Case Note & Summary
The present revision application under Section 397 read with Section 401 of the Code of Criminal Procedure, 1973 (CrPC) was filed by Shriram Transport Finance Company Ltd. through its Power of Attorney, Kuldipsinh Mahendrasinh Sarvaiya, challenging the order dated 29.03.2022 passed by the learned 2nd Additional Chief Judicial Magistrate, Mahuva, District Bhavnagar, in Criminal Inquiry No.13 of 2022. The learned Magistrate had returned the criminal complaint to the complainant along with the list and other documents, concluding that he had no territorial jurisdiction to try the criminal inquiry. The brief facts are that the opponent had taken a vehicle loan from the applicant/complainant and failed to pay regular installments. After repeated demands, the opponent issued Cheque No.000044 dated 24.11.2021 for ₹2,75,000/- drawn on Axis Bank, Mahuva Branch, in favor of the complainant. The complainant deposited the cheque at Axis Bank, Mahuva Branch, Taluka Mahuva, District Bhavnagar, Gujarat. The cheque was dishonoured with the endorsement 'Account Closed'. The complainant issued a statutory notice from Mahuva and thereafter filed a complaint under Section 138 of the Negotiable Instruments Act, 1881 (NI Act) before the learned Magistrate at Mahuva. The learned Magistrate, without recording any reasons, returned the complaint on the ground of lack of territorial jurisdiction, holding that since the cheque was drawn on Axis Bank, Mahuva, the jurisdiction lies only at Mahuva, but the complainant had not shown any cause for jurisdiction. The High Court observed that the Magistrate failed to record reasons as required under Section 201 CrPC and failed to consider that the cheque was presented for collection at Axis Bank, Mahuva, which is within his territorial jurisdiction. The court held that under Section 142(2) of the NI Act, the place where the payee maintains an account and presents the cheque is a relevant factor for jurisdiction. The impugned order was set aside, and the matter was remitted back to the learned Magistrate to decide the complaint afresh on merits, after giving an opportunity of hearing to both parties, in accordance with law.
Headnote
A) Criminal Procedure Code - Return of Complaint - Section 201 CrPC - Jurisdiction - The Magistrate must record reasons before returning a complaint for lack of jurisdiction; failure to do so renders the order unsustainable. (Para 5) B) Negotiable Instruments Act - Territorial Jurisdiction - Section 138 read with Section 142(2) - Cheque Dishonour - The place where the cheque is presented for collection and the branch where the payee maintains an account are relevant for determining jurisdiction; the Magistrate erred in solely relying on the drawee bank branch. (Paras 6-7) C) Negotiable Instruments Act - Territorial Jurisdiction - Section 138 - Cheque Dishonour - The complainant presented the cheque at Axis Bank, Mahuva branch, which is within the territorial jurisdiction of the learned Magistrate; hence, the Magistrate had jurisdiction to try the complaint. (Paras 2, 7)
Issue of Consideration
Whether the learned Magistrate was justified in returning the complaint for lack of territorial jurisdiction without recording reasons and without considering the place where the cheque was presented for collection.
Final Decision
The High Court allowed the revision application, set aside the impugned order dated 29.03.2022 passed by the learned 2nd Additional Chief Judicial Magistrate, Mahuva, in Criminal Inquiry No.13 of 2022, and remitted the matter back to the learned Magistrate to decide the complaint afresh on merits, after giving an opportunity of hearing to both parties, in accordance with law.
Law Points
- Territorial jurisdiction under Section 138 NI Act determined by place of cheque presentation
- not branch of drawee bank alone
- Return of complaint under Section 201 CrPC requires recording of reasons
- Section 142(2) NI Act provides for jurisdiction at place of branch where payee maintains account
