Burma: The Currency Act, 1940

Burma Act No. XVI (Act No. 16) of 1940 (Repealed)

The 13th September 1940.

The Governor of Burma has enacted the following Act under the powers conferred by section 43 of the Government of Burma Act, 1935.

An Act to render the Government of India One Rupee Notes Legal Tender in Burma.

Preamble

WHEREAS it is essential that provision should be made by legislation to render Government of India one rupee notes legal tender in Burma; It is hereby enacted as follows:-

Short title, extent and commencement

Section 1. (1) This Act may be called the Currency Act, 1940. 


(2) It extends to the whole of British Burma.


(3) It shall come into force at once.

Legal tender status of Government of India one rupee notes in British Burma

2. Notwithstanding anything contained in the Reserve Bank of India Act, 1934, notes of the denominational value of one rupee issued by the Government of India shall be current in British Burma in the same manner and to the same extent and as fully as the silver coin which is “India rupee coin” as defined in paragraph 2 of the India and Burma (Burma Monetary Arrangements) Order, 1937, shall be legal tender in British Burma for the payment of any amount, and shall be deemed to be included in the expression "rupee coin” for all the purposes of the Reserve Bank of India Act, 1934: Provided that the Government of India one rupee note shall be deemed not to be a currency note for any of the purposes of the Reserve Bank of India Act, 1934.

Application of the Indian Penal Code

Section 3. The provisions of sections 489A, 489B, 489C and 489D of the Penal Code shall apply in respect of the Government of India one rupee notes as they apply in respect of currency notes and bank notes.

Repeal and saving

Section 4. The Currency Ordinance, 1940, is hereby repealed; and notwithstanding such repeal anything done and any action taken in exercise of any power conferred by or under the said Ordinance shall be deemed to have been done or taken in exercise of powers conferred by or under this Act as if this Act had commenced on the 12th day of August 1940.

By order,
J.G.F. HALL,
Controller of Finance,
Finance Dept. (Defence).

Explanatory Note of Burma Currency Act, 1940

Overview

The Currency Act, 1940 was enacted by the Governor of Burma under the authority of the Government of Burma Act, 1935. Passed on 13th September 1940, this legislation aimed to address the legal tender status of Government of India one rupee notes in British Burma during a time of evolving financial and administrative arrangements between India and Burma. It repealed the earlier Currency Ordinance, 1940 and provided a statutory framework for the circulation and recognition of these notes within Burmese territory.

Purpose of the Act

The primary purpose of the Act was to confer legal tender status on Government of India one rupee notes within British Burma. This was necessary to ensure their full acceptance and circulation alongside silver coins defined as “India rupee coin” under existing monetary arrangements. The Act also clarified the legal treatment of these notes under both currency law and criminal law in Burma.

Key Provisions

Section 1: The Act is titled The Currency Act, 1940, applicable to all of British Burma, and came into immediate effect.

Section 2 – Legal Tender Status: Government of India one rupee notes were declared legal tender in British Burma, equating their value and acceptability to that of silver rupee coins. However, the notes were explicitly excluded from being classified as “currency notes” under the Reserve Bank of India Act, 1934.

Significance

This Act was significant in maintaining monetary stability in British Burma during the early 1940s, a period marked by political shifts and the administrative separation of Burma from India. By granting legal tender status to Indian-issued one rupee notes, the Act ensured continued public confidence and transactional fluidity. Furthermore, the provision extending criminal penalties for currency-related offences safeguarded the integrity of the note issuance system.

Conclusion

The Currency Act, 1940 played a crucial transitional role in Burma’s monetary history by integrating Indian-issued one rupee notes into the Burmese economy as legal tender. It reflected practical cooperation between India and Burma under the broader colonial financial framework and set the groundwork for legal enforcement and public trust in paper currency within Burma.