreement that it shall be payable on demand. In this case, three years' period of limitation would begin to run from the date when the demand is made. Article 23 of the new Act, which corresponds to Article 61 of the old Act, envisages a suit for money payable to the plaintiff for the money paid for the defendant. Here, three years' period of limitation would run from the date when the money was paid. Article 24 of the new Act, which corresponds to Article 62 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be applied, it would again create anomalous position. If the suit is based on the original cause of action, the period from which the limitation is to run would differ from suits to suits covered by different Articles, but if the suit is based on acknowledgment, all those distinctions would disappear. The old residuary Article 120 prescribed six years' limitation whereas for a suit on a bond only three years' limitation was prescribed. It was never the intention of the law that a longer period of limitation would be available to a suitor who bases his suit on acknowledgment as compared to a suitor who files it on the original cause of action. To my mind, therefore, an acknowledgment can only serve the purpose of extending the period of limitation in favour of a suitor but it cannot form the basis of a suit. 25. In the present case, it is clear from Ex. 1 that the creditor first wrote out the balance, made the entry that the amount of ₹ 6022/- was to be obtained from the judgment-debtor and placed his signature therein. He further wrote that this balance was found according to the account given above. In fact, there was no account given above the balance. The statem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ideration that we decided (AIR 1956 Raj 12) : ILR (1955) 5 Raj 85 and I still hold that the observations of their Lordships of the Supreme Court in AIR 1953 SC 225 (supra), do not necessarily overrule the view of the Full Bench of this Court in (AIR 1952 Raj 7 FB) (supra) ILR (1951) 1 Raj 297 . 27. Learned Counsel for the appellants has referred to Brij Behari Prasad v. Bir Bahadur Rai, AIR 1968 Pat 203 in which the learned Judges of the Patna High Court have not agreed with this Court's observations in (AIR 1956 Raj 12) : ILR (1955) 5 Raj 85. With great respect, I still differ with the view they have taken. It appears that their attention was not invited to the later observations of their Lordships of the Supreme Court in AIR 1961 SC 1236 (supra), because there is no reference to them in their judgment. It cannot be said what their Lordships' opinion would have been if the said case would have been pointed out to them. 28. It was also urged that Ex. 1 amounts to an agreement and, therefore, a suit could be based thereon. It was pointed out that both the debtor and creditor appeared to have met on the day the document was executed and since the acknowledgment was bila ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... I would, therefore, allow the appeal and set aside the judgment and decree of the learned District Judge, but remand the case to the trial Court with permission to allow the plaintiffs to amend their suit so as to base it on the original cause of action and then try the case afresh. D.M. Bhandari, J. 30. Two points arise for decision in this appeal, The first is whether on the proper construction of the language of Ex. 1, it should be held that it contains an express promise to pay by the defendants 2 to 4 and the second is whether Ex. 1 could be made the basis of the suit. 31. I take the first contention first. The Khata Ex. 1 mentions at the outset that the creditors had to take ₹ 6022/- on the basis of the previous khata. This entry is signed by one of the plaintiffs Jeevraj. It is further mentioned that this balance had been struck in the presence of Kunanmal Lalchand. Then the entry is signed by the defendants Nos. 2 to 4. defendant No. 2 mentioning with his signature that ₹ 6022/- are to be paid. The argument addressed on behalf of the plaintiffs appellants is that in Ex. 1 there is not merely admission that ₹ 6022/-are due but it further contai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e property or right, or avers that the time for payment, delivery, performance or enjoyment has not yet come, or is accompanied by a refusal to pay deliver, perform or permit to enjoy, or is coupled with a claim to a set-off, or is addressed to a person other than the person entitled to the property or right. ..... Now an acknowledgment will be effective under Section 19 even if it does not contain a promise to pay whether express or implied. It will be effective even when it is accompanied by a refusal to pay or even when it is coupled with a claim to a set-off. It may be addressed to a person other than a person entitled to the property or right. An acknowledgment under Section 19 does not create any contract. It merely extends the period of limitation for a suit or application in respect of any property or right so acknowledged. It is