The deposit of cheques for collection determines the territorial jurisdiction of the Court under Section 138 of the Negotiable Instruments Act.

1. The petitioner has challenged the order dated 3rd November, 2009 whereby its complaint under Section 138 of the Negotiable Instruments Act, 1881 has been returned by the learned Metropolitan Magistrate for lack of territorial jurisdiction.

2. The respondents issued four cheques bearing nos. 540162 dated 25th July, 2008 for Rs.14,00,000/-, 540159 dated 25th July, 2008 for Rs.20,00,000/-, 540160 dated 25th July, 2008 for Rs.20,00,000/- and 540163 dated 25th July, 2008 for Rs.6,67,740/- all drawn on Bank of Rajasthan Ltd., Silvassa to the petitioner which were dishonoured upon presentation upon being presented at Bank of Rajasthan Ltd., Service Branch, 82, Janpath, New Delhi.

3. On the last date of hearing i.e. 14th March, 2014, learned counsel for the respondents had disputed that the cheques in question were presented at Delhi because it was not pleaded in the complaint that the four cheques in question were presented by the petitioner at Delhi to which learned counsel for the petitioner submitted that the original dishonor memos issued by the Bank of Rajasthan, Service Branch, 82 Janpath, New Delhi are on record. In order to ascertain the place of deposit of four cheques in question, this Court vide order dated 14th March, 2014 directed respondents no.2 and 3 to remain present in Court along with all original records relating to this case.

4. Respondents no.2 and 3 are not present in Court in terms of order dated 14th March, 2014. However, Mr. Sanjay Kumar Aggarwal, General Manager (Finance) of respondent no.1 is present in Court and he submits that he has been authorized by the Board of Directors of respondent no.1 in the meeting dated 24th March, 2014 to appear before this Court on behalf of the respondents. The extracts of the minutes of meeting dated 24th March, 2014 has been handed over and taken on record. Mr. Sanjay Kumar Aggarwal submits that he is fully conversant with the facts of this case. He submits that the four cheques in question bearing nos. 540162 dated 25th July, 2008 for Rs.14,00,000/-, 540159 dated 25th July, 2008 for Rs.20,00,000/-, 540160 dated 25th July, 2008 for Rs.20,00,000/- and 540163 dated 25th July, 2008 for Rs.6,67,740/- drawn on Bank of Rajasthan Ltd., Silvassa were presented by ICICI Bank Ltd. at Bank of Rajasthan, Janpath, New Delhi and were dishonoured on account of stop payment instructions given by respondent no.1.

5. Since the respondents have now admitted the deposit of cheques by the petitioner at Delhi, only point to be considered is whether the deposit of the four cheques in question would confer territorial jurisdiction on the Courts at Delhi to entertain and try the complaint under Section 138 of the Negotiable Instruments Act.

6. The law with respect to the territorial jurisdiction of the Court under Section 138 of the Negotiable Instruments Act has been set at rest by the Supreme Court in Nishant Aggarwal v. Kailash Kumar Sharma, 2013 (7) SCALE 753 in which the Supreme Court, after considering Shri Ishar Alloy Steels Ltd. (supra) and Harman Electronics Private Limited (supra), held that the Court where the cheque is deposited for collection, has jurisdiction to try the accused under Section 138 of Negotiable Instruments Act in terms of the principles laid down in K. Bhaskaran v. Sankaran Vaidhyan Balan, (1999) 7 SCC 510. The Supreme Court held that the issue of territorial jurisdiction of the Courts did not even arise for consideration in Shri Ishar Alloy Steels Ltd. v. Jayaswals Neco Ltd. (2001) 3 SCC 609, and therefore it does not affect the ratio in K. Bhaskaran (supra). The Supreme Court further observed that in Harman Electronics Private Limited v. National Panasonic India Private Limited, (2009) 1 SCC 720, the Court held that a notice of dishonor under Section 138 of Negotiable Instruments Act alone would not confer the jurisdiction to try the accused at the place of issuance of the notice. However, the Supreme Court did not deviate from the other principle