Seylan Merchant Bank Ltd. v. Savoy Developers (Pvt.) Ltd. And Others – sllr 2006 volume 2 page 314

The case between Seylan Merchant Bank Ltd. (Plaintiff) and Savoy Developers (Pvt.) Ltd. and others (Defendants) addressed whether a Guarantee Bond executed pursuant to a duly stamped Lease Agreement must itself be stamped to the same value, or if it is exempt under the Stamp Duty Act, No. 43 of 1982. It was held that the Guarantee Bond is exempt from additional stamp duty when tendered in evidence, as it is part of the same transaction as the duly stamped Lease Agreement. The principle reaffirmed is that exemption under section 5(5) of the Stamp Duty Act applies to such documents when the primary instrument is properly stamped. The decision relied on sections 5(5) and 33(1) of the Stamp Duty Act and relevant case law, clarifying that compliance with stamping requirements for the principal