Kainikkara Abdurahiman v. Aalukkal Yunus

# **IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT** **THE HONOURABLE MR.JUSTICE V.G.ARUN** **FRIDAY, THE 13[TH] DAY OF AUGUST 2021 / 22ND SRAVANA, 1943 OP(C) NO. 1398 OF 2018** **OS 183/2013 OF SUB COURT, TIRUR, MALAPPURAM** ## **PETITIONER/S:** KAINIKKARA ABDURAHIMAN AGED 40 YEARS BY ADVS. SRI.R.T.PRADEEP SMT.M.BINDUDAS ## **RESPONDENT/S:** AALUKKAL YUNUS BY ADVS. SRI.JAMSHEED HAFIZ SMT.T.S.SREEKUTTY THIS OP (CIVIL) HAVING COME UP FOR ADMISSION ON 06.07.2021, THE COURT ON 13.08.2021 DELIVERED THE FOLLOWING: **O.P.(C) No. 1398 of 2018** 2 ## **JUDGMENT** Dated this the 13[th] day of August **,** 2021 **The short question arising for consideration in this original petition is whether Ext.P1 is a bond or an agreement.** **2. The petitioner filed O.S.No.183 of 2013 before the Sub Court, Tirur for realisation of an amount of Rs.11,20,000/-, from the respondent, based on Ext.P1 document and a cheque dated 20.03.2013. In his written statement, the defendant/respondent contended that Ext.P1 is a bond and being insufficiently stamped, the document is liable to be impounded. Before commencement of trial, the court below considered the question as to the nature of the document. The petitioner contended that Ext.P1 is an agreement in terms of Article 5(C) of the Schedule attached to the Kerala Stamp Act, 1959 and hence, the stamp** **O.P.(C) No. 1398 of 2018** 3 **duty payable is only Rs.50. The respondent, on the other hand, contended that the document is a bond as defined under Section 2(a) of the Kerala Stamp Act. By Ext.P4 order, the document is held to be a bond. Hence, the original petition.** **3. Learned Counsel for the petitioner referred to Ext.P1 and contended that the terms and the wordings in Ext.P1 clearly reveals that it is intended to be an agreement. It is submitted that the parties themselves have termed Ext.P1 as 'an agreement' and the acknowledgement therein is of a pre-existing liability. Reliance is placed on the decision in** _**Sreedharan v. Gopi [2003 KHC 420]**_ **to contend that a document acknowledging an antecedent obligation or a pre-existing liability cannot be a bond.** **4. Learned Counsel for the respondent also referred to Ext.P1 extensively to contend that the document is a bond. Attention is also drawn to the** **O.P.(C) No. 1398 of 2018** 4 **averment in the plaint to contend that even according to the petitioner, the document is not executed in acknowledgement of any pre-existing liability.** **5. To resolve the question involved, it is necessary to carefully analysis the contents of Ext.P1 document. The English translation of the relevant portion of Ext.P1 reads as under;** **The first party has borrowed an amount of Rs.8,20,000/- from the second party for the purpose of expansion of his business. The above amount received by the first party from the second party shall be repaid within two months. In case of default by the first party in repaying the amount to the second party, the first party and his properties will be liable and the second party will be at liberty to initiate legal proceedings against the first party.** **Even though the prates have termed the document as** **O.P.(C) No. 1398 of 2018** 5 **an agreement, the wording of the document indicate otherwise. It is evident that the document was not executed in acknowledgement of any preexisting liability and on the other hand, the obligation for repayment is created under the document itself. Further, as noticed by the court below, the document is signed only by the borrower and attested by two witnesses.** **6. In** _**Sreedharan**_ **, the document was executed undertaking to pay the amount borrowed from the plaintiff earlier. In the said factual background this Court held the document therein to be an agreement. The contextually relevant portion of the judgment is extracted hereunder:** _**“3. I have perused the document. Essential ingredient which distinguishes a bond and an agreement is that in the case of bond if the implication was a pre-existing one it would not partake the character of a bond. Document which evidences acknowledgement of an antecedent obligation or a pre-existing liability it would not normally become a bond. Agreement is defined in the Indian Contract**_ **O.P.(C) No. 1398 of 2018** 6 _**Act, 1872 to mean every promise and every set of promises, forming the consideration for each other. Essential features for construing a document as a bond is that it must create an obligation to pay and no such obligation can be inferred from a mere acknowledgement of borrowers. An implied obligation cannot convert acknowledgement into bond. Real test to decide whether it is a bond or agreement is to find out after reading the document as a whole, whether an obligation is created by the document itself or whether it is merely an acknowledgement of a pre-existing liability. If there is merely an acknowledgement of a pre-existing liability which could have been enforced apart from the document itself, then the matter stands on a different footing. As far as the present case is concerned, the proper character of agreement is distinct from a bond. When the document is read as a whole it would reveal that it acknowledges preexisting liability. In such circumstances, I am of the view court below is not justified in directing the petitioner to pay deficit stamp duty the document being an agreement.”**_ **The essential difference between a bond and an agreement is that, in the case of bond, a person obliges himself to do an act mentioned therein and the instrument itself expressly creates the obligation, whereas an agreement is nothing but an union, collection, copulation and conjunction of** **O.P.(C) No. 1398 of 2018** 7 **two or more minds in anything done or to be done. Inasmuch as, there is no reference in any preexisting liability and the obligation to repay is created under the document itself, the court below was fully justified in holding Ext.P1 to be a bond.** **In the result, the original petition is** **dismissed.** **Sd/V.G.ARUN JUDGE** Scl/ 8 ## **O.P.(C) No. 1398 of 2018** ## APPENDIX EXT.P1 – TRUE COPY OF AGREEMENT DATED 14.7.2010 EXECUTED BY RESPONDENT. EXT.P2 – TRUE COPY OF PLAINT DATED 16.7.2013 IN O.S.No.183/2013 BEFORE SUB COURT, TIRUR. EXT.P3 – TRUE COPY OF WRITTEN STATEMENT DATED 18.11.2013 IN O.S.No.183/2013 BEFORE SUB COURT, TIRUR. EXT.P4 – TRUE COPY OF ORDER DATED 25.5.2018 IN O.S.No.183/2013 BY THE COURT OF SUB COURT, TIRUR.