Judgment :- 1. This Court on 11-8-1997 made the following Order:- “Admit on the question whether Ex.A.2 is a valid promissory note or not?” 2. Sri Ravindranath Reddy, the learned Counsel representing the appellant-defendant had further pointed out to the following substantial questions of law which are specified as hereunder:- 1) Whether the document can be treated as a Promissory Note and whether it is enforceable in law – when no revenue stamps are affixed underneath the said document as per the provisions of Stamp Act? 2) Whether a transfer endorsement (Ex.A.1) receiving the consideration can be treated as a Promissory Note as held by Appellate Court? 3) Whether it is not mandatory on the part of the plaintiff (alleged holder-in-due-course) to prove that a document (Ex.A.2) alleged to have been transferred to him, is a promissory note and it is enforceable and the transfer endorsement (Ex.A.1) for consideration enables him to recover the amount mentioned therein? 4) Whether the plaintiff can be treated as a holder-in-due-course by reason of an endorsement (Ex.A.1) on a document Ex.A.2 which is not a promissory note. The learned Counsel while further elaborating his submissions had taken this Court through Section 4 of the Negotiable Instruments Act (hereinafter, in short, referred to as ‘Act’ for the purpose of convenience) and would maintain that even on a looking at Ex.A.2, it is clear that it is not stamped at all and a promissory note not duly stamped cannot be treated as a promissory note or at any rate, the same cannot be looked into for any purpose and the suit on the strength of such promissory note cannot be maintained. The learned Counsel also further had taken this Court through the findings recorded by the Court of first instance and had pointed out several of the discrepancies in the evidence available on record and would maintain that even otherwise, inasmuch as, the Court of first instance recorded appropriate findings on appreciation of evidence, the reversal made by the appellate Court cannot be sustained. The learned Counsel also placed reliance on certain decisions. 3. The learned Counsel also placed reliance on certain decisions. 3. Sri M. Sudhakar Reddy, the learned Counsel representing respondent-plaintiff, in all fairness, would submit that on the 1st page of the promissory note in question, there are no stamps affixed but it was shown as PTO and on the 2nd page, after referring to the payment made, the stamps had been duly affixed and duly signed by the executant and hence these two portions cannot be treated as separate portions of the document or different portions of the document and all these recitals put together, would satisfy the ingredients of a promissory note as defined by Section 4 of the Act and hence the suit is perfectly maintainable. The learned Counsel placed reliance on certain decisions to substantiate his contentions. While elaborating his submissions, the Counsel also pointed out to the conduct of appellant-defendant and would comment that the Court of first instance was carried away by simple discrepancies whereas the appellate Court had appreciated the evidence in proper perspective and arrived at the correct conclusion. The learned Counsel pointed out to the relevant porltions of the findings recorded by the Court of first instance and also recorded by the appellate Court. The learned Counsel would conclude that, at any rate, such technicalities not to come in the way and liberal view to be taken while construing a document of this nature. The learned Counsel also had pointed out to all the recitals of the document in controversy. 4. Heard the Counsel. Perused the oral and documentary evidence available on record, the findings recorded by the Court of first instance and also the findings recorded by the appellate Court. 5. The unsuccessful defendant, aggrieved by the reversing Decree and Judgment made in A.S.No.125/91 on the file of II-Additional District Judge, Nellore, had preferred the present Second Appeal. The respondent herein-plaintiff instituted O.S.No.170/83 on the file of Subordinate Judge, Nellore, praying for a decree for recovery of the amount based on the strength of a promissory note dt.2-6-1981. 