SupremeToday Landscape Ad
Back
Next
Judicial Analysis Court Copy Headnote Facts Arguments Court observation
Listen Audio Icon Pause Audio Icon
judgment-img

2023 Supreme(P&H) 2584

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
AMAN CHAUDHARY, J.
P.S. Raj Steels Private Ltd. – Petitioner
Versus
Reliance Steel Industries & Anr. – Respondent
CRM-M NO. 46627 of 2016 (O&M)
Decided On : 13-04-2023

Advocates Appeared:
Mr. Jainainder Saini, Advocate; For the Petitioner

Headnote:(A) Negotiable Instruments Act, 1881 - Section 138 and Section 142 - Complaint regarding dishonor of a cheque returned on jurisdictional grounds - Amendments to the Act permit filing in the jurisdiction of payee or holder’s bank; thus, previous decision requiring local jurisdiction where drawee bank is situated is no longer applicable. (Paras 3, 6-10)

(B) Jurisdiction - Territorial jurisdiction for cases under Section 138 now considers the bank branch where the cheque is delivered for collection and is deemed to have been in force retrospectively. (Para 9)

Facts of the case:
The petitioner filed a complaint against respondents for dishonoring a cheque. The trial court returned the complaint based on earlier judicial interpretation concerning jurisdiction according to the location of the drawee bank. Respondents failed to appear in court despite issuance of bailable warrants.

Findings of Court:
The court upheld the amendment allowing complaints to be filed where the cheque is presented regardless of the drawee bank’s location, thus restoring the complaint for legal proceedings.

Issues: Whether the complaint returned for lack of jurisdiction can be reinstated given the amendment to the Act regarding the jurisdiction of dishonor cases.

Ratio Decidendi: The court found that the amendment to the Negotiable Instruments Act effectively changed the jurisdictional requirements regarding where case filings could occur, rendering the previous standards obsolete.

Result: Petition allowed. The order dated 17.10.2014 is set aside and the complaint is restored to its original number for further proceedings.

Table of Content
1. facts regarding complaint and dishonoured cheque. (Para 1 , 2)
2. argument against returning the complaint. (Para 3)
3. court's observations on jurisdiction issues. (Para 4 , 5 , 8 , 9)
4. ratio decidendi on jurisdiction under amended section 142. (Para 6 , 7)
5. conclusion to restore the complaint. (Para 10)

JUDGMENT

Aman Chaudhary, J.

Present petition has been filed under Section 482 Cr.P.C. for setting aside of order dated 17.10.2014, vide which the complaint case No.2620-II dated 02.12.2013 titled as ' P.S. Raj Steels Private Ltd. v. Reliance Steel Industries and another' under section 138 of the Negotiable Instruments Act, was returned in original to be filed at the place having its proper jurisdiction.

2. Briefly put, the facts as emerge from the complaint, are that respondents had purchased SS Pipes from the complainant-petitioner on credit and in order to discharge the liability, issued a cheque dated 24.10.2013, for an amount of Rs.1,79,900/-, which was drawn on HDFC Bank, Indrapuri, Bhopal, got dishonoured with remarks 'stop payment' vide memo dated 29.10.2013. The legal notice of demand dated 06.11.2013, having evoked no response, the complaint dated 02.12.2013 was filed under section 138 of the Negotiable Instruments Act (for short 'the Act') at Hisar, where the complainant-company has its registered office. The trial Court, after recording preliminary evidence, passed the summoning order dated 02.03.2014. However, respondents-company did not appear, leading to issuance of bailable warrants to secure their presence. The complaint was however, returned in original vide order dated 17.10.2014, in view of the judgment of Hon'ble The Supreme Court in Dashrath Rupsingh Rathod v. State of Maharashtra and another , Criminal Appeal No.2287 of 2009 for its presentation before the learned Court where the drawee bank is situated.

3. Learned counsel for the petitioner would submit that though the complaint ought not to have been returned, as the cheque in question was payable at par and the drawee is situated in the city, wherein it was presented. However, now by way of an amendment carried out in the Act by incorporating Section 142A vide Notification dated 15.06.2015, the complaint could have been presented where the cheque was presented for collection that is the branch of the Bank of payee or holder in due course. To bolster his submission, he relies on Bridgestone India Pvt. Ltd. v. Inderpal Singh, (2016) 2 SCC 75, and Paramvir Singh Mor v. Professional Placements Pvt. Ltd and another, CRM- M-39975-2016, decided on 19.07.2022.

4. According to the office report, none has appeared on behalf of the respondents, in the present case. As is apparent, that despite bailable warrants having been issued against the respondents, they had not caused an appearance before the learned trial Court as well. In view of which, it would be in the interest of justice to not keep the case pending any longer, thereby, is decided as per the amendment and the law laid down.

5. Heard.

6. It is apposite to refer to the relevant portion of Negotiable Instruments (Amendment) Second Ordinance, 2015 for consideration of the case in hand, which reads thus

    "3. In the principal Act, section 142 shall be numbered as sub-section (1) thereof and after subsection (1) as so numbered, the following sub-section shall be inserted, namely:-

    "(2) The offence under section 138 shall be inquired into and tried only by a court within whose local jurisdiction,--

    (a) if the cheque is delivered for collection through an account, the branch of the bank where the payee or holder in due course, as the case may be, maintains the account, is situated; or

    (b) if the cheque is presented for payment by the payee or holder in due course otherwise through an account, the branch of the drawee bank where the drawer maintains the account, is situated.

    Explanation - For the purposes of clause

    (a), where a cheque is delivered for collection at any branch of the bank of the

              Click Here to Read the rest of this document
              1
              2
              3
              4
              5
              6
              7
              8
              9
              10
              11
              SupremeToday Portrait Ad
              supreme today icon
              logo-black

              An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers

              Please visit our Training & Support
              Center or Contact Us for assistance

              qr

              Scan Me!

              India’s Legal research and Law Firm App, Download now!

              For Daily Legal Updates, Join us on :

              whatsapp-icon Back to top