P L D 1949 Lahore 448 (PLP)

SIR ABDUR RAHMAN, A. C. J.‑This is a reference by the Chief Controlling Revenue Authority, West Punjab, under section 57 of the Indian Stamp Act (II of 1899) and the short question which this ' Court has been called upon to answer is whether a cash memorandum (usually known in the market as a cash memo.) issued by a shop‑keeper to a purchaser of goods of the value exceeding Rs. 20 is liable to be stamped as a receipt? Six cash memoranda have been enclosed with the order of reference but it is unnecessary to refer to the terms of the every document. It would be useful, however, to reproduce three of these. They would help us in appreciating the contention advanced by the learner: Advocate‑General and in expressing the answer I propose give Telegrams "Foolscap" Telephone : 4258. Bought of M/s. Ram Lall Kapoor & Sons, Paper Merchants, Anarkali, Lahore. M/s. Rippon Ptg. Press, LHR. No. 652 Dated 11‑5‑1946 Qty. Particulars Rate Amount. 2 Grs. White Card. 22 x 28 28 @‑/7/10 Add 10% (Sd.) (Illegible). 13/12/6 Rs. As. Ps. 27 9 0 2 12 0 30 5 0 (Sd.) (Illegible). Purchaser E. & O. E. Manager, Bill book Taalimi Press, Circular Road, Lahore, Dated 6‑6‑1946. To Rippon Press. Lahore. Serial Name. Particulars. Rs. 'As. Ps. Remarks. No. 1 Green Flags 200 (in number) 3500 Total 3500 Received Rs. 35 only, (Sd.) A. H. KHALIL, (Sd.) A. K. Manager Cash Memo. No. 1208. Tele : "BONDPAPER." Phone No. 2769. J. B. ADVANI & Co., LTD., LAHORE. 23‑7‑

