IN THE HIGH COURT OF JUDICATURE AT PATNA
Criminal Miscellaneous No.25296 of 2017
Arising Out of PS.Case No. -2227 Year- 2013 Thana –
BHAGALPUR COMPLAINT CASE District- BHAGALPUR
Minaj Hussain @ Meer Minaj Ahmad @ Meer Minaj Hussain Son of
Meer Irfan Ali, Resident of Village-Tirmuhani, P.O. P.S.-
Amdabad, District-Katihar. (accused)
…. …. Petitioner/s
Versus
1. The State of Bihar
2. Rajeev Upadhyay, Son of Late Ramashankar Upadhyay,C/o-Sri
Tej Narayan Mishra, Resident of Village P.O.-Maheshmunda,
P.S.-Kahalgaon, District-Bhagalpur. (Complainant)
…. …. Opposite Party/s
Appearance :
For the Petitioner/s : Mr. Diwakar Upadhyaya
For the Opposite Party/s : Mr. Sri. Kumar Virendra Narayan
CORAM: HONOURABLE MR. JUSTICE ASHUTOSH KUMAR
CAV JUDGMENT
Date: 06-04-2018
The petitioner has challenged the order dated
05.01.2017 passed by the learned A.C.J.M-XIV, Bhagalpur in
connection with Complaint Case No. 2227 of 2013 whereby the
prayer made on behalf of the petitioner for transferring the
case from Bhagalpur to Katihar on the ground of territorial
jurisdiction has been rejected.
2. Rajeev Upadhyay/O.P. No. 2 had lodged a
complaint vide Complaint Case No. 2227 of 2013 before the
learned Chief Judicial Magistrate, Bhagalpur alleging that the
petitioner had taken money from him which was paid to him by
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cheque for the purposes of expanding the joint business. When
the complainant/O.P. No. 2 felt that the business was not
improving, he demanded his money back. The petitioner, it has
been alleged, tried to return the amount to the complainant/
O.P. No. 2 vide three cheques, the first being a cheque drawn
on Punjab National Bank, Daulat Ram Chauk, Katihar for the
amount of Rs. 11,00,000/-(eleven lakhs); the second cheque
being drawn on Central Bank of India, Katihar for the amount
of Rs. 11,00,000/-(eleven lakhs) and the third cheque again of
Rs. 11,00,000/-(eleven lakhs) drawn on Bank of Baroda,
Katihar Branch.
3. On presentation of the aforesaid cheques in the
account of complainant/O.P. No. 2, the cheques could not be
honoured because of insufficient funds. Even after notice to the
petitioner/accused, no money was forthcoming; hence the
instant complaint was lodged.
4. It further appears from the records that
complainant/O.P. No. 2 had also filed a Police Case at Katihar
vide Katihar (Town) P.S. Case No. 140 of 2010 instituted for
the offences under Sections 420, 406, 465, 468, 471, 506,
120(B) of the Indian Penal Code against the petitioner. The
aforesaid case also relates to the business dispute between the
parties. The aforesaid Police Case is still pending trial at
Katihar. It was thus submitted by the accused/petitioner that
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deliberately the complaint case has been filed in Bhagalpur in
order to mount pressure on him for giving to complainant/O.P.
No. 2 the amount which is being claimed by him.
5. Since all the cheques which are stated to have
been issued by the petitioner, have been drawn on branches of
the banks at Katihar, it was requested by the petitioner that all
theses cases be transferred to Katihar Judgeship which would
have the jurisdiction to try those cases and it would also be in
consonance with the principle of forum convenience of the
parties as the other Police Case is also being contested at
Katihar.
6. The aforesaid prayer has been rejected by the
order impugned on the sole ground that the aforesaid cheques
issued by the petitioner/accused were deposited/presented for
encashment at Bhagalpur which gave the sole jurisdiction to a
competent Court at Bhagalpur to try the case.
7. The petitioner has sought to impugn the aforesaid
order on the following grounds.
(a) The cause of action has accrued at Katihar where
the cheques issued by the petitioner have been dishonoured.
