P V KOTHANDARAMASWAMI NAIDU Vs. PMAMUTHIA CHETTI

JUDGEMENT

(1.) This appeal raises an interesting question, as to whether a suit can be filed on an endorsement made by a stranger on the back of a note, who does not satisfy the definition of an endorser. There is such a usage of law on the continent known as the making of an aval, which is recognised by Section 56 of the English Bills of Exchange Act, but there is no recognition of it in the Indian Negotiable Instruments Act. It was with reference to the Bills of Exchange Act that we are told in the well-known words of Lord Halsbury in the Vagliano case, (1891) A.C. 107; Co L.J.Q.B. 145 : 64 L.T. 353 : 39 W.R. 657 : 55 J.P. 676. that the essence of a Code is to be exhaustive. We may apply that principle to the Negotiable Instruments Act, and say that we are not prepared to recognise this backing of bills by strangers. That is the view which I am at present disposed to take, but it is not necessary to express a final opinion on the point, because I think the appeal fails upon another ground.

(2.) Section 118 of the Negotiable Instruments Act provides that the presumption is that the endorsements were made in the same order as the names appear on the back of the bill, and in this case it is the payee s name that appears first and then the name of the alleged endorser. There is evidence also that this was the case, though the evidence is not of a very satisfactory character. On the other hand, the defendants did not go into the box to establish that the endorsements were made in any other order. On the whole, I think that there is no sufficient evidence to rebut the presumption that the endorsements were made in the order in which they occur. If that be so, I think that there is sufficient ground to sue the endorsers of the promissory notes.

(3.) In the result, the appeal fails and must be dismissed with costs. Sadasiva Aiyar, J.