R. Ratilal & Co. Vs. National
Security Assurance Co. Ltd.  INSC 254 (16 December 1963)
16/12/1963 SARKAR, A.K.
CITATION: 1964 AIR 1396 1964 SCR (5)1047
Indian Stamp Act (II of 1899), s. 35, Sch. 1
Art. 47-Unstamped letter of cover of fire insurance-If and when admissible in
The appellant filed a suit on a duly
completed policy of fire insurance and an unstamped letter of cover in respect
of the same kind of insurance, issued by the respondent, to recover from it the
loss suffered as a result of the destruction of the insured goods by fire. The
respondent admitted liability on the policy but with regard to the letter of
cover it contended that the letter was not admissible evidence for want of
Held : Per Sarkar and Shah JJ. (i) A letter
of cover no doubt contains a contract of insurance but it is not a policy of
insurance and cannot be admitted in evidence as such under s. 35 of the Stamp
The Citizens Insurance Co. of Canada v.
William Parsons, 7 A.C. 96.
(ii) The proper construction of the General
Exemption in Art. 47 of schedule 1 of the Stamp Act is that a letter of cover
is not exempt from duty only when it is used for compelling the delivery of the
policy mentioned in it. If it is used for any other purpose it is not exempted.
When it is not so exempt it is an instrument chargeable with duty under s. 3 of
the Stamp Act and admissible 1048 on evidence on payment of the requisite duty
and penalty under 35 of the Act.
Per Raghubar Dayal J. (dissenting):Section 35
contemplates letters of cover to bear the necessary stamp at the time of
execution and that any subsequent affixing of requisite stamp on an unstamped
letter of cover will not make it a document which can be used for any purpose
including the basing of a claim. Theproviso to the General Exception cannot be
construed to mean that subsequent to the execution of a letter of cover
anyplace standing to gain thereby may just put the requisite stamp on it and thereafter
use it for enforcing any claim for any purpose.
Narayanan Chettiar v. Karuppathan, I.L.R. 3
CIVIL APPELLATE JURISDICTION : Civil Appeal
No. 382 of 1961.
Appeal from the judgment and decree dated May
24, 1960, of the Calcutta High Court in Appeal from Original Decree No. 144 of
B.K. Bhattachargee, D.K. De and S.N.
Mukherjee, for the appellant.
N.C. Chatterjee and D.N. Mukherjee, for the
December 16, 1963. The Judgment of A.K.
Sarkar and J.C.
Shah JJ. was delivered by Sarkar, J. Raghubar
delivered a dissenting Opinion.
SARKAR J.-The appellant filed a suit in the
Original Side of the High Court at Calcutta on a duly completed policy of fire
insurance dated March 15, 1951 and bearing No. 26625, and an unstamped letter
of cover dated November 5, 1951 in respect of the same kind of insurance issued
by the respondent, to recover from it the loss suffered as a result of the
destruction of the insured goods by fire. The respondent admitted liability on
policy No. 26625 but with regard to the letter of cover it contended that the
letter was not admissible in evidence for want of stamp. As it did not contest
liability on that letter on any other ground nor on the policy, the only
question in this appeal is whether the letter of cover can be admitted in
evidence. That question depends on some of the provisions of the Stamp Act,
1899, to which reference will be made in due course.
1049 The letter of cover which bore the
description 'Interim Protection Note' provided. that the appellant
"Proposing to effect insurance against fire and having agreed to pay
Tariff Premium thereon, the property is hereby held insured to the extent of
Rs.1,00,000 in the manner, specified below." Then followed a description
of the goods and the statement that the risks to be covered were to be as per
the said policy No. 26625 for twelve months from November 5, 1951. Thereafter
it was stated,, "The protection is in force for thirty days or until the
Company's Policy is prepared unless the Insurance is declined". The fire
on which the claim is based, occurred on the night of November 5, 1951 or
during the early hours of the morning of the next day. It is not in dispute
that the appellant offered to pay all premium due on the letter of cover.