(b) The cheques are not stated to be crossed cheques
and therefore, it would be deemed to have been given to the
complainant/O.P. No. 2 for presenting it before the drawer
bank and
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(c) It would be convenient for the parties if the
Complaint Case at Bhagalpur and the Police Case at Katihar
which have been lodged by the complainant/O.P. No. 2, be
tried in the Katihar Judgeship.
8. The aforesaid contentions of the petitioner has
been sought to be repelled by the learned counsel appearing
for the complainant/O.P. No. 2 on the ground that the
amended Section 142 of the Negotiable Instruments Act, 1881
gives the jurisdiction to try the present complaint only at
Bhagalpur, where the cheques were delivered for collection
through an account as the complainant/O.P. No. 2 maintained
an account at Bhagalpur.
9. Section 142 of the amended Negotiable
Instruments Act reads as follows:-
“142. Cognizance of offences.-[(1)]
Notwithstanding anything contained in the Code of
Criminal Procedure, 1973 (2 of 1974),-
(a) no Court shall take cognizance of any offence
punishable under section 138 except upon a
complaint, in writing, made by the payee or, as the
case may be, the holder in due course of the
cheque;
(b) such complaint is made within one month of the
date on which the cause of action arises under
clause (c) of the proviso to section 138:
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[provided that the cognizance of a complaint may
be taken by the Court after the prescribed period, if
the complainant satisfies the Court that he had
sufficient cause for not making a complaint within
such period;]
(c) no Court inferior to that of a Metropolitan
Magistrate or a Judicial Magistrate of the first class
shall try any offence punishable under section 138.]
[(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 payee or holder in due course, then,
the cueque shall be deemed to have been delivered
to the branch of the bank in which the payee or
holder in due course, as the case may be, maintains
the account.]”
(emphasis provided)
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10. Sub-clause 2 of Section 142 has been added by
act 26 of 2015 and it has been made effective with effect from
15.06.2015.
11. Prior to the amendment referred to above, the
view which was prevalent with respect to the jurisdiction was
that the locality where the bank (which dishonoured the
cheque) is situated would not be the only place for suing;
rather, it could be either at the place where the drawer resides
or at the place where the payee resides or at the place where
either of them carries on business. Hence, there was difficulty
to fix any particular locality as the place of occurrence for the
offence under Section 138 of the Negotiable Instruments Act.
12. For the sake of completeness, Section 138 of the
Negotiable Instruments Act is being extracted below.
“138. Dishonour of cheque for insufficiency,
etc., of funds in the account.- Where any cheque
drawn by a person on an account maintained by
him with a banker for payment of any amount of
money to another person from out of that account
for the discharge, in whole or in part, of any debt or
other liability, is returned by the bank unpaid, either
because of the amount of money standing to the
credit of that account is insufficient to honour the
cheque or that it exceeds the amount arranged to
be paid from that account by an agreement made
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with the amount arranged to be paid from that
account by an agreement made with the bank, such
person shall be deemed to have committed an
offence and shall, without prejudice to any other
provision of this Act, be punished with
imprisonment for [a term which may be extended to
two years], or with fine which may extend to twice
the amount of the cheque, or with both:
Provided that nothing contained in this section shall
apply unless-
(a) the cheque has been presented to the bank
within a period of six months* from the date on
which it is drawn or within the period of its validity,
whichever is earlier;
(b) the payee or the holder in due course of the
cheque, as the case may be, makes a demand for
the payment of the said amount of money by giving
a notice in writing to the drawer of the cheque,
[within thirty days] of the receipt of information by
him from the bank regarding the return of the
cheque as unpaid; and
(c) the drawer of such cheque fails to make the
payment of the said amount of money to the payee
or as the case may be, to the holder in due course
of the cheque within fifteen days of the receipt of
the said notice.
Explanation-For the purposes of this section, “debt
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or other liability” means a legally enforceable debt
or other liability.”