5. The unsuccessful defendant, aggrieved by the reversing Decree and Judgment made in A.S.No.125/91 on the file of II-Additional District Judge, Nellore, had preferred the present Second Appeal. The respondent herein-plaintiff instituted O.S.No.170/83 on the file of Subordinate Judge, Nellore, praying for a decree for recovery of the amount based on the strength of a promissory note dt.2-6-1981. It is the case of the respondent-plaintiff that the appellant-defendant borrowed a sum of Rs.12,000/- from one Chenna Reddy Ramakrishna Reddy on 2-6-1981 and executed a promissory note in his favour and that he borrowed the said amount for his contract works agreeing to repay the same with interest at 12% per annum either to the said Chenna Reddy Ramakrishna Reddy or his order on demand and subsequent thereto, he demanded for payment on several occasions but the defendant did not pay the same and the said Chenna Reddy Ramakrishna Reddy transferred the said promissory note by receiving a sum of Rs.15,000/- in favour of the respondent herein-plaintiff on 15-6-1983 and after transfer, the respondent-plaintiff informed the said fact to appellant-defendant and demanded payment, but since he did not repay the same, the suit was instituted. 6. The appellant herein as defendant in the said suit resisted the same by filing a written statement denying the execution of the promissory note and also had taken a stand that the said Chenna Reddy Ramakrishna Reddy had no capacity to pay the amount at all and the promissory note in question is a forged and fabricated document and further it was pleaded that the respondent herein-plaintiff is a life convict for murder and the suit promissory note is not genuine and not supported by consideration and it is also unstamped and unenforceable in law and hence the respondent-plaintiff is not entitled to recover the said amount. 7. On the strength of the respective pleadings of the parties, the Court of first instance settled the following issues:- 1) Whether the suit pronote is true and genuine? 2) Whether the transfer endorsement on the suit pronote in favour of the plaintiff is true and genuine? 3) Whether the plaintiff is a holder in due course? 4) Whether the suit pronote is unenforceable in law? 5) Whether the suit pronote is not supported by consideration? 6) To what relief? On behalf of the respondent-plaintiff P.Ws. 2) Whether the transfer endorsement on the suit pronote in favour of the plaintiff is true and genuine? 3) Whether the plaintiff is a holder in due course? 4) Whether the suit pronote is unenforceable in law? 5) Whether the suit pronote is not supported by consideration? 6) To what relief? On behalf of the respondent-plaintiff P.Ws. 1 to 5 were examined, Ex.A.1, Ex.A.2 and Ex.A.2A were marked and on behalf of appellant-defendant he had examined himself as D.W.1. The Court of first instance while answering issues 1 to 5, recorded findings in detail on appreciation of evidence available on record and came to the conclusion that the promissory note and the transfer endorsement cannot be believed and ultimately dismissed the suit. Aggrieved by the same, the matter was carried by way of appeal A.S.No.125/1991 on the file of II-Additional District Judge, Nellore. The appellate Court at para 6 framed the following points for consideration:- 1) Whether the defendant has executed promissory note in favour of Ramakrishna Reddy? 2) Whether the plaintiff is a holder in due course? The appellate Court proceeded to discuss the oral and documentary evidence at paras 7 and 8 and ultimately allowed the appeal, decreeing the suit of respondent-plaintiff. Aggrieved by the same, the present Second Appeal is preferred. 8. P.W.1 – the plaintiff deposed that he paid Rs.15,000/- to Chennareddy Ramakrishna Reddy and obtained transfer of the suit promissory note purposed to have been executed by the defendant under Ex.A.1 transfer endorsement dt.15-6-1983. This witness also deposed that Pabbisetty Venkata Krishnaiah and Dasa Lakshminarayana were present at the time of transfer endorsement and he informed the defendant about Ex.A.1 transfer endorsement. The defendant is a Class-I contractor and he demanded the defendant for payment of the amount under suit promissory note. This witness was cross-examined at length. P.W.2 is Chennareddy Ramakrishna Reddy deposed about the payment of the cash consideration under the suit promissory note, which was marked as Ex.A.2, no doubt, subject to objection. This witness deposed in detail relating to Ex.A.2 – the promissory note transaction. This witness was cross-examined at length and several suggestions put to him also had been denied. P.W.3 deposed that the plaintiff had paid Rs.15,000/- and obtained the transfer of the suit promissory note. This witness deposed in detail relating to Ex.A.2 – the promissory note transaction. This witness was cross-examined at length and several suggestions put to him also had been denied. P.W.3 deposed that the plaintiff had paid Rs.15,000/- and obtained the transfer of the suit promissory note. P.W.4 deposed that on 2-6-1981 his friend Bapanaiah took him to Penuballi village in connection with business for paddy and he went there to purchase paddy from P.W.2 and there he had seen the writing of Ex.A.2 by the defendant and