The central legal point established in the judgment is that the entitlement to claim payment on a promissory note is determined by the holder of the note, as per the provisions of the Negotiable Instruments Act.

Kotval—The defendant executed a promissory note in favour of Pralhad Ganesh, the brother of the plaintiff. The plaintiff claimed payment of the amount due on the promissory note which was not indorsed to him, alleging that the money advanced thereon was his and was advanced on his behalf by Pralhad. The defence was that the plaintiff not being the payee had no right to claim payment and was not entitled to maintain the suit. The defence having succeeded the plaintiff seeks revision of the decree of the lower Court.

2. Section 78, Negotiable Instruments Act 26, 1881, provides that, subject to the provisions of Section 82, Clause (c), payment of the amount due on a promissory note, bill of exchange or cheque must, in order to discharge the maker or acceptor, be made to the holder of the instrument. The provisions of Section 82(c) have no application in this case. Applying Section 78 to the present case the defendant will not be discharged from liability on the note unless he has paid the sum due on it to the holder. The question, therefore, remains whether the plaintiff is the holder for he has no right to claim the sum if by payment to him the liability cannot be discharged.

3. Under Section 8 the holder of a promissory note means any person entitled in his own name to the possession thereof and to receive or recover the amount due thereon from the parties thereto. In the case of a promissory note not payable to the bearer ''the person entitled in his own name'' can only mean the person named in the note, that is the payee or the indorsee : see Ramanuja Ayyangar v. Sadagopa Ayyangar,1905 28 ILR(Mad) 205, Subba Narayana Vathiyar v. Ramaswami Aiyar, 1907 30 ILR(Mad) 88 and Reoti Lal v. Manna Kunwar, 1922 AIR(All) 70. The holder in the present case then is Pralhad and not the plaintiff, and Pralhad alone can claim the amount, for by payment to him alone can the defendant's liability be discharged.

4. The doctrine of benami cannot be applied in a case like this where the law by clear implication excludes its application. The application of the doctrine to negotiable instruments would, by introducing an element of uncertainty into them, hamper commerce, for facility of which they are largely used. On the other hand, the property in the instruments being transferable by mere indorsement the benamiship may easily be eliminated.

5. As to the prayer to be allowed to amend the plaint by adding Pralhad as a party it is clear that the object of the joinder of Pralhad was not to enable a decree to be passed in his favour but to enable one to be passed in the plaintiff's, favour. That object could not have been gained by the joinder of Pralhad.

6. The suit was rightly dismissed. This application is dismissed with costs.

Final Result : Dismissed