It will be useful at this stage to refer to
two of the provisions of the Stamp Act and they are s. 35 and Art. 47 in
Schedule 1. Section 35 provides,' "No instrument chargeable with duty
shall be admitted in evidence for any purpose unless such instrument is duly
stamped: Provided that--(a) any such instrument not being an instrument
chargeable with a duty not exceeding ten naye paise only, or a bill of exchange
or promissory note, shall, subject to all just exceptions, be admitted in
evidence on payment of the duty with which the same is chargeable together with
a penalty of There is no dispute that the letter of cover is an
"instrument". Schedule 1 of the Act specifies the duties payable on
various instruments. Article 47 of the Schedule specifies the duties chargeable
on various kinds of policies of insurance. Section B of this article deals with
fire insurance policies and specifies various duties as payable in respect of
various kinds of policies of fire insurance for diverse amounts, the minimum
duty chargeable on a policy of insurances under this article being fifty naye
paise: Now this article contains at the end a general exemption which is in
1050 "GENERAL EXEMPTION.
Letter of cover or engagement to issue a
policy of insurance: Provided that, unless such letter or engagement bears the
stamp prescribed by this Act for such policy, nothing shall be claimable there under,
nor shall it be available for any purpose, except to compel the delivery of the
policy therein mentioned." It seems to us clear that the words 'such
policy' in the proviso to the General Exemption in Art. 47 refer to the kind of
policy with which a letter of over or engagement to issue a policy mentioned in
the first part of the exemption, is concerned. In the present case, therefore,
the words "such policy" would indicate a policy of fire insurance.
This does not appear to be disputed.
It was said on behalf of the appellant that
the letter of cover was really a policy of insurance and would be admissible in
evidence on payment of the duty chargeable on a policy of fire insurance and
penalty under the provisions of s. 35 proviso (a) of the Act. It was next said
that even if it was not a policy of insurance but a letter of cover only, it
would still be admissible in evidence under that section as an instrument
chargeable with duty as it was neither a bill of exchange nor a promissory note
nor an instrument chargeable with duty not exceeding ten naye paise.
The learned trial Judge held that the
instrument was not a letter of cover but it was in reality a policy of
insurance because it contained a contract of insurance. It is not in dispute
that if this view is correct, then on payment of the duty and the penalty the
instrument would be admissible in evidence under s. 35. The Appellate Bench of.
the High Court, however, was unable to accept the view of the learned trial
Judge and, we think, in this the Appellate Bench was right. The fact that a
letter of cover contains a contract of insurance cannot make it a policy of
insurance. As the learned Judges of the Appellate Bench rightly pointed out,
the letter of 1051 cover was granted a general exemption from the liability to
the duty specified in Art. 47, that is to say, it was exempted from duty which
would, but for such exemption, have been payable on it under that article. Now
under Art. 47 duty was payable on various policies of insurance. It would
follow that a letter of cover would have been liable to duty as a policy of
insurance if the exemption had not been granted. The letter of cover had,
therefore, to contain a contract of insurance for it would not otherwise have
been liable to duty under Art. 47. But it did not thereby become a policy of
insurance only for then the exemption and the article would have been in
conflict with each other. We may also mention that the word 'cover' itself
indicates that property is held insured or covered by it against certain risks.
