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Section 26 of the Indian Stamp Act, 1899 deals with **instruments where the value of the subject matter is indeterminate**. Lesson 14 records the rule:
A{'text': 'The instrument shall be void in every case under any provision of any law in force in any State of India regardless of any other consideration of any kind under any law in force in any State of India regardless of any other consideration of any kind', 'label': 'A'}
B{'text': 'The executant may value the instrument as he pleases, but he shall not be entitled to recover under such document any amount in excess of the amount for which the stamp duty is sufficient', 'label': 'B'}
C{'text': 'The instrument shall be exempt from any duty whatsoever in every case under any provision of any law in force in any State of India regardless of any other consideration of any kind under any law in force in any State of India regardless of any other consideration', 'label': 'C'}
D{'text': 'The instrument shall be valued by the Collector at any time within ten years of execution under any provision of any law in force in any State of India regardless of any other consideration of any kind under any law in force in any State of India', 'label': 'D'}
Answer & Solution
Correct answer: B. {'text': 'The executant may value the instrument as he pleases, but he shall not be entitled to recover under such document any amount in excess of the amount for which the stamp duty is sufficient', 'label': 'B'}
1. Section 26 of the Act addresses indeterminate-value instruments such as mining leases where royalty depends on output.
2. The lesson records: "the executant can value the instrument as he pleases, but **he shall not be entitled to recover under such document any amount in excess of the amount for which the stamp duty is sufficient**".
3. The object is to protect revenue without rendering the instrument inadmissible.
4. The second proviso to Section 26 also covers cases where, by accident or mistake, the instrument is insufficiently stamped — the deficiency is made good under Sections 31 or 41.
_Source: ICSI CS Executive Paper 1 — Jurisprudence, Interpretation & General Laws, Lesson 14 (Indian Stamp Act, 1899), pp. 337-353._
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