[1941] EACA 20

# COURT OF APPEAL FOR EASTERN AFRICA

### Before Sir JOSEPH SHERIDAN, C. J. (Kenya), Sir HENRY WEBB, C. J. (Tanganyika) and SIR NORMAN WHITLEY, C. J. (Uganda) $\frac{1}{2} \cdot \frac{1}{2}$

## ALI LALJI, Appellant $\mathbf{v}$ .

# IDI S/O MHEMBE, Respondent Civil Appeal No. 16 of 1941

# Appeal from decision of H. M. High Court of Tanganyika

Claim for repayment of money—Whether action for debt or for return of deposit—Limitation—Indian Limitation Act, Second Schedule, article 60— Stamp duty—Unstamped document—Evidence—Admissibility—Admission in evidence subject to payment of penalty—Stamp Ordinance (Tanganyika). sections 2(23) and 39—"Receipt"—"Acknowledgment"—"Acknowledgment containing a promise to pay the debt."—Second appeal—Appeal from decree of Tanganyika High Court in its appellate capacity—Civil Procedure Code. section 100—Appeals to the Court of Appeal Ordinance (Cap. 2), section 8(1).

Respondent sued appellant for the return of Sh. 1,116 deposited with the appellant and evidenced by a document written in Gujarati and Kiswahili. The Gujarati part meant "Idi bin Muhebe. That with us are Sh. 1,116 that are to be paid Sh. 1,116: written by Ali Lalji, date 25-9-33". The Kiswahili part meant "Idi Muhebe has deposited Sh. 1,116 to Ali Lalji that is all, Ali Lalji, date 24-9-33". This document being unstamped was admitted in evidence as a receipt on payment of the prescribed penalty. The suit was instituted on 1-10-40 and within three years of the first demand.

Held $(26-11-41)$ .—(1) That the transaction was a deposit repayable on demand. Consequently it was governed as to limitation by article 60 of the schedule to the Indian Limitation Act and the suit having been instituted within three years of the first demand was timeous.

(2) The document in question was for stamp purposes a receipt within the meaning of sections 2(23) and 39(b) of the Stamp Ordinance. Consequently it was admissible in evidence subject to payment of penalty for non-stamping.

(3) Per Webb, C. J.: That where leave to appeal against a decree of the High Court of Tanganyika in its appellate capacity in general terms the right is unfettered by the limitation contained in section 100 of the Civil Procedure Code.

Vellani for the Appellant.

Respondent absent unrepresented.

SIR JOSEPH SHERIDAN, C. J.-In this second appeal, if it be decided that the document on which the action was founded and which was found as a fact by the trial court and the High Court on appeal to be a genuine document falls, for the purpose of limitation, under Article 60 of the Limitation Act, the appeal must be dismissed unless I am able to say that the concurrent findings of fact by both courts are unreasonable on the evidence. The period of limitation fixed by that article is "three years from the time the demand is made. For money deposited under an agreement that it shall be payable on demand". If in short it be held that the transaction represents a deposit as distinct from a loan or an acknowledgment of a debt within the meaning of item I of the First Schedule to the Stamp Ordinance, 1931, the appeal must be dismissed subject as I have said to the findings of fact not being unreasonable. In considering this question of the nature of the transaction it becomes necessary to refer to s. 2(23) of the Ordinance defining "receipt". That proviso inter alia defines "receipt" as follows:-"includes any note memorandum or writing $(a)$ whereby any money or any bill of exchange or promissory note is acknowledged to have been received". This proviso is in substance the same as s. 101(1) of the English Stamp Act. 1891, which deals with receipts. Being of the opinion that the document in question is a receipt for money deposited with the appellant the provisions of s. 39(2) the Stamp Ordinance were rightly applied and the document rightly admitted in evidence on the payment of the prescribed penalty of Sh. 2 and further being of the opinion that the findings on the evidence are not unreasonable, I would dismiss the appeal.

