1. In this suit the Raja of Gadwal sued the defendant', a resident of the Kurnool district, on ten documents, which are called Shokhas. The defendant admitted liability on one of them, Exhibit K, and disputed liability on the others. The Subordinate Judge made a decree for the plaintiff for the full amount claimed. The defendant appeals.
2. Before the Subordinate Judge in his written statement the defendant objected to the suit on the ground that Gadwal was a foreign State and that the plaintiff was suing, not to enforce a private right, but to enforce a State right arising out of liability to pay revenue due to the State. The learned Subordinate Judge did not consider at the trial the question whether Gadwal was a foreign State. He found that the right which the plaintiff was suing to enforce was a private right. When the appeal came on for hearing in this Court, the defendant raised a rather different objection, which was not set out in his appeal memorandum, namely, that Gadwal is a foreign State, but not a foreign State recognised by His Majesty the King-Emperor or the Governor-General in Council, and so the plaintiff as the ruler of that State could not sue in British India to enforce a private right, because he did not come within Section 84 of the Code of Civil Procedure. At first sight it seems not very likely that within the borders of the Indian Empire there should be a foreign State the establishment of which has not yet been recognised by His Majesty or the Governor-General in Council. But Mr. Kothandarama Ayya, who appears for the defendant, has urged that the Gadwal Samasthanam is a State not in direct relations with His Majesty or the Governor-General in Council, s but a State under the suzerainty of the Nizam of Hyderabad. It is possible that there might be a State, not itself recognised by His Majesty or the Governor-General in Council, but subject to the suzerainty of some other State within the borders of the Indian Empire which was so recognised. But it is not disputed that, if Gadwal is to be found to be such a State, we must find that at any rate some degree of sovereignty has been preserved to it. When the case came on first before Devadoss and Mackay, JJ., they thought it was necessary to inquire of the Government whether Gadwal was a State recognised by His Majesty or the Governor-General in Council for the purpose of Section 84 of the Code of Civil Procedure; and in reply to an inquiry made by the Registrar on that question a letter was received from the Chief Secretary to Government of Madras saying :
I am directed to state that the Government of India have intimated that Section 84 of the Civil Procedure; Code, 1908, does not apply to Gadwal Samasthanam in Hyderabad State.
3. It will be seen that there are various implications in that letter, but that it does not directly meet the point raised by Mr. Kothandarama Ayya. If we received through the regular official channel any intimation in regard to the relations of a foreign State with His Majesty or with the Governor-General in Council or any statement that a foreign State had or had not been recognised by His Majesty or the Governor-General in Council, I need hardly say that we should accept that intimation as conclusive. But in this case it happens that the answer to the inquiry made does not conclude the contention raised by the defendant. Having received that answer, Devadoss and Mackay, JJ., thought it well to frame an issue: 'Is Gadwal Samasthanam a foreign State' and send it to the Subordinate Judge for a finding. The Subordinate Judge after taking further evidence has submitted a finding that Gadwal Samasthanam is not a 'State' or a 'foreign State.' The defendant has raised objections to that finding and has urged before us that' Gadwal is a State, a foreign State, but not one recognised by His Majesty or the Governor-General in Council, and that therefore the plaintiff as the ruler of that State could not bring this suit in a Court in British India.
