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Prokash Chandra Kishenlal Vs. Kays Constructions Co. and anr. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtKolkata High Court
Decided On
Case NumberAppeal No. 35 of 1959
Judge
Reported inAIR1962Cal654,66CWN483
ActsTransfer of Property Act, 1882 - Section 130; ;Stamp Act - Section 40(1) - Schedule - Article 1
AppellantProkash Chandra Kishenlal
RespondentKays Constructions Co. and anr.
Appellant AdvocateS. Roy and ;Bose, Advs.
Respondent AdvocateA.M. Pal, Adv.
DispositionAppeal allowed
Cases ReferredKisen Gopal Bogree v. L.J. Bavin
Excerpt:
- .....sum of rs. 7651/9/- was due to the defendant no. 2 rohmetra and co. ltd. from the defendant no. 1 kays construction co. on account of the price of goods sold and delivered by the defendant no. 2 to the defendant no. 1. the plaintiff prokash chandra kishenlal sues to recover the debt from kays construction co. on the ground mat the plaintiff is the assignee of the debt. ray, j. held that the plaintiff is not the assignee of the debt and dismissed the suit. it appears that rohmetra and co. ltd. made out a bill dated september 21. 1956 showing that kays constructions co. was a debtor of rohmetra and co. ltd. for the price of the goods amounting to rs. 7651/9/-. the following endorsements appear on the bill:'please make the payment of this bill to messrs. parkash chand kishan lall: 55 cross.....
Judgment:

Bachawat, J.

1. This appeal is from a judgment and decree dismissing a suit for recovery of a debt The sum of Rs. 7651/9/- was due to the defendant No. 2 Rohmetra and Co. Ltd. from the defendant No. 1 Kays Construction Co. on account of the price of goods sold and delivered by the defendant No. 2 to the defendant No. 1. The plaintiff Prokash Chandra Kishenlal sues to recover the debt from Kays Construction Co. on the ground mat the plaintiff is the assignee of the debt. Ray, J. held that the plaintiff is not the assignee of the debt and dismissed the suit. It appears that Rohmetra and Co. Ltd. made out a bill dated September 21. 1956 showing that Kays Constructions Co. was a Debtor of Rohmetra and Co. Ltd. for the price of the goods amounting to Rs. 7651/9/-. The following endorsements appear on the bill:

'Please make the payment of this bill to Messrs. Parkash Chand Kishan Lall: 55 Cross Street, Calcutta. It may please be treated as irrevocable

For the Rohmetra and Co. Ltd.

P. D. Rohmetra

Managing Director.

Accepted.

For Kays Construction Co.

Sd/- Illegible

22-9-56'.

2. Subsequently by letter dated April 18, 1957 the plaintiff demanded from Kays Construction Co. payment of the amount of the bill stating that the bill had been endorsed in favour of the plaintiff. By its reply dated May 21, 1957 Kays Construction Co. promised to settle the matter quickly. By letter dated June 13, 1957 the plaintiff's attorney demanded payment stating that Rohmetra and Co. Ltd. had assigned the bill for valuable consideration to the plaintiff and that Kays Construction Co. had duly accepted the assignment in writing. Kays Construction Co. did not reply to this letter and never disputed that there was an assignment of the debt in favour of the plaintiff.

3. Now Kays Construction Co. was indebted to Rohmetra and Co. Ltd. for the sum of Rs. 7651/9/-. This debt was an actionable claim and in view of Section 130 of the Transfer of Property Act could be assigned by the creditor by an instrument in writing signed by the Creditor. The point in issue is whether the endorsement on the bill by Rohmetra and Co. Ltd. amounts to an instrument of transfer in writing. The endorsement contains a positive direction by the creditor to pay the amount of the bill to the plaintiff. The direction is expressed to be irrevocable. The paramount intention of the creditor to be gathered from the document is that henceforth the title to the debt would pass to the plaintiff. The point is emphasised by the acceptance of the debtor endorsed on the bill. We read the acceptance of the debtor as an acknowledgment of the correctness of the amount of the bill and also as an engagement to pay the amount of the bill to the plaintiff. The debtor could not thereafter discharge the debt by making payment to the original creditor Rohmetra and Co. Ltd. The debtor could discharge the debt only by making payment to the plaintiff. Reading the endorsement made by Rohmetra and Co. Ltd. in the light of the subsequent acceptance by the debtor we are satisfied that the endorsement amounted to an assignment and/or transfer of the debt. The original creditor intended to assign the amount of the debt by the endorsement and the words of the endorsement were so understood by the debtor when the debtor accepted the bill. The point is made plainer when the subsequent correspondence is looked at. The correspondence shows that the endorsement on the bill was treated by the parties as an assignment of the debt. The original creditor intended to assign the debt and the intention is well expressed in writing. There is, therefore, a good and sufficient transfer of the actionable claim in writing as required by Section 130 of the Transfer of Property Act.