SIR HENRY WEBB, C. J.—This action was brought by the plaintiff claiming from the defendant, an Indian shopkeeper, the return of the sum of Sh. 1,116 alleged to have been deposited with him on 24-9-33 for safe custody. In support of his claim the plaintiff relied upon a document in Gujarati and Kiswahili which he said was written by the defendant's daughter and signed by her in his name by his direction. This document is as follows: (Gujarati) "Idi bin Muhebe. That with us are Sh. 1,116 that are to be paid Sh. 1,116: Written by Ali Lalji. Date 25-9-33." (Kiswahili) "Idi Muhebe. Has deposited Sh. 1,116 to Ali Lalji. That is all. Ali Lalji, Date 24-9-33." The defendant denied the fact of the deposit and the authenticity of the document, and he further pleaded that the suit was barred by limitation. The Subordinate Court of Morogoro decided in favour of the plaintiff, and that decision was affirmed on appeal to the High Court. The matter now comes before this Court on a second appeal.

One of the grounds of appeal is that the magistrate and the learned Judge on first appeal were wrong in not holding that the document was a forgery. This involves the consideration of the question whether a second appeal, as this is, may be brought upon a question of fact. In a criminal case section 314 of the Criminal Procedure Code provides in terms that a second appeal shall lie only upon a question of law. With regard to civil cases section $100(1)$ of the Civil Procedure Code provides that, "Save where otherwise expressly provided in the body of this Code or by any other law for the time being in force an appeal shall lie to the High Court from every decree passed in appeal by any court subordinate to a High Court on any of the following grounds, namely: (a) the decision being contrary to law or to some usage having the force of law; $(b)$ the decision having failed to determine some material issue of law or usage having the force of law; (c) a substantial error or defect in the procedure provided by this Code, etc.".

If this section applies it clearly prohibits a second appeal upon a question of fact. But the Civil Procedure Code must be read and construed with reference to the Application of Laws Ordinance (Cap. 2) and by section 4 of that Ordinance it is provided that "the expressions 'High Court' and 'District Court' shall be<br>deemed to be the High Court of Tanganyika". Were it not for this express statutory definition of the meaning of High Court recourse might have been had to section 13 of the Interpretation and General Clauses Ordinance which provides that any applied Indian Act "shall be read with such formal alteration as to ..... courts ...... and otherwise as may be necessary to make the same applicable to the circumstances," and "High Court" in section 100 might have been read as referring to the Court of Appeal for Eastern Africa. But as it is, I am of opinion that section 100 has no application to the circumstances of this Territory, and that the right of appeal in civil cases is governed solely by the Appeals to the Court of Appeal Ordinance (Cap. 5), section $8(1)$ (a) of which gives a right of appeal against every decree of the High Court in the exercise of its original jurisdiction, and section $\delta(1)$ (c) a right of appeal, with the leave of the High Court, against every other decree, order, judgment, decision, or finding of the High Court. In my judgment where, as here, leave to appeal against a decree of the High Court in its appellate jurisdiction, has been given in general terms, the right is unfettered by the limitation contained in section 100 of the Civil Procedure Code. The appellant is, therefore, entitled to ask this Court to say that on the evidence given at the trial the respondent was not entitled to succeed. From the record it would appear that much more attention was given to the question of the writing of the receipt than to the ascertainment of the means whereby the respondent had acquired the sum of Sh. 1,116. He said that it "represented many years cultivation", but he does not appear to have been asked to specify how many, nor the extent of the land, nor the nature of the crops. About ten years ago, that is in 1930 or 1931, he worked for the appellant for a month at a wage of Sh. 15, but I do not know whether he was cultivator before that, or only afterwards. Prima facie I should have thought that it is extremely unlikely that a person who in or about 1931 was a turn-boy at Sh. 15 a month would have accumulated Sh. 1,116 by 1933, but then I have not seen the respondent and do not know his age. The magistrate, on the other hand, did see him and was in a far better position to decide whether his story was possibly or probably true. He must have thought that it was at all events not so improbable as to justify him in rejecting it, otherwise he would not have had to consider the authenticity of the receipt, however genuine it might appear; and on the materials available to me I cannot say that he was plainly wrong in not rejecting it. Nor can I say that he was plainly wrong in holding that the receipt was not a forgery. As regards the handwriting, I respectfully agree with the conclusions arrived at by Mr. Justice McRoberts as a result of a most careful comparison of it with specimens of the handwriting of the person who was alleged to have written the document. That, of course, is not conclusive for it might only show it to be a good imitation of her writing. But the magistrate had, in addition, the evidence of the respondent on one side and that of the appellant and his daughter on the other; he believed the former and disbelieved the latter; and, in all the circumstances, I cannot say that his conclusion was unreasonable or that there was not evidence to support it.