4. The position is rather curious because the defendant is trying to thrust upon the plaintiff an honour which the plaintiff does not claim. The plaintiff maintains that the Raja of Gadwal is a subject of the Nizam of Hyderabad, a subject indeed with a long and very distinguished history behind him, a subject in a very special position, a subject with special rights and privileges and exercising some of the powers usually exercised by ruling sovereigns, such as the rights of escheat and warship, the right to hold Judicial Courts, but nevertheless a subject, not a sovereign. We must remember that in many parts of the world such powers as I have just mentioned have been exercised by subjects in feudal or quasi-feudal relations with their sovereigns; but nevertheless their legal position has been that of a subject. In the circumstances of this case it does not appear necessary to me to enter into elaborate discussion of the character and essence of sovereignty. But I think it cannot be denied that any State which has preserved any degree of sovereignty and various attributes of sovereignty may have been ceded to their suzerains by different States--must have at least three characteristics. First, the people of the territory concerned must owe allegiance to the ruler of the supposed State, and in the term 'ruler' I include any person in whom, or body in which, the sovereign power resides. Secondly, the laws enforced in the State must be the ruler's laws, either made or recognised by him, not laws imposed by any outside authority, nor laws made by him in virtue only of a delegated authority. And thirdly, those laws must be enforced by his Courts, that is Courts deriving their authority from him and not subject to the judicial control of any outside authority. Mr. Kothandarama Ayya in the course of his argument referred to Federated States. What I have said in regard to the power of law-making does not relate directly to Federated States; but I do not think it is in any way in conflict with the position of a body of Federated States. A group of co-ordinate sovereign States can agree together that the whole body shall make laws which are to run in the territory of each member; but those laws are made not by any external authority but by virtue of authority derived from the sovereign members themselves.
5. If we look at the evidence regarding the laws which run in Gadwal and the judicial Courts which are established there, we shall find, I think, no difficulty in deciding the question before us. Diwan Bahadur Aravamudu Aiyangar, an Advocate of this Court, whose father was a judicial officer of the Gadwal Samasthanam and who himself had been legal adviser of the Samasthanam for nearly 30 years, has given evidence as P.W. 5. He states that the Raja of Gadwal has no legislative power ; and he has also given evidence to the effect that the Nizam's laws run in the Gadwal territory, instancing the Nizam's Criminal Procedure Code and the Nizam's Land Revenue Act. D.W. 3, a vakil called by the defendant, has stated that Gadwal is governed by the laws prevailing in the Nizam's State and that there is no independent power in the Gadwal Samasthanam to frame laws. In regard to Courts, Mr. Arava-mudu Aiyangar has stated that judicial officers in Gadwal are nominated by the Raja but not appointed by him: they are appointed by the authorities of the Nizam's State. He has also stated that for more than 30 years there has been a right of appeal from the Courts of Gadwal to the Nizam's Courts--it must be noticed, not to the Nizam as suzerain in any political or executive capacity, but to the Nizam's Courts. The defendant himself as D.W. 2 has made a similar statement regarding the position of the Gadwal Courts. I think that evidence is quite conclusive to show that the Gadwal Samasthanam is in no sense a sovereign State or a foreign State for the purpose of Section 84 of the Code of Civil Procedure.
6. Besides this objection to the maintainability of the suit, the defendant has urged a number of points in regard to the Shokhas before us. The learned Subordinate Judge has treated all the 9 Shokhas in dispute as promissory notes. But I think it is quite clear, when they are examined, that all except three of them are not promissory notes. Exhibits A, B and H do contain unconditional promises to pay for a certain consideration named that is trees assigned. But the other Shokhas except Exhibit K are offers for date trees. I think it will be convenient to deal first with the Shokhas which are promissory notes, Exhibits A, B and H. The defendant maintains that there was no consideration for these notes. But consideration is recited in them. In the ordinary way it is for him to prove want of consideration. He is a witness whose evidence does not read in a very convincing way, and the attitude he has taken up in this suit has shifted from time to time. The learned Subordinate Judge has not believed him on this point. I can see no sufficient reason why we should differ from the Subordinate Judge as regards that.
