Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2025 Supreme(Online)(SC) 10596

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION
Surya Kant, Joymalya Bagchi, JJ
Golla Naraesh Kumar Yadav – Appellant
Versus
Kotak Mahindra Bank – Respondent
TRANSFER PETITION (CRL.) Nos.204-205 of 2025

Advocates:
For the Appellants/Petitioners: Mr. P. Mohith Rao, Ms. J. Akshitha, Mr. Eugene S Philomene
For the Respondents: Mr. Palash Singhai

The court recognized the balance of convenience in transferring cases under the Negotiable Instruments Act, especially when disparities exist between the parties' economic strengths.

Headnote:(A) Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 - Section 13 - Negotiable Instruments Act, 1881 - Sections 138, 139, 142 and 142A - Transfer of criminal cases - Petitioner(s) sought transfer of proceedings from Chandigarh to Hyderabad due to convenience and distance - Court held that relative inconvenience of parties must be considered, especially where complainant is a large bank and accused a small borrower. (Paras 1-26)

(B) Jurisdiction - Transfer under Section 138 of N.I. Act - Importance of jurisdiction based on locality where the cheque is presented - The amendment in law reflects intent to facilitate payee’s convenience, however, the Court retains the authority to transfer for justice. (Paras 8-12)

Facts of the case:
The petitioners obtained loans from the respondent bank but their accounts turned into Non-Performing Assets, leading to criminal proceedings for cheque dishonour - Petitioners argued transfer was necessary for convenience as they faced challenges in Chandigarh.

Findings of Court:
The Court acknowledged the unequal status between the small-time debtor and a large bank, suggesting transfer to Hyderabad where related proceedings were ongoing.

Issues: The central issue was whether inconvenience to the accused justified transfer of the case venue from Chandigarh to another court.

Ratio Decidendi: The court found that the balance of convenience tipped in favor of the accused, justifying the transfer to avoid a significant disadvantage.

Result: Proceedings transferred to the Court of Chief Metropolitan Magistrate, Hyderabad.

Judgement Key Points

न्यायिक मजिस्ट्रेटों के लिए दिशा-निर्देश:

स्थानांतरण याचिकाओं का निर्णय लेते समय सुविधा का संतुलन और असमान आर्थिक शक्ति या भौगोलिक दूरी वाले पक्षों की कठिनाइयों पर विचार करें, विशेष रूप से सेक्शन 138 के तहत मामलों में (!) (!) ।
यह मूल्यांकन करें कि मुख्य रूप से लेन-देन कहाँ हुआ, चेक प्रस्तुत करने का स्थान क्या है, और पक्षों सहित गवाहों एवं कानूनी प्रतिनिधियों की सुविधा का ध्यान रखें, ताकि क्षेत्राधिकार या स्थानांतरण का निर्णय सही ढंग से लिया जा सके (!) (!) (!) ।
स्थानांतरण याचिकाओं का निर्णय करते समय, उल्लंघनों या कठिनाइयों का समर्थन करने वाले ठोस कारण और सबूत देखें, जैसे कि अनावश्यक कठिनाई, कानूनी सहायता प्राप्त करने में समस्या, या महत्वपूर्ण असुविधा, न कि केवल पसंद या रणनीति (!) (!) ।
विवेक का प्रयोग सावधानीपूर्वक करें, आरोपी के निष्पक्ष परीक्षण का संवैधानिक अधिकार और शिकायतकर्ता व गवाहों की सुविधा को ध्यान में रखते हुए, साथ ही साथ न्याय की त्वरितता के सामान्य सिद्धांत को भी प्राथमिकता दें (!) (!) ।
यदि मामला मामूली अपराधों या अर्ध-क्रिमिनल प्रकृति का है, तो आरोपी की सुविधा और निष्पक्ष परीक्षण के अधिकार को प्राथमिकता दें, विशेष रूप से यदि वे सीमित साधनों वाले व्यक्ति हैं, तो बड़े संस्थागत शिकायतकर्ताओं की सुविधा से अधिक ध्यान दें (!) (!) ।
स्थानांतरण केवल तभी आदेशित किया जाना चाहिए जब यह "न्याय के उद्देश्य के लिए उपयुक्त" हो, न कि केवल असुविधा या कठिनाई के आधार पर, ताकि संतुलित दृष्टिकोण सुनिश्चित किया जा सके (!) (!) ।
संबंधित मामलों और दस्तावेजों व गवाहों के स्थान का व्यापक संदर्भ में ध्यान रखें, खासकर जब एक ही लेन-देन से संबंधित कई मामले हों, ताकि न्यायिक कार्यवाही कुशल और निष्पक्ष हो सके (!) (!) ।
स्थानांतरण के निर्णय में आरोपी के कानूनी प्रतिनिधित्व, तैयारी और निष्पक्ष परीक्षण के अधिकार पर भी विचार करें, विशेष रूप से यदि वर्तमान स्थान उन्हें कठिनाई में डाल रहा हो या उनके बचाव की क्षमता को प्रभावित कर रहा हो (!) (!) (!) ।
स्थानांतरण का निर्णय स्पष्ट सबूतों पर आधारित हो, जिसमें संभावित न्याय का उल्लंघन या अनुचित प्रभाव का संकेत हो, ताकि न्यायिक प्रक्रिया की अखंडता बनी रहे (!) (!) ।
जब कई अदालतें और लंबित कार्यवाही हों, तो उच्च न्यायालयों या संबंधित प्राधिकरणों के साथ समन्वय करें, ताकि स्थिरता और न्यायिक अनुशासन बना रहे, और यदि आवश्यक हो तो जटिल मुद्दों को बड़े पीठ के समक्ष प्रस्तुत करें (!) (!) ।
स्थानांतरण के निर्णय को पारदर्शी रूप से दस्तावेजित करें, जिसमें न्याय, निष्पक्षता और त्वरितता के सिद्धांतों को रेखांकित किया गया हो, और यदि आवश्यक हो तो ऐसे मामलों को उच्च प्राधिकारी के समक्ष प्रस्तुत करें (!) ।