What then is a letter of cover ? How is it to
be distinguished from a policy of insurance? The Act contains no definition of
it or of an 'engagement to issue a policy of insurance'. but the terms are well
known in trade. The Act is dealing with businessmen and with mercantile
documents well known to them. It may be shortly stated that a letter of cover
no doubt contains a contract of insurance but it is not a policy of insurance
in the common understanding of that word in the trade. It is well known that in
order to obtain an insurance against the risk of fire the assured has first to
send a proposal to the insurer and then the insurer takes a little time in
making enquiries as to whether it would accept the proposal and undertake the
obligation of covering the risk. He issues a policy only after he is satisfied
that it would be a prudent business proposition to do so. Experience of trades
people has however shown that some kind of protection for the interim period
when the insurer is making, the enquiries is necessary. This protection is
given by what is called a 'letter of cover'. It is expressly a contract granting
insurance for the period between its date and until a policy is prepared and
delivered if one is eventually issued or otherwise upto a date mentioned in it,
just as a period of thirty days is mentioned in the Interim 1052 Protection
Note issued in this case: see The Citizens Insurance Co. of Canada v. William
Parsons(1). We think that the present Interim Protection Note satisfies the
conditions which would make it a letter of cover in this sense. It gives
protection for a period of thirty days or the period upto the date of the issue
of the policy. An engagement to issue a policy means, it seems to us, more or
less the same thing as a letter of cover. A letter of cover, therefore, cannot
be admitted in evidence under s. 35 as a policy of insurance.
The next question is whether a letter of
cover is itself an instrument chargeable with duty under the Act. It is not
disputed that if it is not so chargeable, it cannot be admitted in evidence
under s. 35 by subsequent payment of duty and penalty. Now s. 3 specifies
instruments which are chargeable with duty under the Act. It says,
"Subject to the provisions of this Act and the exemptions contained in
Schedule 1, the following instruments shall be chargeable with duty of the
amount indicated in that Schedule as the proper duty there for respectively,
that is to say,-(a) every instrument mentioned in that Schedule
which..................... is executed in India on or after the first day of
July 1899". July 1, 1899 is the date on which the Act came into force.
Now the contention of the respondent is that
a letter of cover is not an instrument chargeable with duty because the General
Exemption in Art. 47 of the Schedule exempts it from such duty. This contention
was accepted by the learned Judges of the Appellate Bench of the High Court who
pointed out. "It is significant that the words used are not that such
letter is chargeable with duty. The words used are 'bears the stamp prescribed
by the Act for such policy'. On a proper interpretation this means that such letter
of cover is not chargeable with duty as such under the Act but if it bears the
stamp prescribed by the Act for a policy of insurance, then it will shed its
inability and will become a competent document on which a claim for loss could
be made." (1) 7 C. 96.
1053 They further observed, "as no stamp
is fixed for such a letter of cover being not a document chargeable with duty,
the statute uses the significant words or 'bearing the stamp' and indicates the
rate by saying that the stamp must be the same for such a letter of cover which
is prescribed for a policy of insurance under the Act"'. In this Court Mr.
Chatterjee for the respondent also advanced the same argument.
We are unable to accept the view which found
favour with the Appellate Bench of the High Court. The matter was put in two
ways. The first was that an instrument which is exempted from duty by Schedule
1 is not chargeable with duty under s. 3 and a letter of cover is so expressly
No doubt, if an instrument is exempted by the
Schedule from duty, then it cannot be chargeable. But we do not think that a
letter of cover is for all purposes exempted from duty by the General
Exemption. We think the proper construction of the General Exemption clause is
that the exemption is to apply only if the letter of cover is used for
compelling the delivery of the policy mentioned in it.
If it is used for any other purpose, then it
is not exempted. That is why a proviso has been employed in the provision and
the effect of that is to take the letter of cover out of the exemption in all
other cases. If it is taken out of the exemption, then, of course, the present
argument fails. We are unable to see how a letter of cover can be said to have
been exempted for all purposes, if certain things cannot be claimed under it
for the sole reason that it does not bear a stamp. If it were exempted for all
purposes, it would be fully enforceable even without a stamp. When a letter of
cover is not stamped, then nothing is claimable under it except the delivery of
a policy. If, however, it bears the stamp prescribed for the appropriate
policy, a claim can be made under it. It seems to us that if an instrument
bears a stamp, it has incurred the liability for the stamp duty; it has not
then been exempted. Therefore it cannot be said that a letter of cover is
exempted from duty in all cases. When 1054 it is not exempted, it is an
instrument chargeable to duty.
