It says in the hadeeth, “Do not call me Sayyid in your prayers”. Is this hadeeth (report) saheeh (authentic)? I would prefer to say “Allahumma salli ‘ala sayyidina Muhammad” and not just “Allahumma salli ‘ala Muhammad”.
The wording mentioned does not appear in any hadeeth from the Prophet (peace and blessings of Allah be upon him). This has been stated by the scholars:
Al-Imam al-Sakhawi (may Allah have mercy on him) said: It has no basis. End quote.
Al-Maqasid al-Hasanah, p. 135.
Ibn Hajar al-Haythami (may Allah have mercy on him) said: It has no basis. End quote.
Al-Fatawa al-Fiqhiyyah al-Kubra, 1/151
Most of those who compiled books of fabricated hadeeths agreed with them. See: al-Masnoo‘ fi Ma‘rifat al-Mawdoo‘, by al-Mulla ‘Ali al-Qari, p.205.
Many of the fuqaha (jurists) have stated in their books that this hadeeth is rejected, as it says in Radd al-Muhtar (1/513), al-Fawakih al-Dawani (2/359) and Nihayat al-Muhtaj (1/530).
The scholars of the Standing Committee said:
The hadeeth “Do not call me Sayyid…” has no basis, as was stated by the author of Kashf al-Khifa. As for the hadeeth, “I will be the leader (Sayyid) of the children of Adam on the Day of Resurrection, and but I do not boast about it,” it is part of a lengthy hadeeth that was narrated by al-Imam al-Tirmidhi from Abu Sa‘eed al-Khudri; he said: It is a hasan saheeh hadeeth (sound and authentic report).
As for calling the Messenger (peace and blessings of Allah be upon him) “Sayyid” in cases other than the adhan (call to prayer), iqamah (final call to prayer) and prayer, this is permissible because of the hadeeth quoted above.
With regard to the adhan, iqamah and tashahhud (sitting position) in prayer, one should say it as it is narrated in the Sunnah (prophetic teachings) and not add anything to what is prescribed, because the adhan, iqamah and prayer are acts of worship, and worship is strictly to be done in accordance with the text of the Quran and Sunnah, so it is limited to what is mentioned in the evidence. End quote.
‘Abd al-‘Azeez ibn Baz, ‘Abd al-Razzaq ‘Afeefi, ‘Abd-Allah ibn Ghadyan
Fatawa al-Lajnah al-Daimah (vol. 3/265)
With regard to the ruling on adding the word “Sayyidina” in al-Salah al-Ibraheemiyyah (a supplication said in the final sitting position of the formal prayer), it is one of the matters concerning which the scholars differed. We have mentioned above that it should not be said and that it is better to limit oneself to what is mentioned in the Sunnah, because prayer is an act of worship and is strictly to be done in accordance with the text of the Quran and Sunnah, so nothing should be added to it except on the basis of shar‘i (legal, religious) evidence.
And Allah knows best.