The law of the place where the instrument is made payable determines dishonor, and the provisions of the Negotiable Instruments Act provide safeguards for companies in India to proceed against foreign companies if instruments are dishonored.

1. This Criminal Original Petition has been filed to quash the complaint in C.C.No.3610 of 2002, pending on the file of the IX Metropolitan Magistrate Court, Saidapet, Chennai as far as the petitioners are concerned.

2. The brief facts of the case are as follows:-

The respondent filed a complaint against the petitioners and others who were Directors of M/s.Trilux Technologies Singapore Ltd., at Singapore for alleged offences under Sections 138 and 142 of the Negotiable Instruments Act. According to the complainant, he developed a software and exported the same to the accused-company in the month of December, 2001 which was confirmed by the accused by their letter dated 18.12.2001. The accused sent two cheques dated 18.2.2002 for U.S.$ 7800 each drawn on Overse as Chinese Bank of Corporation Ltd., Singapore, in the Foreign Currency Account and the cheques were sent by the 7th accused on behalf of the first accused. The other accused are holding posts in the company as Directors and they are responsible for the day to day administration of the business. When the cheques were presented at Andhra Bank, Ashok Nagar Branch, Chennai, the cheques were dishonoured on 26.3.2002 for the reason “refer to drawer” and the complainant received the said intimation from the Bankers on 5.4.2002. When the complainant issued statutory notice demanding payment of money, the notices were served on the 3rd and the 7th accused and notices to other accused returned as “refused”. Hence a complaint was lodged against all the accused before the IX-Metropolitan Magistrate, Chennai.

3. The only contention urged on behalf of the petitioner is that the cheques were drawn at Singapore, on a foreign Bank Account at Singapore and therefore a complaint could not be lodged for dishonour of the cheques at Madras.

4. The complainant has entered into a contract with A-1 for developing and hosting Web based Tutorials of various subjects at a fixed price of US$ 7800 and the first petitioner has agreed to pay US$ 7800 per title and an invoice may be raised on successful completion of the work. There is no dispute that the complainant-respondent complweted the job requirement to A.1. There is also no denial of liability by A-1 towards payment. On the other hand the two cheques dated 18.2.2002 for US$ 7800 each issued by A.1 drawn on M/s.Overseas Chinese Banking Corporation Ltd., Chulia Street, Singapore Foreign Currency Accounts, when presented in the complainant's Bank viz., Andhra bank, Ashok Nagar Branch, Madras, were dishonoured by the bankers of the accused on 26.3.2002 for the reason “refer to drawer” and the intimation was received by the complainant from the bankers on 5.4.2002. Statutory Notice was also issued by the complainant which was served on the 3rd, 7th accused and the notices sent to the other accused were returned as “refused”, which resulted in the filing of the complaint. 2nd 3rd, and 4th accused are Directors of the first petitioner/A-1 who are residents of Madras. The accused 5, 6 and 7 are residents of Singapore and the first petitioner-Company is also situate at Singapore.

5. The contention of the petitioners is that the Courts in India (Madras) have no jurisdiction on the ground that the cheques were drawn on a Foreign Bank at Singapore and therefore payable at Singapore only and thus there is no jurisdiction for a court in Madras.

6. In this respect, it is relevant to refer to the statutory provisions contained in the Negotiable Instruments Act. Section 135 of the Negotiable Instruments Act reads as follows:-

“135: Law of Place of Payemnt Governs Dishonour :- Where a promissory note, bill of exchange or cheque is made payable in a different place from that in which it is made or indorsed, the law of the place where it is made payable determines what constitutes dishonour and what notice of dishonour is sufficient”.

7. Section 136 of the Act reads thus:-

“136. Instruments Made, Etc., out of India but in Accordance With The Lawof Indi