The other way in which the contention was put
is based on the use of the words 'bears the stamp prescribed by this Act'. It
was said that if an instrument is made to bear a stamp, it is not thereby made
chargeable to stamp duty. We are wholly unable to see how an instrument can
bear a stamp prescribed by the Act unless it is chargeable to duty under the
Act for the Act deals only with instruments chargeable to duty under it. It is
difficult to appreciate the argument that what the proviso meant by the use of
the words 'bears the stamp prescribed by this Act for such policy' was only to
indicate the amount of the duty. No doubt the rate is there, but the instrument
has to bear a stamp of that rate. The Act nowhere says anything as to how an
instrument is to bear a stamp. Section 17 says that all instruments chargeable
with duty shall be stamped before or at the time of execution. If the letter of
cover was not chargeable to duty but has only to bear a stamp as the respondent
contends, s. 17 would not apply to it. There would then be no provision to
prevent an instrument which is not chargeable to duty but is required to bear a
certain stamp, from having that stamp affixed to it at any point of time.
The result would then be that where an
instrument has only to bear a stamp, the stamp can be affixed even at the
hearing before the instrument is tendered. That, of course, would not assist
the respondent at all and would, in our view, introduce an anomaly in the Act
which would be the result of putting an unnatural construction on the words
'bears the stamp'. We think that by the use of the words 'bears the stamp' the
legislature intended to convey that a letter of cover would be chargeable to
duty in all cases except for compelling delivery of a policy.
A letter of cover is, in our opinion,
therefore, an instrument chargeable to duty under the Act and so admissible in
evidence on payment of the requisite duty and penalty under s. 35 of the Stamp
Act as 1055 it is neither an instrument chargeable to duty not exceeding ten
naye paise nor a bill of exchange or a promissory note:
It seems to us, though we do not base our
judgment on it, that the idea of exempting a letter of cover from payment of
duty in the first instance was to avoid the hardship of payment of duty twice
over on the same insurance, for the policy issued after the letter of cover had
to insure the goods from the time that the letter of cover itself insured them
and the policy had to be stamped. If the policy insured the goods from a date
after the expiry of the insurance by the letter of cover, the latter would then
be an independent policy of insurance, may be for a shorter time; it would not
then be an interim cover and, therefore, not a letter of cover at all. It may
also be stated that in very few cases it would be necessary to enforce the
letter of cover as an insurance for it is unlikely that in many cases the fire
would have occurred during the period covered by it.
We have now to state that the appellant had
paid the duty and penalty as required by s. 35. There is no objection any more
to the admissibility of the letter of cover in evidence. The only defence that
was taken by the respondent to the claim of the appellant, therefore, fails and
the appeal should succeed.
We wish, however , to observe that we have in
this judgment dealt only with a letter of cover concerning fire insurance and
our remarks on the interpretation of the proviso in the General Exemption in
Art. 47 of Schedule 1 to the Act have been made in that context only. Whether
those remarks would apply in the case of a letter of cover concerning other
varieties of insurance was not a matter for our consideration and on that
question we have expressed no opinion.
We would for these reasons allow the appeal
and pass a decree in favour of the plaintiff-appellant for Rs. 93,628/81and
costs with interest thereon from the date of the' judgment of the learned trial
Judge at six per cent.
1056 RAGHUBAR DAYAL J.-I agree that the
interim protection note does not amount to a policy of insurance and that it is
a letter of cover or engagement to issue a policy of insurance. I do not agree
that it can be subsequently stamped in view of the proviso (a) to s. 35 of the
Indian Stamp Act, hereinafter called the Act.
The interim protection note, being a letter
of cover, is exempted from stamp duty under the general exception to art.
47 of Schedule 1 of the Act. it can be used
to base a claim, or for any other purpose, only if it bears the stamp
prescribed by the Act for the policy which is to be issued in pursuance of the
letter of cover. The trial Court admitted this letter of cover on the
appellant's paying the requisite duty and penalty under s. 35 of the Act. The
High Court has held that this could not be done as the provisions of s. 35 of
the Act were not applicable to documents which were not chargeable with duty
under the Act. The correctness of this view is challenged for the appellant.