946. To M/s. Rippon Printing Press, Lahore. One Ream Col. Bristal. Boards 22 x 28 77 lbs, @ a. 13‑1 lbs. 62‑15‑0 Rs. Sixty‑two and annas Fifteen only. (Sd.) MEHR CHAND. (Sd.) (Illegible). (Seal.) Before making payment, please check the price and if through oversight, it has been charged more than the controlled price please point out to us for recti fication." In contending that a cash memorandum is in fact a receipt and liable to be stamped as such, our attention was drawn on behalf of the Crown to sub‑classes (a) and (d) of the definition of the term `receipt' in section 2 (23) of the Indian Stamp Act. The relevant words of the definition read as hereunder :‑ "23. "Receipt" includes any note, memorandum or writing :‑ (a) where by any money* * * is acknowledged to have been received, or (b) which signifies or imports any such acknowledgment, and whe ther the same is or is not signed with the name of any person." The learned Advocate‑General argues that inasmuch as these memoranda acknowledge the receipt of the money and in any case signify or import such an acknowledgment, they fall within the definition of the term and are liable to be stamped as such. The real question, therefore, decide is whether they acknowledge the receipt of money or signify or import such an acknowledgment and thereby furnish the purchasers with evidence of payment made by them for it must be admitted that if they fall into that category, they would be liable to be stamped as receipts regardless of the fact that they are also issued for the purpose of book keeping. In order to appreciate the nature of these documents, one would have to analyse as to what actually happens before these cash memo randa are issued by shop‑keepers. That would in my view enable us to determine their true character. An intending purchaser enters a shop and makes his requirement or requirements known to the shop‑keeper. Let us assume that the article or articles required by him is or are available at the shop, produced by the shop‑keeper or his agents and tile intending purchaser approves of it or them, as the case may be and agrees to pay the price demanded. The transaction is then recorded by the shop‑keeper in a book containing a number of detachable leaves with tire words 'Cash memo' printed on them and since be prepares them usually in duplicate, he gives a copy of the same to the purchaser. This is an important stage where I might pause and analyse. But that time a contract to sell has been entered into and since the transaction is in respect of ready goods which have been approved and the price for the same agreed to be paid, the property in the goods would pass on the pay ment of the price for which no facility of credit has been given or pro mised to be given. The money which is required to be paid has not 'teen, however, yet paid for more often than not, the purchaser does not know by then as to what exact amount he is required to pay particularly when he has bought several articles or when he has bought a certain quan tity of cloth or paper at a particular price per yard per ream. The shop keeper makes a record of the article or articles sold by him on his cash memo. calculates the price payable, records it on the cash memo. and presents the document to his customer. This also includes the sale‑tax of which and at all events of the exact amount of which the purchaser was in all probability still unaware. The purchaser then looks at the cash memo. and comes to know for the first time what he is being required to pay. But by that time the cash memo. has, as has already been pointed out changed hands and if it was meant to have been an acknowledgment of receipt of the payment of price or signified or imported any such acknowledgment, the purchaser would be in possession of a document evidencing payment which has been not made but which he is likely to make shortly afterwards after he has checked the price or possibly although in‑ rare cases, he may not be in a position to do so at once. Assuming that there was no mistake in the calculation, which the pur chaser had a right to point out after looking at the cash memo, he would either pay or say to the shop‑keeper that he was not in a position cc pay at once and that he would send the price, say during course of the day. If the payment is made well and good; the delivery would be made and the transaction concluded ; but in the latter case if the shop‑keeper does not know the customer or does not choose to give credit even for a short time, he would withhold the goods and tell the customer to send the price and to get them after payment has been made. This important point to bear in mind however, is that it is the payment which concludes the transaction and not the preparation or the handing over of the cash memo. to the purchaser. And this payment is independent of and subsequent to the delivery of cash memo. to the buyer. It is true that when cash memo. is bought by a servant or an agent along with the goods, the principal is satisfied that the money has been paid but that is not because the former had produced the cash memo., but because he had brought the goods with him and the cash memo. only showed the amount which had been paid for them. It is thus not the receipt of payment but only an indicator of what has been paid for. It is also true that the existence of the cash memo. would also indicate that the goods had not been bought on credit but that .is very different from saying that the cash memo., if it did not contain any actual words of receipt of payment, could be regarded to be a receipt for payment of the price or could be taken to signify or import its payment. Let me now look at the cash memo. marked "C" by me which was submitted to this Court by the Chief Controlling Revenue Authority. It contains the words "Before making payment please check the price and if through oversight, it has been charged more than the controlled price, please point out to us for rectification. "It may be that these words were put by the shop‑keeper on the cash memo. to escape from the charge that he had stated (the word 'charged' would be wrong before payment) the price in excess of the controlled price by a mistake and had thus not made an attempt to commit an offence; but I am not just now concerned with that aspect of the case. The point, however, remains that the cash memo. was delivered before payment and the price mentioned therein could be in certain circumstances rectified. Let me now look at the cash memo. (a) There is nothing in that document to indicate that the amount mentioned in the fourth column had been paid. It was argued, however, that the words 'Cash memo.' printed at the top of these documents go to suggest that the money had been paid. This again is in my view incorrect. The words 'Cash Memo.' have been apparently used in contradistinction with what may be called a credit memo. or a credit voucher. These words indicate that the transaction mentioned in that document was not meant to be completed without payment in cash or in other words, to goods were not agreed in be sold for a price which could have been paid subsequently or for which a credit, however, short, had been allowed. From what has been said it would be clear that in view of the words 'Received Rs. 35' used in the cash memo. marked (b) by me that document would be liable to be stamped as a receipt but that is only because it contains‑an acknow ledgment of receipt of money exceeding Rs.

20. It may, however, be pointed out that this was not meant to be a cash memo. but appears to be detached from what is called a 'Bill Book' and has nothing in common with the two other cash memoranda to which I have referred. One of the reasons given by the learned Chief Justice in In re : The Financial Commissioner, Burma v. The Indo‑Burma Watch Company, (I L R 12 Rang.). to hold that the document was not a receipt was that it was not address ed to any particular person and the name of the customer to whom it was given was not mentioned in the document. This may not have been, and I say so with the greatest deference, strictly accurate as in my opinion a document may still be a receipt although it does not contain the name of the person who had paid the money as long as it otherwise falls within the ambit of the definition of that term given in the Indian Stamp Act. But with the other portions of his judgment I respectfully agree and have after a careful consideration of the arguments advanced to us come to the same conclusion. For the above reasons my answer to the question referred to us in respect of cash memoranda similar to (a) and (c) is in the negative and in respect of documents similar to (b), in the affirmative. But in the circumstances I would make no order as to costs. Muhammad Sharif, J.

‑ I agree. Cornelius, J.‑

I. agree. A. H. Reference answered.