cash of Rs.12,000/- was received by the defendant and he had seen the payment of cash consideration and he had seen the signing of Ex.A.1 by the defendant and he attested Ex.A.1 only after reading the contents. This witness was cross-examined at length and certain suggestions put to him were specifically denied. P.W.5 deposed that he along with P.W.4 went to the house of P.W.2 for purchasing paddy and they paid Rs.13,000/- to P.W.2 towards the value of the paddy purchased from him and then P.W.2 paid Rs.12,000/- to the defendant and the defendant himself scribed the pronote and it is Ex.A.2 and this witness also attested the same and the defendant signed on Ex.A.2 in his presence and the defendant had seen the attestors attesting Ex.A.2. The cash payment had taken place in their presence. This witness was cross-examined and suggestions put to this witness had been specifically denied. 9. As against this evidence, the evidence of D.W.1 alone is available on record, who had, no doubt, denied the transaction and also deposed that the writing and the contents in Ex.A.2 and the writing in Ex.A.2A are different and the endorsement ‘PTO’ in the 1st page of Ex.A.2 also is not in his hand-writing and P.W.2 has no capacity to lend Rs.12,000/-. This witness deposed several details relating to Ex.A.2 and had taken a specific stand that the same is a forged one and not a bona fide transaction. This witness was cross-examined at length and certain suggestions put to this witness, no doubt, had been specifically denied relating to the borrowing of the amount and the other aspects. 10. The Court of first instance appreciated the evidence and recorded certain findings and dismissed the suit. This witness was cross-examined at length and certain suggestions put to this witness, no doubt, had been specifically denied relating to the borrowing of the amount and the other aspects. 10. The Court of first instance appreciated the evidence and recorded certain findings and dismissed the suit. The appellate Court, on re-appreciation of evidence, came to the conclusion that the respondent-plaintiff is entitled to the Decree for recovery of amount on the strength of the promissory note in question. On a careful scrutiny of the findings recorded by the appellate Court, this Court is of the considered opinion that as far as the findings recorded on appreciation of evidence relating to the execution of the document in question and also the transfer endorsement, these are concerned, such findings being, predominantly, findings relating to facts, this Court is not inclined to disturb such findings. Though incidentally both the Counsel in relation to the evidence made elaborate submissions available on record. The principal question, which had been argued in elaboration, is that Ex.A.2 is not a promissory note at all and on the strength of such document, a suit for recovery of amount can neither be based nor maintained. Section 4 of the Act dealing with promissory note reads as hereunder:- “A “promissory note” is an instrument in writing (not being a bank-note or a currency-note) containing an unconditional undertaking signed by the maker, to pay a certain sum of money only to, or to the order of, a certain person, or to the bearer of the instrument.” In P.RUKMANGADHA CHETTY vs PUBLIC FINANCE CORPORATION ( 1996 (4) ALT 472 (DB) at paras 6 and 7 observed as hereunder:- “It is to be seen that the contents of suit promissory note Ex.A.1 go to show that the petitioner herein and his son P.Hemadri jointly and severally promised to pay the respondent-Corporation or order the sum of Rs.1,500/- with interest at 18% per annum for value received in cash on that day (i.e., 9-12-1987). So the intention of the document Ex.A.1 is to bind both the petitioner and his son jointly and severally to pay the suit amount. But the petitioner alone executed Ex.A.1 promissory note and his son P. Hemadri did not execute the same. Unless the son of the petitioner executes the promissory note, the intention of binding himself does not arise. So the intention of the document Ex.A.1 is to bind both the petitioner and his son jointly and severally to pay the suit amount. But the petitioner alone executed Ex.A.1 promissory note and his son P. Hemadri did not execute the same. Unless the son of the petitioner executes the promissory note, the intention of binding himself does not arise. Since the son of petitioner does not execute it, it is an incomplete document and hence it becomes unenforceable. More over the document Ex.A.1 was not intended to bind the executants till all the executants had signed and completed it and that it never went beyond the stage of an unperfected proposals. My view of this is supported by the decision rendered by the Madras