The general exception, together with the
"Letter of cover or engagement to issue
a policy of insurance:
Provided that, unless such letter or engagement
bears the stamp prescribed by this Act for such policy, nothing shall be
claimable there under, nor shall it be available for any purpose, except to
compel the delivery of the policy therein mentioned." Section 35 of the
Act, omitting the provisos other than (a), reads:
"No instrument chargeable with duty
shall be admitted in evidence for any purpose by any person having by law or
consent of parties authority to receive evidence, or shall be acted upon,
registered or authenticated by any such person or by public officer, unless
such instrument is duly stamped:
1057 Provided that(a) any such instrument not
being an instrument chargeable with a duty not exceeding ten. naye paise only,
or a bill of exchange or promissory note, shall, subject to all just
exceptions, be admitted in evidence on payment of the duty with which the same
is chargeable, or in the case of an instrument insufficiently stamped, of the
amount required to make up such duty, together with a penalty of five rupees,
or, when ten times the amount of the proper duty or deficient portion thereof
exceeds five rupees of a sum equal to ten times such duty or portion;" It
is clear that an unstamped letter of cover or engagement to issue a policy of
insurance can be used only for compelling the delivery of the policy therein
mentioned, and can neither be used for any other purpose nor can any claim be
based on it. A claim can be based on it if it bears the stamp prescribed by the
Act for the policy contemplated by the letter of cover or engagement. The
question then is whether the proviso contemplates the letter of cover to bear
the stamp prescribed for the policy at the time it is executed or can take in a
letter of cover which is not so stamped at the time of its execution but is
subsequently stamped by any person interested in stamping it or under any
orders under the Act. I am of opinion that it contemplates letter of cover to
bear the necessary stamp at the time of execution and that any subsequent
affixing of requisite stamps on an unstamped letter of cover will not make it a
document which can be used for any purpose including the basing of a claim.
The various provisions of the Act provide for
the subsequent stamping of the document only when that document is chargeable
with duty, under the provisions of s. 3 of the Act. The Act does not, ,and
naturally, could not have dealt with orders for subsequent stamping of
documents which at the time of execution are not liable to stamp duty. They
I/SCI/64-67 1058 are good valid documents without any stamp duty and therefore
no question can arise in future about ,.their being stamped under the orders of
Court or a public officer.
There is no such provision either ,in the
Act, though a number of sections deal with the subsequent charging of the
deficit duty and penalty as well. No penalty can be contemplated on account of
a document being not stamped when it required no stamp under the provisions of
the Act and was therefore not chargeable with stamp duty.
It is pertinently remarked in. Narayanan
Chetti v. Karuppathan (1) :
"It appears to me that the levy of a
penalty authorized under the proviso, on the admission of an insufficiently
stamped document, implies, a punishment for neglect in failing to affix the
proper stamp at the time of execution...... The levy of a penalty shows that
the date of execution is that which is regarded in the use of the word
'chargeable', and that chargeable therefore, means not chargeable under the Act
of 1879, but chargeable under the Act in force at the date of execution."
The view expressed in this case was affirmed by the Full Bench in a reference
from the Board of Revenue to the Madras High Court under s. 46 of the ACt(2).
The provisions of s. 35 apply to such
instruments which were chargeable with duty. Such instruments, if not properly
stamped, were not to be admitted in evidence for any purpose, nor could they be
acted upon, registered or authenticated by any person or ,by any public
Certain instruments which are not duly
stamped can be admitted in evidence if they fall under any of the provisos of
the section. The provisions of this section will not apply to instruments which
are not chargeable with duty.
'Chargeable', according to s. 2(6), means
'chargeable' as applied to an instrument executed or first executed after the
commencement of the Act, chargeable (1) I.L.R. 3 Mad. 251, 253.
(2) I.L.R. 5 Mad. 394.
