Payable On Demand - Definition - Law Dictionary Home Dictionary Definition payable-on-demand

Definition :

Payable on demand, The words 'payable on demand' in a promissory note mean payable 'at once'. Ajyappankutty v. Mathoo Mathai, AIR 1955 Trav 65 (66). (Travancore Cochin Stamp Act, 1899, Art. 89)

The words 'payable on demand' have been given different meaning when applied with reference to 'money lent' and 'money deposited'. In the content of Art. 21, the meaning and effect of these words is 'always payable' or payable from the moment when the loan is made, whereas in the content of Art. 22, 'the meaning is 'payable when actually a demand for payment is made'. The words 'on demand' in law have a special meaning and when an agreement states that an amount is payable on demand. It implies that it is always payable, that is payable forthwith and a demand is not a condition precedent for the amount to become payable. The meaning attached to the expression 'on demand' as 'always payable' or 'payable forthwith without demand' is not one of Universal application. The said meaning is normally applied to promissory notes, or bill of exchange payable on demand, Syndicate Bank v. Chanaveerappa Beleri, AIR 2006 SC 1874. [See also Limitation Act (36 of 1963), Arts. 21, 22, 55]