4. A pay order must be distinguished from an assignment. A pay order gives the payee no interest in the fund and the liability of the debtor is still to the creditor and not to payee. But an instrument though in form a pay order may amount to an assignment and may pass the interest in the fund to the payee. Each instrument must be construed in the light of its own language and in the light of the attendant circumstances. Construing the instrument before us in that light we are satisfied that the instrument is an instrument of transfer and assignment of the actionable claim. Much reliance was placed by learned Counsel for the respondent on the decision in Kisen Gopal Bogree v. L.J. Bavin, 42 Cal LJ 43 : (AIR 1926 Cal 447). In that case the Court had occasion deal with the following endorsement on a bill:

'Messrs. Kilburn and Co., Kindly remit toBabu Kissen Gopal Bogree who will collect onour behalf.'

The Court decided that this endorsement was a revocable pay order and did not amount to an assignment of the debt. With respect I agree with the decision. Sanderson, C. J., pointed out that the endorsement meant that Kissen Gopal Bogree was not to collect the money on his own behalf but was to collect it on behalf of the original creditor. The wording of the endorsement in question before us is materially different. By this endorsement the original creditor did not direct the debtor to pay the amount of the debt to the plaintiff on behalf of the original creditor. There was an unconditional order by the original creditor to the debtor to pay the amount of the bill to the plaintiff coupled with the direction that the order would be irrevocable. The debtor accepted this order and promised to pay the debt to the plaintiff. The effect of the endorsement was that thenceforth only the plaintiff was entitled to realise the debt. Though the instrument is in form a pay order the intention to assign the debt appears plainly on the face of it.

5. The instrument was not stamped originally. But before the trial started the instrument was impounded by the Collector and the Collector acting under Section 40(1)(b) of the Indian Stamp Act collected the amount of the proper duty leviable upon the instrument on the basis that it was an assignment On September 3, 1958 the Collector endorsed a certificate on the instrument stating that the proper amount of stamp duty leviable upon the instrument had been levied under Section 40(1)(b) of the Indian Stamp Act and that the deficient stamp duty had been recovered from the plaintiff. In view of Section 42 of the Indian Stamp Act, the instrument bearing this certificate is admissible in evidence. But Mr. Pal contended that the Collector had no power to act under Section 40 of the Indian Stamp Act He argued that the instrument was an acknowledgment within the meaning of Article 1, Schedule I of the Indian Stamp Act chargeable with stamp duty of one anna and that consequently the Collector had no power to act under Section 40 of the Indian Stamp Act. We are unable to accept this contention. The endorsement of Rohmetra and Co; Ltd. on the bill is not an acknowledgement of a debt. We are primarily concerned, with this endorsement Eve the endorsement of acceptance made by the debt Kays Construction Co. does not amount to a acknowledgment within the meaning of Article (sic) Schedule I of the Indian Stamp Act. The acceptance is an engagement to pay the amount of the b(sic) The acceptance was not made solely with t(sic) object of supplying evidence of the debt.

6. No other point has been argued before us. The amount of the debt is admitted. T(sic) assignment of the debt in favour of the plaintiff (sic) sufficiently proved. It must follow, therefore, th(sic) the plaintiff is entitled to a decree as claimed (sic) the plaint We pass the following order.

7. The appeal is allowed. The judgment and decree passed by the learned trial Judge i(sic) set aside. There will be a decree in favour of the plaintiff Prokash Chandra Kishenlal against (sic) defendant Kays Construction Co. for the sum of Rs. 7,651/9/- with interim interest at the rate of 6% per annum from August 19, 1957 up to tod(sic) and interest on decree on the principal sum of Rs. 7,651/9/-. The defendant Kays Construction Co. do pay to the plaintiff Prokash Chand (sic) Kishenlal the costs of and incidental to the suit (sic) also the costs of and incidental to this appeal.

Das Gupta, J.

8. I agree.


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