High Court reported in Sivaswami Chetty vs Sevugan Chetty (1902 (Vol.12) MLJ 17), and also by the decision rendered by the Peshawar High Court reported in Kalu Ram VS Feroz Shah (AIR 1941 Peshawar 45). For the aforesaid reasons, I hold that the suit promissory note Ex.A.2 was not validly executed; it is an incompleted document, hence unenforceable in law, and that no consideration was passed under it.” The Division Bench of the Madras High Court in THENAPPA vs ANDIYAPPA (AIR 1971 Madras 290) held that though a document contains a provision that the stated amount is payable only after certain number of years, it is an unconditional undertaking to pay and the document is a promissory note within the meaning of the Act and therefore it is also a promissory note under Section 2(22) of the Stamp Act 1899. In K. KRISHNA REDDY vs SYED AMEENABIBI ( 1989 (2) ALT 244 ) the learned Judge of this Court held that while promissory note reciting four names as promissors and three of them only signing it, the intention of executants that document would be effective only when all persons recited as promissors signed on that, promissory note must be treated as an incomplete document not giving rise to any rights and the presumption of law under Section 118 of the Act is rebuttable by evidence of executants on their intention and circumstances of the case. In SESHARAL BAINA vs V.C. SUBRAMANIAN (AIR 1983 Madras 368) the learned Judge of the Madras High Court held that until the drawee’s name is inserted before the filing of the suit, the instrument is not a promissory note in the eye of law and in other words, unless the plaintiff or the holder exercises the authority under Section 20 and until it is filled up, it does not import a contract with him and he cannot recover the amount on the instrument and in such a case, permission granted by the Court to fill in the blanks does not cure the defect in the instrument when the permission granted by the Court was without prejudice to the contentions of the executant of the document regarding all points of dispute and it was in such a case, certainly open to the executant to claim that the instrument was not valid on the date of the filing of the suit. In KOCHUTHRESSIA vs DEVADAS (AIR 1988 Kerala 282) while dealing with essentials of a promissory note, the learned Judge observed what Section 4 requires is that an instrument to be a pronote should contain an unconditional undertaking to pay a certain sum of money to (1) a certain (or specified) person, or (2) to the order of such a person, or (3) to the bearer of the instrument. The word ‘or’ in the last part of S.4 denoting the person to whom payment is to be made, is evidently used in a disjunctive sense as is clear from Illustration (b). Therefore, the absence of the words “to the order” is not by itself sufficient to hold that the document is not a pronote. S.5 indicates that the undertaking to repay the amount advanced, only after a month’s notice is not conditional within S.4 as the issue of notice for a month is a “specified event” within S.5, which is certain to happen, having due regard to the ordinary expectation of mankind. When the question before the Court is about the admissibility in evidence of the document in question as a pronote properly stamped under the Stamp Act, the definition of pronote in S.2 (22) thereof would be relevant. S.2 (22) shows that for the purposes of the Stamp Act, at least a note promising payment upon any condition or contingency, certain or not, will amount to a promissory note. S.2 (22) shows that for the purposes of the Stamp Act, at least a note promising payment upon any condition or contingency, certain or not, will amount to a promissory note. The “unconditional undertaking” in S.4 cannot, in the circumstances, completely conclude the question when it arises under the Stamp Act. Reliance was placed on HAMEED HAJI vs APPUKUTTY (AIR 1969 Kerala 189) and the decision SANTSINGH vs MADANDAS (AIR 1976 Madhya Pradesh 144 (FB) had been considered. In KUNDAN MAL vs NAND KISHORE (AIR 1994 Rajasthan 1) it was held that a document in the form of letter acknowledging receipt of certain sum and affixed with 20 paisa Revenue Stamp is only a receipt and cannot be termed as promissory note. In SMT. PULLURU VAJRAMMA vs MORE AGAIAH (1979) I AnWR 100) the learned Judge of this Court while dealing with Omission of expression ‘or his order’ in a document held that when the intention of the parties is clear from the document and all the substantial ingredients of a promissory note are present, there shall not be any objection to treat it as a promissory note simply because one expression ‘or his order’ is absent. While dealing with the requirements of a valid promissory note, the learned