for this reason that it is said that an acknowledgment cannot form the basis of the suit because the suit must disclose the facts constituting the basis of the claim of the plaintiff. It may, however, be mentioned that there is a specific provision in Article 64 which provides for three years' limitation from the date when the accounts a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd on the basis of such a document no suit can be filed. But a document may be bilateral in nature under which the defendant acknowledges his liability to pay a certain amount to the creditor. If such a document contains an express promise to pay, there will be little room for the contention that it cannot form the basis of the suit. We have, however, to examine a case in which there is no express promise to pay but there is an unconditional acknowledgment that a particular amount is due. There are two views possible to take in such a case. The one is that mere admission of liability does not contain even an implied promise to pay, and, therefore, it cannot be any agreement under the provisions of the Indian Contract Act. The other view is that it imports an implied promise to pay, and, therefore, it is as good an agreement under the Indian Contract Act as any other agreement, and if such an agreement is enforceable at law under the provisions of the Contract Act, a suit can be founded on it. 36. The controversy on this point took a serious turn after their Lordships of the Privy Council made the following observations in (1906) ILR 33 Cal 1047 (PC): An unconditional acknowl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctrine was recognised by two statutes, one of which required that the acknowledgment should be in writing and signed by the person chargeable, while the other made the signature of his duly authorised agent sufficient. For specialty debt the Civil Procedure Act, 1833, abolished the requirement (productive of so much litigation) that there must be an implied promise to pay; but this requirement continued to exist for simple contract debts until 1940. These statutes have all been repealed by the Limitation Act, 1939. I may further refer to the observations of Viscount Cave in Spencer v. Hemmerde (1922) 2 AC 507: My Lords, the law relating to matters of this kind is not in doubt. The statute (21, Jac. 1, c. 16, s.3) enacted that ......... all actions of debt grounded upon any lending or contract without specialty ... ...... shall be commenced and sued ...... within six years next after the cause of such actions ......... and not after, and made no reference to any acknowledgment; but it was held in a series of cases that a promise by the debtor to pay the debt, if given within six years before action brought, was sufficient to create a new contract and so to take the cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... when he makes an unconditional acknowledgment. Their Lordships of the Privy Council again reiterated the same proposition in AIR 1934 PC 144 when they tried to distinguish real account stated from a mere acknowledgment and they observed as follows: Their Lordships think that what has been forgotten is that there are two forms of account stated. An account stated may only take the form of a mere acknowledgment of a debt, and in those circumstances, though it is quite true it amounts to a promise and the existence of a debt may be inferred, that can be rebutted, and it may very well turn out that there is no real debt at all, and in those circumstances there would be no consideration and no binding promise. In the aforesaid observations, it has been laid down that a mere acknowledgment amounts to a promise. This means that there is implied promise to pay even in a mere acknowledgment. Of course such acknowledgment must be unconditional. 38. Then again in Surendra Prasad v. Gajadhar Prasad, AIR 1940 FC 10, their Lordships of the Federal Court, while construing the word 'bond' in Bihar Money-lenders (Regulation of Transactions) Act (7 of 1939) observed as follows:-- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unless it is shown that it has been made before the expiration of the prescribed period and further observed as follows: It follows that it is not sufficient for the plaintiff to merely prove the acknowledgment of liability to pay a money debt and throw the burden of showing that the acknowledgment was made beyond time on the debtor by invoking the aid of a general principle of common law that an acknowledgment necessarily implies a promise to pay it. The aid of any such principle cannot be sought to override the express provisions of the statute of limitation and be made the excuse for casting the onus of proof on the defendant. If such an indirect evasion of the law were permitted it would have the effect of nullifying the express provisions of Section 19 so far at any rate as acknowledgments of money debts are concerned. Another difficulty that was pointed out was that under Section 25 of the Contract Act, the mere implied promise to pay Involved in a mere acknowledgment would not be sufficient under Section 25 of the Contract Act and to avoid such a result, recourse must be had to reading Section 25 as if the word express were interpolated before the word promise so ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... R 33 Cal 1047 (PC) (supra) and pointed out that the decision in Pala Mal's case 119 Pun Re 1908 (supra), could not be held as good law after the decision in Maniram's case (1906) ILR 33 Cal 1047 (PC). Their Lordships also referred to a decision of the Bombay High Court in Chuni Lal Rattan Chandra Gujarathi v. Laxman Govind Dube AIR 1922 Bom 183 in which the same view was taken. 