Tax Judgment EP7 Stamp Duty

Q : Whether a loan agreement without a stamp duty or with a stamp duty but not be cancelled is admissible in order that the Plaintiff shall be liable under the Act on Offenses Arising from the Use of Cheque B.E. 2534 (“Cheque Act”)? How?

A : A loan agreement is one of the instruments that shall be stamped in accordance with Clause 5 of Stamp Duty Schedule. If the instrument is not stamped or it is stamped but not cancelled, it shall be deemed the instrument not duty stamped in accordance with Section 103 of Thai Revenue Code (“TRC”), resulting in being inadmissible evidence in civil case in accordance with Section 118 of the TRC. Thus, in criminal prosecution regarding the liability under the Cheque Act, despite the fact that the Defendant issues a cheque to pay the Plaintiff for a loan and such loan is not made in writing, it shall be deemed a legally unenforceable debt. It is due to the fact that the issuance of such cheque by the Defendant lacks the elements of crime in accordance with Section 4 of the Cheque Act. The Defendant was found not guilty as claimed in this case.

The Supreme Court Judgment No. 5477/2543 (2000) As the loan agreement which was an instrument that the Plaintiff claimed as evidence was not stamped, it shall be deemed inadmissible evidence in civil case in accordance with Section 118 of the TRC and shall be deemed that the loan between the Plaintiff and the Defendant was not made in writing. The Plaintiff shall not be able to bring such agreement to sue the Defendant for refunding such loan. Therefore, it was a legally unenforceable debt. In spite of the fact that the Defendant issued a cheque to pay the Plaintiff for a loan and such loan was legally unenforceable, the issuance of such cheque by the Defendant lacked the elements of crime in accordance with Section 4 of the Cheque Act.

The Supreme Court Judgment No. 5829/2540 (1997) As the loan agreement which was an instrument that the Plaintiff claimed as evidence was stamped but such stamp was not cancelled, it shall be deemed inadmissible evidence in the civil case pursuant to Section 118 of the TRC. Despite the fact that the Defendant owed the Plaintiff a loan according to the cheque and issued the cheque to the Plaintiff, it shall be deemed a legally unenforceable debt. The Defendant’s act lacked the elements of crime pursuant to Section 4 of the Cheque Act and found no guilty as claimed.