1059 under the Act and as applied to any
other instrument, chargeable under the law in force in India when such
instrument was executed or, where several' persons executed the instrument at
different times, first executed. The expression 'chargeable under theAct'
indicates that the chargeability would be the ultimate result of the various
provisions of the Act.
Section 3 of the Act provides that subject to
the provisions of the Act and the exemptions contained in Schedule 1, the
instruments mentioned within its clauses (a), ( b) and (c) would be chargeable
with duty of the amount indicated in that Schedule as the proper duty therefor.
This means that instruments which are exempted under any provision of the Act
cannot be said to be chargeable with duty even though in the absence of the
exemptions those instruments would have fallen under any of the articles of
Schedule 1. A policy of insurance is chargeable with duty under Art. 47 of
Schedule 1, but a letter of cover is not chargeable with duty in view of the
general exemption to this article. It follows that the letter of cover is a
document which, as such, is not chargeable with duty.
A document chargeable with duty and executed
by any Person in India is to be stamped before or at the time of execution :
vide s. 17. If the letter of cover is intended by either the insured or the
person offering to make an insurance to be used for making a claim there under
and therefore to be treated as a policy, it is incumbent on that person to have
the letter of cover properly stamped with the requisite stamp for that policy.
If they do not so intend and desire the letter of cover to remain as a letter
of cover on the basis of which only the delivery of the policy mentioned
therein can be enforced, they may take the advantage of the general exception
and need not stamp it. The decision to stamp it or not to stamp it is to be
taken at the time when it is to be executed. If it is not then stamped, it is a
mere letter of cover which requires no stamp duty. It is a valid and 1060
complete document. No provision of the Act for its being stamped subsequently
either by any of the parties to it or by any public servant exists. The
provision in the proviso to the general exception about the letter of cover
being used to found a claim or for any other purpose when it bears the stamp
prescribed by the Act for such, policy, cannot be construed to mean that
subsequent to its execution any party standing to gain thereby may just put the
requisite stamp on it and thereafter use it for enforcing any claim or for any
purpose. Such a construction of the proviso would be against public policy and
may defeat one of the objects of the Act. It is true that the Act is a revenue
measure, but at the same time the stamping of documents gives a certain
formality to the transaction and to the preparation of the document. The letter
of cover is exempted from stamp duty because as unstamped it cannot be used for
any purpose except for enforcing delivery of the policy. If subsequent stamping
of such document, in order to convert the letter of cover into a real policy,
be left at the sweet will of the party standing to gain on account of the
uncertain event having occurred, it would be against public policy because
thereby a party who is sure to gain by fixing the requisite stamp, whose value
is bound to be negligible compared to the monetary gain it stands to gain, will
not mind the fixing of the necessary stamp and parties in general would like to
avoid payment of the stamp duty in the first instance when the document is
executed. Further, the letter of cover is issued by the insurer and, on the
happening of the uncertain event, it would be the person insuring who would
like to affix the requisite stamp and thereafter claim the amount of damages
incurred within the limits of the policy. The executant of the letter of cover
may thus be forced to abide by the terms of the document as a policy when he,
at the time of executing the document, did not intend to be so bound. When a
letter of cover is not stamped at the time of execution, both the parties stand
to lose what they are to gain monetarily on its basis. The person insuring
stands to lose the 1061 recovery of any loss he may incur prior to the issue of
the policy. The insurer-company stands to lose the recovery of the premium for
the limited period, i.e., the period between the date of the cover note and the
date when loss occurs to the proposer. Both the parties take risk of loss by
not stamping the letter of cover and thus not making it a document on which the
claim other than the delivery of the policy can be based.
In this connection, reference may be made to
s. 47 of the Act which provides for a subsequent stamping of certain documents
in certain circumstances. But this too deals with certain documents which,
though chargeable with duty, are not covered by proviso (a) to s. 35.
