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1965 DIGILAW 279 (MAD)

K. N. Sreenivasan v. P. V. Subramaniam

1965-08-27

M.ANANTANARAYANAN

body1965
Order.- The main point involved in this revision proceeding is a simple one and covered by authority. The Plaintiff (respondent) instituted the suit upon a negotiable instrument, against the maker, namely, the first defendant, employed as a clerk in the Indian. Bank, Ltd. The second defendant is the brother of the first defendant, and an Advocate of this Court. In paragraph 3 of the plaint, the plaintiff stated, that he lent the amount on 26th February, 1958, to the first defendant, and that the first defendant executed a promissory note for cash consideration. At that time, the second defendant put forth an oral guarantee to the plaintiff, that the amount will be duly repaid by the first defendant, and that he stood as guarantor for repayment. This was no part of the terms of the negotiable instrument itself Admittedly, on the instrument, the maker alone is liable, and the second defendant, the revision petitioner, has figured in the document as merely an attestor in respect of execution. The plaintiff filed the suit against both the defendants. He sued the maker (first defendant) for the balance of the amount due, and wanted a decree against the second defendant an guarantor. The Trial Court decreed the suit as prayed for, and the second defendant went before the New Trial Bench, which confirmed that decree. Hence the present revision. Obviously, there is some confusion about the frame of the suit, and it exhibits at misjoinder of causes of action. If it is to be regarded as a suit simpliciter on a negotiable instrument, the second defendant might have been quite an important witness, but he was not liable for the suit claim under the law. That has been laid down in several decisions, stemming from S. Janaki Das v. Sri Kishen Pershad1. If it is to be regarded as a suit simpliciter on a negotiable instrument, the second defendant might have been quite an important witness, but he was not liable for the suit claim under the law. That has been laid down in several decisions, stemming from S. Janaki Das v. Sri Kishen Pershad1. The Judicial Committee laid it down explicitly: “ These sections (sections 26, 27 and 28 of the Negotiable Instruments Act) contain nothing to support the contention, which is contrary to all established rules, that in an action on a bill of exchange or promissory note against a person whose name properly appears as a party to the instrument, it is open either by way of claim or defence to show that the signatory was in reality acting for an undisclosed principal.” In Mahadebram v. Jagannath2, a Bench of the Patna High Court reaffirmed the proposition of law, and held that no person was liable on a hundi or bill of exchange unless his name appears on the instrument as a party liable. Learned Counsel for the plaintiff (respondent) contends that the plea of misjoinder of causes of action was never advanced by the revision petitioner. I find on a scrutiny of the record, that this is correct. I cannot now permit the revision petitioner to succeed on a plea, which he has not chosen to put forward at any stage of the present proceedings so far. But it is equally clear that, strictly in law, with reference to a decree on the negotiable instrument as such, the maker alone would be liable. The present decree therefore really falls into two parts, first a decree on the instrument against the maker (first defendant), and the second, a separate decree on the debt against the guaranter. I therefore direct, allowing the revision to this limited extent, that it now be incorporated as part of the decree that the decree should be executed against the maker (first defendant) for the suit claim, and that, only if that execution fails, should further execution proceed against the second defendant, as guarantor. The. revision is otherwise dismissed. The parties will bear their own costs. With regard to the deposit of Rs. The. revision is otherwise dismissed. The parties will bear their own costs. With regard to the deposit of Rs. 500 already made by the revision petitioner as a condition for stay, in response to a direction of this Court, this will be kept in further deposit for a term of two months from this date, to enable the plaintiff to proceed against the first defendant, the person primarily responsible, by way of execution. If that execution fails, the decree may be executed against the second defendant, and this amount may then be taken by the decree-holder in satisfaction of the suit claim. K.S. ----- Revision allowed in part; Decree modified.