44. The Full Bench of this Court in Hasti Mal's case (AIR 1952 Raj 7 FB) (supra), has taken the view that a suit could not be founded on a mere acknowledgment as a mere acknowledgment of debt does not operate as a new contract and cannot be made a basis of the suit. For this the Full Bench relied on 1950 Raj LW 284 = (AIR 1951 Raj 74) and accepted the view of law taken in that case. 45. Now, I proceed to consider the decision of their Lordships of the Supreme Court in AIR 1953 SC 225 (supra). The suit in that case was based on the following entry in the plaintiff's books which was signed by the defendant in that case: ₹ 34000/- balance due to be received upto Bhadon Sudi 11 Smt. 2006 made by check and understanding of accounts with Hiralal's books. This was a case on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot be made the basis of suit and treated as giving rise to a fresh cause of action. We have examined the decision and we are satisfied that it does not lay down good law. 46. The question before us is how far the aforesaid observations of their Lordships of the Supreme Court overruled the view taken by the Full Bench of this Court in Hastimal's case (AIR 1952 Raj 7 FB) (supra) : ILR (1951) 1 Raj 297. On behalf of the plaintiff-appellants it is contended that the decision of their Lordships of the Supreme Court approved the observations made by their Lordships of the Privy Council in Maniram's case (1906) ILR 33 Cal 1047 (PC) (supra), that an unconditional acknowledgment implied a promise to pay and further approved the decision of the Lahore High Court in AIR 1929 Lah 264 (supra). It was further pointed out by the Supreme Court that the observations of Sulaiman C. J. in AIR 1935 All 129 (supra) that even if an acknowledgment implied a promise to pay it could not be made the basis of the suit did not lay down a good law. On behalf of the defendants-respondents it is however contended that the case before the Supreme Court was on accounts stated falling under Article 6 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... preme Court is entitled to the highest respect. Their Lordships of the Supreme Court in I. T. Commr. v. Vazir Sultan Sons, AIR 1959 SC 814 observed that: It is no doubt true that this Court was not concerned with any agency agreement in the last mentioned case (1927) 12 Tax Cas 927 and the observations made by this Court there were by way of obiter dicta. The obiter dicta of this Court, however, are entitled to considerable weight and we on our part fully endorse the same. Before corning into force of the Constitution, the view taken in some cases was that the courts in India must not depart from the long consistent course of decisions simply on the basis of a dictum or a supposed dictum of their Lordships of the Privy Council on a matter on which it was not directly necessary for their Lordships to decide in the case. Reference in this connection may be made to Anand Prakash v. Narain Das AIR 1931 All 162 (FB), but in other cases the view taken was that the decision of their Lordships of the Privy Council though it was obiter dicta was entitled to the highest respect from all the Indian Courts, and must be followed by the High Courts. Reference in this connection may be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he basis of suit is not a good law. The whole trend of the judgment is that their Lordships approved the aforesaid observations contained in the Privy Council judgment land also approved the view taken in Fateh Mohammed's case AIR 1929 Lah 264 and disapproved the law laid down in Gulam Murtuza's case, AIR 1935 All 129 50. It is mentioned in Fateh Mohammed's case, AIR 1929 Lah 264 (supra) that the plaintiff sued on the basis of a balance. The lower court dismissed the suit relying on Pala Mal's case 119 Pun Re 1908 (supra) and holding that a mere balance does not imply a promise to pay and therefore does not support a suit. What is of substance is that the view taken in Pala Mal's case 119 Pun Re 1908 was not regarded as good law in Fateh - Mohammed's case AIR 1929 Lah 264 and that the rule laid down in Mani-ram's case (1906) ILR 33 Cal 1047 (PC) that an unconditional acknowledgment implied a promise to pay was approved. Now I have pointed out that in Pala Mal's case 119 Pun Re 1908 the Lahore High Court has taken the view that mere acknowledgment could not form the basis of the suit. This view must be taken to be not laying down a good law as F ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a unilateral act and such an acknowledgment may not be sufficient to form the basis of the suit. Unless, there are bilateral acts which give rise to an agreement enforceable at law under the provisions of the Indian Contract Act, there can be no question of a unilateral transaction forming the basis of a suit For, after all, what is sought to be enforced in a Court of law is a right accruing on a breach of a term of a contract, though such contract may contain an implied promise to pay. The Indian Contract Act, however, does not require that the promise to pay to be enforceable must always be in express terms. 