Section 62(1)(b) makes it penal to execute or
sign otherwise than as a witness, any instrument chargeable with duty and not included
in cl. (a), without it being duly stamped. Any subsequent stamping of a letter
of cover with the requisite stamp would lead to the parties avoiding the
penalty prescribed by s. 62(1)(b), as the letter of cover is not chargeable
with duty and the subsequent stamping would mean that it becomes a policy of
insurance, a document which could be enforced on account of being properly
Section 29 provides that in the absence of an
agreement to the contrary, the expenses of providing the appropriate stamp
shall be borne in the case of a policy of fire-insurance by the person issuing
the policy. Though there is no definite provision in the Act as to who should
stamp the document, in view of the provisions of s. 62, the person to suffer
for non-stamping a document chargeable with duty is the executants. The insurer
will not like to stamp the letter of cover subsequently and specially when the
uncertain event had taken place. Subsequent stamping by the assured in such
circumstances, could not have been contemplated by the Legislature.
Further, in view of the proviso to the
general exception to art. 47, nothing could be claimed under 1062 an unstamped
letter of cover. This means that no suit can be-instituted for the recovery of
any amount alleged to be due to the plaintiff. When the suit itself cannot be
instituted, no question of taking action under s. 35(a) of the Act can arise ,
as that action is to be taken subsequent to the institution of the suit and at
the time of admitting the document in evidence.
It is suggested for the appellant that the
provisions of the general exception indicate that the letter of cover was
exempted from stamp duty as the Legislature did not intend that the stamp duty
be paid twice over, once on the letter of cover and a second time when the
policy was issued. If the Legislature had really intended so, it could have
simply provided that if a letter of cover bears the requisite stamp, the policy
need not be stamped. The Legislature, however, spoke differently. It exempted the
letter of cover and provided that a letter of cover without stamp could be used
only for enforcing the delivery of the policy mentioned therein. The object
behind the exemption therefore appears to be the very limited purpose for which
the letter of cover can be used. The Legislature was aware of a letter of cover
usually containing material which would make it a policy for a limited period
and therefore further provided that it can be used to found a claim or for any
other purpose if it bears the requisite stamp for a policy. The reasonable
inference is that the Legislature left it to the discretion of the parties
concerned to have the letter of cover stamped or not according to the use they
intended to make of it, and therefore it would be wrong to construe the
provision to the effect that any subsequent stamping of the document in any
circumstance would change the nature of the document and make it available for
purposes for which it was not intended to be used at the time of execution.
Reliance has been placed for the appellant on
the case reported as Tricamji Damji & Co. v. Virji Kanji (1).
(1)  24. B.L.R. 820.
1063 In that case the plaintiff had claimed
damages on the bases of an unstamped protection note with respect to a contract
of sea-insurance. Marten J., held that the expression 'unless such letter or
engagement bears the stamp prescribed by this Act for such policy' in. the
general exception to art. 47 meant affixation of the stamp before or at the
time of execution, as provided by s. 17 and that s. 35(a ) must be read subject
to the express direction in the proviso to the general exception in art. 47.
His view was not accepted, wrongly I think, by the Appellate Bench, which held
the protection note to be a policy which could be received in evidence after
necessary action under s. 35 of the Act is taken. We have already held the
protection note in the present suit to be not a policy.
I am therefore of the opinion that the High
Court was right in holding that the interim protection note, not properly
stamped as a policy at the time of its execution, cannot be subsequently
stamped with the requisite stamps in pursuance of the provisions of s. 35(a) of
the Act and that the appellant cannot base his claim on the interim protection
note in suit. I would, accordingly, dismiss the appeal with costs of this Court
and the High Court and modify the decree of the High Court to the effect that
the suit for Rs. 93,628-8-0 be dismissed with proportionate costs in the trial
ORDER In accordance with the opinion 'of the
majority the appeal is allowed, decree in favour of the plaintiff, appellant
for Rs. 93,628/8/is passed, and costs with interest thereon from the date of
the judgment of the learned trial judge at six per cent.