7. But apart from the question of consideration Mr. Kothandarama Ayya has urged other points. One is that the defend, ant executed these notes only as the agent of another man called Rangayya. There is nothing whatever in Exhibit A to suggest that the executant was anybody but the defendant himself or that he was acting for anybody else. Nor is there in Exhibits B and H as they appear before us. But unfortunately part of the paper on which Exhibits B and H have been written appears to have been torn or cut off just below the defendant's signature. It is suggested for the defendant that under his signature on these notes he wrote some words to indicate that he was the agent for Rangayya. It is a suspicious thing that the paper should have been torn off below the signature in these notes. An allegation was made before the Subordinate Judge that the notes had been tampered with while they were in the Subordinate Judge's Court. The clerk of the plaintiff's vakil filed an affidavit that they were not torn in that way when he put them into Court. The learned Subordinate Judge made an inquiry with the aid of affidavits into the matter but was unable to come to any conclusion. But, because the paper on which the notes were written has been torn or cut off in this way, can we accept the defendant's statement that he signed as agent for Rangayya? His own evidence in the matter is extraordinarily halting. He says :
I do not well remember if in the suit Shokhas I had written anywhere that I was Rangayya's agent. I remember in some Shokhas which I executed for him I mentioned that I was agent. Some of the suit Shokhas were in full paper when I executed them. Exhibits B, H, J and D were in fuller paper when I executed them. Below my signature in Exhibit J some letters are missing in the part found torn. The letter that appears now is 'a'; the missing word should be agent. In Exhibit D I similarly find the yethvam of Ye Rangayya.
8. Then he goes on to explain that in the other notes 'out of laziness and because plaintiff and his Abkari Superintendent were aware that I was Rangayya's agent I failed to mention in the rest that I executed them as Rangayya's agent.' But it will be seen that he does not say specifically that in the case of Exhibit B or in the case of Exhibit H he signed as agent. When we look at these notes themselves it does not appear at all probable that he did so. Each of them is headed, as indeed all these Shokhas are, 'Shokha executed by Kothakota Venkatarami Reddi,' that is the defendant. There is no suggestion there that it was executed for anybody but himself. It has also to be noticed that, when a lawyer's notice was sent to him, in his reply he said that the claim was false, but he did not say that he executed any of the Shokhas in question as agent for Rangayya. In these circumstances I think that the contention that Exhibits B and H were executed only as agent for Rangayya clearly fails.
9. Another objection taken for the defendant is that these three promissory notes are made in favour of the 'Mohathameem Sahib Garu of Gadwal Samasthanam,' that is the officer holding that post, and not in favour of any person by name. It is contended that to make a note in favour of a person described by his office is not to make it in favour of a certain person as required by Section 4 of the Negotiable Instruments Act. But in Mahant Damadar Das v. Benares Bank Ltd. (1920) 5 Pat. L.J. 536 it was decided that a promissory note made in favour of 'the manager or acting manager of the Benares Bank, Ltd.' was properly made and the person who was certainly indicated was the Benares Bank. Following that I am quite prepared to find that these promissory notes were executed in favour of the Raja of Gadwal, sufficiently described through his officer by the name of the office. It must be remembered that in this country we have the last part of Section 5 of the Negotiable Instruments Act to help us in this matter, which provides that, if it is clear to whom payment is to be made, he may be a 'certain person' within the meaning of Section 4 of the Act although he is misnamed or only designated by description. In Rama-nadkan Chetty v. Katka Velan I.L.R. (1917) M. 353 : 33 M.L.J. 627 it was held that a note drawn in favour of a trustee of a temple by name and office was really in favour of the trust and could be sued on by a successor of the trustee. In my opinion this objection also fails.
