SC on Territorial Jurisdiction : NI Act

SC on Territorial Jurisdiction:NI Act (Cheque Bouncing)

A 3-Judge Bench of Hon'ble Supreme Court, in its landmark judgement has settled issues related to Court’s territorial jurisdiction concerning criminal complaints filed under Chapter XVII of the Negotiable Instruments Act, 1881 (for short, ‘the NI Act’).

Points to Note:

(1) The return of the cheque by the drawee bank alone constitutes the commission of the offence and indicates the place where the offence is committed.

(2) The place, situs or venue of judicial inquiry and trial of the offence must logically be restricted to where the drawee bank, is located.

(3) The territorial jurisdiction is restricted to the Court within whose local jurisdiction the offence was committed, which in the present context is where the cheque is dishonoured by the bank on which it is drawn.

(4) Only those cases where, post the summoning and appearance of the alleged Accused, the recording of evidence has commenced as envisaged in Section 145(2) of the Negotiable Instruments Act, 1881, will proceeding continue at that place. 

(5) Regardless of whether evidence has been led before the Magistrate at the pre-summoning stage, either by affidavit or by oral statement, the Complaint will be maintainable only at the place where the cheque stands dishonoured. 

(6) The category of Complaint cases where proceedings have gone to the stage of Section 145(2) or beyond shall be deemed to have been transferred from the Court ordinarily possessing territorial jurisdiction, as now clarified, to the Court where it is presently pending. All other Complaints (including those where the accused/respondent has not been properly served) shall be returned to the Complainant for filing in the proper Court.

(7) If such Complaints are filed/refiled within thirty days of their return, they shall be deemed to have been filed within the time prescribed by law, unless the initial or prior filing was itself time barred.

(8) The relief introduced by Section 138 of the NI Act is in addition to the contemplations in the IPC. It is still open to such a payee recipient of a dishonoured cheque to lodge a First Information Report with the Police or file a Complaint directly before the concerned Magistrate.

PS: We do not accept any liability arising out of use of above information. Users are advised to apply their own thoughts and experience in above case.

Case Number: 

CRIMINAL APPEAL NO. 2287 OF 2009

Case Title:
Dashrath Rupsingh Rathod Versus State of Maharashtra & Anr.

Bench:

Hon'ble Justice T.S. THAKUR

Hon'ble Justice VIKRAMAJIT SEN
Hon'ble Justice C. NAGAPPAN

Date of Judgement: 
1st August 2014

Blog Link:
http://jeetendergupta.blogspot.in/2014/08/sc-on-territorial-jurisdiction-ni-act.html

Full judgement / Order Link:
http://judis.nic.in/supremecourt/imgs1.aspx?filename=41801

Supreme Court Directions - Cheque Bouncing Cases

Supreme Court Directions - Cheque Bouncing Cases 

Hon'ble Supreme Court has issued direction to all the Criminal Courts in the country dealing with Section 138 cases to follow the below-mentioned procedures for speedy and expeditious disposal of cases falling under Section 138 of the Negotiable Instruments Act.

Directions to Criminal Courts dealing Section 138 cases 

(1) Metropolitan Magistrate/Judicial Magistrate (MM/JM), on the day when the complaint under Section 138 of the Act is presented, shall scrutinize the complaint and, if the complaint is accompanied by the affidavit, and the affidavit and the documents, if any, are found to be in order, take cognizance and direct issuance of summons.

(2) MM/JM should adopt a pragmatic and realistic approach while issuing summons. Summons must be properly addressed and sent by post as well as by e-mail address got from the complainant. Court, in appropriate cases, may take the assistance of the police or the nearby Court to serve notice to the accused. For notice of appearance, a short date be fixed. If the summons is received back un-served, immediate follow up action be taken.

(3) Court may indicate in the summon that if the accused makes an application for compounding of offences at the first hearing of the case and, if such an application is made, Court may pass appropriate orders at the earliest.

(4) Court should direct the accused, when he appears to furnish a bail bond, to ensure his appearance during trial and ask him to take notice under Section 251Cr.P.C. to enable him to enter his plea of defence and fix the case for defence evidence, unless an application is made by the accused under Section 145(2) for re-calling a witness for cross-examination.

(5) The Court concerned must ensure that examination-in-chief, cross-examination and re-examination of the complainant must be conducted within three months of assigning the case. The Court has option of accepting affidavits of the witnesses, instead of examining them in Court. Witnesses to the complaint and accused must be available for cross-examination as and when there is direction to this effect by the Court.

PS: We do not accept any liability arising out of use of above information. Users are advised to apply their own thoughts and experience in above case.

Case Number: 

Writ Petition (Civil) No.18 of 2013

Case Title:
Indian Bank Association and others Versus Union of India and others 

Bench:

Hon'ble Justice K.S. Radhakrishnan

Hon'ble Justice Vikramajit Sen

Date of Judgement: 
21st April 2014

Blog Link:
http://www.jeetendergupta.blogspot.in/2014/05/supreme-court-directions-2014-cheque.html

Full judgement / Order Link:
http://judis.nic.in/supremecourt/imgs1.aspx?filename=41436