The document in question was unstamped, but the magistrate allowed it to be admitted in evidence under proviso (b) to section 39 of the Stamp Ordinance, 1931, which reads: "where any person from whom a stamped receipt could have been demanded has given an unstamped receipt and such receipt if stamped would be admissible in evidence against him, then such receipt shall be admitted in evidence against him on payment of a penalty of two shillings by the person tendering it". But the appellant contends that the document does not come within the protection of this proviso. Section 2 (23) says "'receipt' includes any note, memorandum or writing $(a)$ whereby any money ..... is acknowledged to have been received; or $(b)$ whereby any other movable property is acknowledged to have been received in payment of a debt; or $(c)$ whereby any debt or demand, or any part of a debt or demand, is acknowledged to have been satisfied or discharged; or $(d)$ which signifies or imports any such acknowledgment". Prima facie clause (a) would seem to include such a document as that in the present case. But the First Schedule to the Ordinance, which sets out the appropriate stamp duties for various instruments, makes a distinction between a "receipt" (stamp duty formerly 20 cents but now 10 cents), and an "acknowledgment of a debt of forty shillings or over in amount or value, written or signed by, or on behalf of a debtor in order to supply evidence of such debt in any book (other than a banker's passbook) or on a separate piece of paper when such book or papers is left in the creditor's possession; provided that such acknowledgment does not contain any promise to pay the debt. .... ". An "acknowledgment" is liable to a stamp duty of 20 cents. Counsel for the appellant argues that the document with which we are concerned is certainly an "acknowledgment" and, further, that by reason of the words "that are to be paid" appearing in the Gujarati version, it is an "acknowledgment containing a promise to pay the debt", that is to say that it is, in effect, a Promissory Note, and that in either event it is excepted from Proviso $(a)$ to section 39, which allows unstamped documents, other than those chargeable with duty of ten or twenty cents or bills of exchange or promissory notes, to be stamped under penalty.

Whatever else it may be I have no hesitation in holding that the document is not a Promissory Note, that is to say, "an unconditional promise in writing made" by one person to another signed by the maker, engaging to pay, on demand, or at a fixed or determinable future time, a sum certain to or to the order of a specified person or to bearer". (Bills of Exchange Ordinance, 1931, section 83(1).) But it is not so easy to see what was the distinction contemplated by the draftsman of the Stamp Ordinance between a "receipt" and an "acknowledgment"—the latter term, it may be remarked, is not to be found in the English Stamp Act. 1891. If "receipt" had been so defined in section 2(23) as to include only a document given in acknowledgement of the discharge of a liability the distinction would be clear; a "receipt" would indicate that the person to whom it was given had ceased to be a debtor to the giver, while an "acknowledgment" would indicate that the giver had become a debtor to the person to whom it was given; and it might have been argued that where a creditor failed to give his debtor a stamped receipt the latter should not be penalized for the fault of the former, whereas if a depositor neglected to obtain one he would have no one but himself to blame. But, in my opinion, the wording both of section $2(23)$ and of section $34(1)$ are against this construction. "Receipt" by section $2(23)$ (a), by contrast to section $2(23)$ (b), clearly covers money received whether in satisfaction of a debt or otherwise, and similarly section 34(1) which imposes the duty of giving a duly stamped receipt upon "any person receiving any money of forty shillings or over $\quad\quad\mathsf{in}\quad\quad$ amount..... or receiving in satisfaction of a debt any movable property ...... " makes the same distinction between a document acknowledging the. receipt of money and one acknowledging the receipt of movable property. And in the Schedule to the Ordinance an acknowledgment of the receipt of money on. deposit by a banker is treated as a "receipt" and not as an "acknowledgment".