ये दिशानिर्देश न्याय, निष्पक्षता और कार्यक्षमता के सिद्धांतों का पालन करते हुए सेक्शन 138 के तहत स्थानांतरण याचिकाओं का उचित और संतुलित निर्णय सुनिश्चित करने के लिए बनाए गए हैं, ताकि सभी पक्षों के अधिकार सुरक्षित रहें।

ORDER

1. The transfer petition depicts a David versus Goliath battle between a gargantuan bank having its branches spread throughout the country and a small-time borrower carrying on business in Adoni, District Kurnool, Andhra Pradesh.

FACTUAL MATRIX

2. Petitioner No. 1, Golla Naraesh Kr. Yadav, is proprietor of M/s Hari Cotton Traders and its sister concern, M/s Hari Cotton Ginning Pressing Factory. In 2021-2022, both firms obtained overdraft and loan facilities to the tune of Rs. 3 crores and Rs. 7 crores, respectively, from the respondent Bank through its branch at Adoni. Petitioners stood as Signature Not Verified guarantors and issued cheques in favour of the respondent Bank. In Digitaly signed by NITIN TALREJA Date: 2025.12.05 Reason: the course of business, it is alleged the overdraft facility was not serviced, and in April 2023, the Bank declared the account as a Non- Performing Asset (NPA).

3. Respondent Bank initiated proceedings under the SARFAESI Act, 2002, Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 . which were challenged by the petitioners before the Debt Recovery Tribunal at Hyderabad, S.A. No. 397 of 2023. Hereinafter, ‘SARFAESI Act’.(DRT). Respondent Bank also instituted OA No. 787 of 2023 under Section 19(4) of Recovery of Debts and Bankruptcy Act, 1993 , Hereinafter, ‘RDB Act’. before the DRT. Proceedings were also instituted before the High Court of Andhra Pradesh challenging the respondent Bank’s decision to declare the firm’s account as NPA, W.P. No. 16295 of 2024.

4. In the meanwhile, cheques issued by Petitioner No.(s) 1 and 2, amounting to Rs.3 crores and Rs.6 crores respectively, drawn on their accounts maintained at Adoni branch of HDFC Bank and respondent Bank, were presented by respondent Bank at Chandigarh. Upon dishonour of the said cheques, subject criminal proceedings, Complaint No. 23195 of 2023 and Complaint No. 23197 of 2023. under Section 138 of the Negotiable Instruments Act, 1881 , Hereinafter, ‘N.I. Act’. were instituted before Court of Chief Judicial Magistrate, Chandigarh.

5. This has prompted the petitioners to approach this Court praying for transfer of the said cases from Chief Judicial Magistrate, Chandigarh to the Court of Metropolitan Magistrate, Adoni, Kurnool, Andhra Pradesh.

ARGUMENTS AT THE BAR

6. In support of such prayer, petitioners contend the entire transaction between the parties took place at Andhra Pradesh and a number of proceedings arising out of the same transaction are pending inter se at DRT, Hyderabad and in the High Court of Andhra Pradesh. Petitioners further contend continuation of the said proceedings in Chandigarh would cause irreparable injury to them, as they would have to travel a distance of over 2000 km and would find it di cult to secure legal assistance and defend themselves at a far-o place where the proceedings are conducted in a dierent language.

7. In rebuttal, the respondent Bank referring to Section 142 (2) of N.I. Act contends the prosecutions were instituted in the court within whose territorial jurisdiction the dishonoured cheques were presented for collection and mere inconvenience of distance or language cannot be a ground for transfer. In support of their plea, they rely on Shri Sendhur Agro & Oil Industries vs. Kotak Mahindra Bank Ltd, (2025) SCC OnLine SC 508.

PRINCIPLES GOVERNING TRANSFER OF CASES UNDER SECTION 138 OF N.I. ACT

8. Section 142 of the N.I. Act provides for cognizance of any o ence under Section 138 of the Act. Prior to its amendment in 2015, Post the 2015 amendment, Section 142 was re-numbered as sub-section (1), and sub-section (2) was inserted thereafter. the said provision did not deal with the territorial jurisdiction of the court entitled to try such o ence. Such territorial jurisdiction was to be determined under the general law i.e., Chapter XIII of the Criminal Procedure Code, 1973. Section 177 of the Code, Corresponding to Section 197 BNSS. provides that an o ence

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2025 Supreme(Online)(SC) 10596

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTIONSurya Kant, Joymalya Bagchi, JJGolla Naraesh Kumar Yadav – AppellantVersusKotak Mahindra Bank – RespondentTRANSFER PETITION (CRL.) Nos.204-205 of 2025

The court recognized the balance of convenience in transferring cases under the Negotiable Instruments Act, especially when disparities exist between the parties' economic strengths.

Cases Referred (2)

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION
Surya Kant, Joymalya Bagchi, JJ
Golla Naraesh Kumar Yadav – Appellant
Versus
Kotak Mahindra Bank – Respondent
TRANSFER PETITION (CRL.) Nos.204-205 of 2025