54. Now let me proceed to examine whether there are other unsurmountable difficulties contained in the provisions of the Indian law which stand in the way of taking this view. One such difficulty pointed out by Sulaiman Ag. C. J. in Abdul Rafiq's case, AIR 1932 All 199 (Supra) is that it will be an indirect evasion of law nullifying the express provisions of Section 19 of the Limitation Act. In my view, Section 19 is not at all nullified because Section 19 is applicable to all kinds of acknowledgments whether unilateral or bilateral or whether they are conditional or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such book or paper is left in the creditor's possession: provided that such acknowledgment does not contain any promise to pay the debt or any stipulation to pay interest or to deliver any goods or other property. It may be contended that if an unconditional acknowledgment is held to import an implied promise to pay, every unconditional acknowledgment will be an agreement under the Stamp Act. The first thing necessary for holding a document to be an acknowledgment of debt under Article 1 of the Stamp Act is that such an acknowledgment must be supplied by a debtor for furnishing the evidence of debt. Then it must be kept in view that the provisions of the Stamp Act are meant for taxing what is contained in that document and not what flows from it. In Carbolic Smoke Ball Company's case (1892) 2 QB 484, Hawkins J. observed as follows: It may be staled, however, that in considering whether a document is governed by the article or the proviso it is important to bear in mind the well settled (but often forgotten) principle that it is the document as it stands and not the bargain to which it refers, which has been made chargeable to stamp duty. As has been w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it can never be a bond unless the obligation is contained in the document itself in express terms . The same view has been taken by the other Judges. I am in respectful agreement with the view expressed in those cases. I may also refer to Narayana v. Lurudu Mareyya, AIR 1951 Mad 605 and Premsingh v. Gajrabai, in which the same view has been taken. 59. Thus from the standpoint of the Contract Act, an agreement containing an implied promise to pay may form the basis of the suit, yet for the purpose of Article 1 Schedule I of the Stamp Act, it will remain as an acknowledgment and stamped in accordance with that Article. 60. Lastly, a general argument has been addressed to us that if it is held that a suit can be based on an unconditional acknowledgment, it will operate against debtors in India who are mostly illiterate, inasmuch as the creditor will be relieved of the duty to show that the debt was within time when the acknowledgment was made. I may point out that a written acknowledgment of a debt is a common feature of mercantile transaction in this country, and there is no reason that the case of the creditor should be thrown out simply on the ground that he has based his ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . This appears to be correct and instead of a decree for ₹ 6215 as awarded by the trial Court the plaintiffs are entitled to a decree for ₹ 6022/-against the defendants Lalchand, Misrimal and Premraj. 63. In my opinion, the appeal should be allowed and the decree passed by the trial Court should be restored with this modification that instead of ₹ 6215/-. the decree should be passed for ₹ 6022/- only. The plaintiffs should get interest at 8 annas per cent. per mensem on this amount from the date of the filing of the suit instead of al 10 annas per cent per mensem as awarded by the trial Court. The parties be ordered to give and lake costs proportionately to their success and failure in all the three Courts. Vedpal Tyagi, J. 64. I perused the judgments of my Lord the Chief Justice and my learned brother Bhandari J., very carefully. I regret to express my inability to subscribe to the view of the learned Chief Justice that the Supreme Court did not lay down firmly in positive term in the case of AIR 1953 SC 225, that an unconditional acknowledgment implies promise to pay and it can be made the basis of a suit. It is true that while disapproving th ..... 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