Case Note & Summary
The Supreme Court addressed transfer petitions filed by the accused company seeking transfer of a complaint under Section 138 of the Negotiable Instruments Act, 1881, from the court of Judicial Magistrate First Class, Bhopal, to the court of Metropolitan Magistrate, Kolkata. The dispute arose from a cheque drawn on a Kolkata bank, presented by the complainant in its bank account in Bhopal, and dishonoured for insufficient funds. After issuing statutory notice and receiving no payment, the complainant initially filed the complaint before the Metropolitan Magistrate, Kolkata, which took cognisance, issued summons, framed charge, and even recorded the complainant's evidence-in-chief. However, following the enactment of the Negotiable Instruments (Amendment) Act, 2015, which stipulated that jurisdiction lies where the payee maintains his account, the complainant applied for return of the complaint, and the Metropolitan Magistrate, Kolkata, returned it for lack of jurisdiction. The complaint was then refiled before the Judicial Magistrate First Class, Bhopal, where the accused objected to territorial jurisdiction, but the objection was rejected. The accused then filed the present transfer petitions before the Supreme Court, contending that the trial had already commenced in Kolkata and should continue there. The Court framed two key issues: first, whether after the 2015 Amendment, the court where the drawee bank is situated has jurisdiction; and second, whether a complaint can be transferred to that court if recording of evidence under Section 145 has already started there. To resolve these issues, the Court undertook a detailed analysis of the legal position prior to and after the amendment. It examined the landmark judgments in K. Bhaskaran v. Sankaran Vaidhyan Balan, which established that the offence under Section 138 is not complete upon dishonour alone but involves multiple acts, and jurisdiction can be founded at the place of any of those acts under Section 178(d) of the Code of Criminal Procedure, 1973. The judgment also mentioned the need to interpret the amended provisions, including the expressions 'delivered for collection through an account' and 'maintains an account'. However, the provided excerpt ends before the Court's final conclusion and decision on the transfer petitions, leaving the outcome unknown.
Headnote
A) Negotiable Instruments Act - Territorial Jurisdiction under Section 138 Prior to 2015 Amendment - Multiple Acts Determining Jurisdiction - Section 138, Negotiable Instruments Act, 1881; Sections 177, 178, Code of Criminal Procedure, 1973 - The Supreme Court examined the precedent in K. Bhaskaran v. Sankaran Vaidhyan Balan, where it was held that the offence under Section 138 consists of five acts: drawing, presentation, dishonour, notice, and failure to pay, and by virtue of Section 178(d) CrPC, jurisdiction lies in any court where one of these acts occurs - The court observed that the rule in Section 177 CrPC is not invariable and that the trial court had erred in declining jurisdiction based solely on the place of dishonour - Held that jurisdiction can be founded at the place of drawing or presentation of the cheque as well (Paras 15-20).
Issue of Consideration
Whether after the enactment of the Amendment Act, 2015, the court within whose local jurisdiction the drawee bank is situated, has the jurisdiction to try a complaint under Section 138? Whether after the enactment of the Amendment Act, 2015, a complaint under Section 138 of the Act, 1881 can be transferred to the court within whose local jurisdiction the drawee bank is situated, if the recording of evidence under Section 145 has already commenced in the said court?
Final Decision
The provided text does not contain the court's final decision.
Law Points
- territorial jurisdiction under Section 138 NI Act
- multiple acts theory from K. Bhaskaran
- effect of Negotiable Instruments (Amendment) Act 2015 on jurisdiction
- interpretation of Section 142(2) and Explanation
- conjoint reading of provisions
- transfer of complaint after commencement of evidence