In my judgment "receipt" in section 39, proviso $(b)$ should be given the same meaning as in section 2(23), even though doing so may include documents which, being admissions of the creation or existence of a liability, are chargeable with duty as "acknowledgment". I am therefore of opinion that the document in this case was rightly admitted in evidence.

On the question of limitation I am clearly of opinion that the transaction between the parties was not a loan, but that, as the Kiswahili version of the document expressly says, it was a deposit, and therefore comes under Art. 60 of Schedule II to the Indian Limitation Act, which makes the period of limitation three years from demand.

In my opinion the appeal should be dismissed.

SIR NORMAN WHITLEY, C. J.—In two admirable judgments the learned magistrate and McRoberts, J., who dismissed the first appeal, have dealt with all the relevant facts most fully and clearly and, in my opinion, the conclusions, to which they both came, are so manifestly right that there is little if anything that I can usefully add.

It seems to me that the sole question for us is whether the informal homemade document Exhibit A is a receipt for money within section $2(23)$ of the Stamp Ordinance, as the High Court held it to be or an acknowledgment of a loan or a promissory note as Mr. Vellani contends. If there be any doubt on the point, the Stamp Ordinance being a penal enactment that doubt must be resolved in favour of the subject, in this case the respondent, since he is the person penalized by any failure to stamp. On the face of it it purports to record the receipt of money on deposit to be repaid. No time for repayment being stated it must clearly be on demand. That, however, does not conclude the matter. The use of the word "deposit" does not necessarily make it a deposit for the purposes

of stamp duty and it is necessary to look into the whole of the circumstances in order to ascertain the precise nature of the transaction. The respondent, whose. evidence was accepted, stated that he deposited the money with the appellant for safe keeping since he knew him well and trusted him and was not aware of otheravailable facilities such as the Post Office Savings Bank. The wording of both the Swahili and Gujarati versions is entirely consistent with that statement. The appellant does not allege that it was a loan and the wording used is not what one would expect to find if it were a loan. Nor is there any reference to a promise such as one ordinarily finds in a promissory note.

Our Stamp Ordinance is taken from the Indian Act. In the old Indian Act section 2(23) (a) and (b) were not separated as they now are so that the concluding words "in satisfaction of a debt" might have been regarded as governing the receipt for money, thus restricting the definition to receipts for money received in satisfaction of a debt, but in the later act, as in our ordinance, they were split into $(a)$ and $(b)$ in order to make it clear that the two are disjunctive and accordingly receipt for money acknowledged to have been received is left wide and unrestricted. It is also to be observed that under the exemptions to receipts for money in Article 51 there is included under (E) a receipt for money deposited in the hands of any banker, to be accounted for.

From this it seems clear that a receipt given by a banker for money deposited with him as a banker is treated by the ordinance as falling within the definition of receipt under section $2(23)$ and furthermore it is made exempt from stamping altogether. But for the exemption it would fall under the category of receipts under section 39 (b) admissible in evidence though unstamped on payment of a penalty of Sh. 2. It is arguable whether the present case might not also come within the exemption since in my opinion the respondent in depositing his money as he did was in effect using the appellant as a banker. Whether that be so or not he was clearly entitled to demand to have a 10 cents stamp put on the receipt and accordingly as the learned magistrate held the document became admissible in evidence on payment of the two shillings penalty. That being so, there is in evidence a receipt for money deposited impliedly repayable on demand and since under Article 60 of the Limitation Ordinance time only began to run from date of first demand, the suit was not barred by limitation.

As regards the facts the case was fully argued before the magistrate and the High Court and a careful examination of the document in the light of the evidence and the two judgments I find it impossible to say that those two courts were wrong. I would dismiss the appeal with costs, if any.