AIR 1967 ANDHRA PRADESH 123

Andhra Pradesh High Court

Hon'ble Judge(s): Gopal Rao Ekbote , J

(A) Negotiable Instruments Act (26 of 1881) , S.4— Requirements of valid promissory note - Instrument containing unconditional undertaking to pay certain sum of money to certain person would be promissory note even without any words of negotiability. Stamp Act (2 of 1899) , S.2(22)— 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.(Para 6) 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 abovesaid 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.....