10. Another objection to these notes is that none of them is stamped, though they were all executed in the Nizam's Dominions where promissory notes must be stamped in a manner similar to the way in which they have to be stamped in British India. The result of this is that none of these three notes could have been admitted in evidence according to the Negotiable Instruments Act in force in the Nizam's Territories to prove the plaintiff's claim. It appears that there is a provision in the Negotiable Instruments Act of the Nizam's Dominions that, although other documents which have not been stamped at the time of execution may be made admissible in evidence by paying a fee or penalty, the defect of want of stamp cannot' be cured in that way in the case of promissory notes. Mr. Kothandarama Ayya suggests that the result of that is that these notes were void in the Nizam's territories. But that is not what the Act says. It merely makes them inadmissible in evidence. If they were void in the Nizam's Dominions, the place where they were made, certainly they could not be used as the basis of a suit instituted in British India. But, if they are merely inadmissible in evidence in Courts in the Nizam's Dominions because they are not stamped, it does not follow that they are inadmissible in Courts in British India. A note made in British India and unstamped would be inadmissible in our Courts; but we cannot stretch the provisions of our Negotiable Instruments Act to exclude on that basis a promissory note executed in a foreign territory. This particular point came before the Bombay High Court in Dhondiram Chatrabhuj v. Sadasuk Savatram I.L.R. (1918) B. 522 and it was there decided that a promissory note made in the Nizam's Dominions, but unstamped and so inadmissible in evidence- in any of the Nizam's Courts, could be proved in a Court in British India. That is the principle which has been adopted in England, as may be seen from Bristow v. Sequeville (1850) 5 Ex. Rep. 275 I cannot agree with Mr. Kothandarama Ayya's contention that because these promissory notes being unstamped could never have been admissible in any of the Nizam's Courts and so were practically unenforceable in his territory they must be regarded as void. That is not, so far as I can see, the effect of the penalty imposed in the Nizam's territory for failure to stamp them.
11. So far in regard to Exhibits A, B and H. There remain the other six Shokhas. These are, as I have said, in the form of applications for date trees, apparently required for the purpose of drawing toddy. They are offers for date trees and promises to pay certain amounts in certain periods. For the defendant it is contended that they are mere offers, that, though on the back of each paper there is an endorsement saying that it was accepted, no such acceptance was ever communicated to the defendant and that therefore he is not bound by the documents at all. On the other hand, Mr. Venkatachariar for the plaintiff contends that there is evidence that the right to tap date trees was given in consequence of these applications to the defendant's knowledge and therefore there was acceptance by performance and he got consideration for these documents and is bound by them. All these six documents refer to date trees required for the 'Rajavole mamla Savukattu,' which we are told means trees required for the toddy-tapping lease in the Rajavole village. There is the evidence given by P.W. 4, which combined with that of D.W. 1 shows sufficiently, I think, that the lease of trees for toddy tapping in the Rajavole village for Fasli 1329 was granted to Rangayya and a man called Thimma Reddi, who is a brother of the defendant. If the defendant applied for trees for the purpose of that lease and the lease was granted to Rangayya and Thimma Reddi, we can hardly suppose that the defendant was not aware of that. I think that the defendant must be held liable on any of these six Shokhas I am now discussing which can be shown to relate distinctly to the lease of trees in Rajavole for Fasli 1329. Exhibits D, E, F and G by their dates must refer to trees required for that Fasli. Ex. C is dated the 19th of November, 1920, that is about a fortnight after the expiry of the Fasli, and Exhibit J is dated 13th October, 1920, about 16 days before the end of Fasli. It is obvious that Exhibit C cannot refer to Fasli 1329 at all; nor can we reasonably suppose that Exhibit J refers to trees required for that Fasli, as it is a promise to pay Rs. 1,125 for a very large number of trees, which could be used only for a few days if it were for Fasli 1329. Exhibits C and J must, I think, refer to the succeeding Fasli, and we cannot find from the evidence who got the lease for that Fasli. Possibly the defendant himself was applying for it; but there is no evidence who got the lease. I think therefore that we cannot say that the offer made in Exhibit C or the offer made in Exhibit J was accepted to the knowledge of the defendant or that trees were let in accordance with them, and therefore the plaintiff's claim in respect of these two documents must be dismissed. Of the remaining Shokhas Exhibits D, E, F and G, Exhibit D is torn in a manner similar to Exhibits B and H, and the defendant takes advantage of that to urge that he only acted as an agent in connection with Exhibit D. But that contention, I think, fails, as it did in respect of Exhibits B and H.
12. In my opinion, therefore, this appeal should be allowed in respect of the amounts c6ncerned in Exhibits C and J, but in other respects should be dismissed and in the circumstances the parties should pay and receive proportionate costs throughout.
Kumaraswami Sastri, J.
13. I agree.