Judge of this Court in BAHADURRINISA vs VASUDEV (AIR 1967 A.P., 123) observed:- “Section 4 recognizes three kinds of promissory notes: (1) A promise to pay a certain sum of money to a certain person, (2) a promise to pay a certain sum of money to the order of a certain person, and (3) a promise to pay the bearer. In order that an instrument may fall within the definition of promissory note contained in Section 4 of the Act, it is necessary that there should be: (1) unconditional undertaking to pay, (2) the sum should be a sum of money and it should be certain, (3) the payment should be to, or to the order of, a person, who is certain, or to the bearer of the instrument, and (4) the maker should sign it. Apart from fulfilling the above-said terms of definition of promissory note, the instrument must further satisfy the following three tests: (1) the promise to pay must be substance of the instrument, (2) there must be nothing else inconsistent with the character of the instrument as substantially a promise to pay, and (3) the instrument must be intended by the parties to be a promissory note.” The Division Bench of this Court in STATE BANK, HYDERABAD v RANGANATH (AIR 1966 A.P., 215) held that negotiability is the test of a promissory note and the expression ‘on demand’ in a promissory note has a technical meaning and it means ‘payable immediately or forthwith’. But every document which contains a promise to pay on demand is not necessarily a promissory note and where notwithstanding the existence of towards “on demand”, the documents did not satisfy the test of negotiability, they were not promissory notes.” 11. Ex.A.1 is the transfer endorsement, by virtue of which it is stated that the present respondent-plaintiff got this promissory note transferred in his favour and being a holder-in-due-course for consideration, the suit had been instituted. The question in controversy is whether Ex.A.2 is a promissory note or whether it is duly stamped or whether all the essentials necessary to satisfy the test of being a promissory note are available or not in relation to Ex.A.2. These aspects are the principal aspects, which had been argued in elaboration. There is no serious controversy that the recitals appearing on the 1st page of Ex.A.2 would satisfy the essentials of a promissory note. The executant duly signed the same and ‘PTO’ was written. On the next page, the receipt of Rs.12,000/- had been referred to on the self-same day and on the Revenue Stamps, duly affixed, the executant signed and the same was duly attested by two witnesses. It is true that if the portion of the document shown on the reverse to be severed from the other portion shown on the 1st page, it may have to be taken that inasmuch as the promissory note as such is not duly stamped, the same is inadmissible and a suit cannot be based on the strength of such promissory note. It is also true that on a reading of the recitals of Ex.A.2 at the 1st page, it appears to be a complete promissory note, but however, the stamps were not affixed there, though the executants had signed, but on the reverse, on the self-same day, as a continuation, it was recited that the consideration of Rs.12,000/- had been received and the stamps had been duly affixed and the same was duly signed by the executant and further the same had been duly attested by two attestors. The appellate Court recorded reasons in detail and came to a conclusion that all these recitals may have to be taken into consideration while deciding whether the document in question is a promissory note or not. No doubt, the practice and procedure, which had been followed, in the present case, appear to be a bit novel. But, however, on a careful reading of the recitals, this Court is of the considered opinion that the later portion of the document, the 3 lines on the 2nd page underneath which the stamps had been affixed and the executant had duly signed cannot be separated or severed from the former portion of the document i.e., the 1st page of Ex.A.2, especially, in the light of ‘PTO’ shown on the 1st page and also in the light of the fact that it was recited that the same had been scribed by the executant himself. In the light of these reasons, this Court is of the considered opinion that the document in question to be treated as promissory note since all the recitals appearing both on the 1st page and the 2nd page of Ex.A.2 to be read as a whole for the purpose of deciding whether the essentials of a promissory note within the meaning of Section 4 of the Act are satisfied or not, this Court is thoroughly satisfied that the essentials are satisfied. 12. Hence, the Second Appeal being devoid of merit, the same shall stand dismissed, however, the parties to bear their own costs.