13. The pre-requisites for initiating a proceeding
under Section 13 of the Negotiable Instruments Act, therefore
is: (i) issuance of the cheque; (ii) presentation of the cheque to
the bank; (iii) retaining the cheque unpaid to the drawer bank;
(iv) giving notice in writing to the drawer of the cheque
demanding payment of the cheque amount and; (v) failure of
the drawer to make payment within fifteen days of the receipt
of the notice.
14. The prevalent view as indicated above was that it
was not necessary that all the above acts should have taken
place at the same locality/place; rather it could have been
effected at different locations. Since the combination of all the
above requirements/facts was considered to be essential for
completion of the offence under Section 138 of the Negotiable
Instruments Act, therefore, in tune with the provisions
contained in Section 177, 178 and 179 of the Code of Criminal
Procedure, which deals with jurisdiction of the criminal Courts
in enquiry and trials, the court having jurisdiction in anyone of
the five areas where different ingredients of the offence under
Section 138 of the Negotiable Instruments Act, 1881 may have
been committed, could exercise the territorial jurisdiction with
respect to anyone of those conditions ingredients.
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15. For easy reference Sections 177, 178 and 179 of
the Code of Criminal Procedure, 1973 are extracted below.
“177. Ordinary place of inquiry and trial.-Every
offence shall ordinarily be inquired into and tried by
a Court within whose local jurisdiction it was
committed.
178. Place of inquiry or trial.-(a) When it is
uncertain in which of several local areas an offence
was committed, or
(b) where an offence is committed partly in one
local area and partly in another, or
(c) where an offence is a continuing one, and
continues to be committed in more local areas than
one, or
(d) where it consists of several acts done in
different local areas, it may be inquired into or tried
by a Court having jurisdiction over any of such local
areas.
179. Offence triable where act is done or
consequence ensues.-When an act is an offence
by reason of anything which has been done and of a
consequence which has ensued, the offence may be
inquired into or tried by a Court within whose local
jurisdiction such thing has been done or such
consequence has ensued.
16. In K. Bhaskaran versus Sankaran Vaidhyan
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Balan and Another (1999) 7 SCC 510, the Supreme Court
held that a complainant can chose anyone of the Courts having
jurisdiction over anyone of the local areas within the territorial
limits in which anyone of the five acts may have been
committed. It was felt by the Supreme Court that as the
amptitude stood so widened and expansive, it would only be an
idle exercise to raise jurisdictional question regarding the
offence under Section 138 of the Negotiable Instruments Act.
17. However, a departure was made by the Supreme
Court in its approach in Harman Electronics Private Limited
and Another versus National Panasonic India Private
Limited (2009) 1 SCC 720. In the aforesaid case, the
Supreme Court examined the question of jurisdiction under a
situation when the appellant before it was from Chandigarh,
who had issued a cheque drawn on a bank at Chandigarh which
was dishonoured. Notice of payment of the dishonoured cheque
was issued from the Head Office of the complainant at Delhi
and on failure of the appellant to pay the money within 15 days
of the notice, complaint was filed in Delhi.
18. Ordinarily, the Courts below, in view of the
judgment in K Bhaskaran (supra) held that Delhi Court had
jurisdiction to try the complaint. However, the drawer/appellant
contended that Chandigarh Court only had the jurisdiction to
try the case. The Supreme Court, but held that a Court derives
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its jurisdiction when a cause of action arises and such
jurisdiction cannot be conferred on or for any act of omission
on the part of the accused. It further held that the receipt of
notice and not issuance of notice will give rise to cause of
action. This led the Supreme Court deliver that Delhi Court will
not have the jurisdiction to try the case.
19. In view of the different strand of thinking in the
two cases referred to above, viz. K. Bhaskaran (Supra) and
Harman Electronics Private Limited (supra), the Supreme
Court, in Dashrath Rupsingh Rathod versus State of
Maharashtra and Another (2014) 9 SCC 129 held that
giving such an expansive interpretation to the provision of
jurisdiction for trying cases under Section 138 of the Negotiable
Instruments Act, 1881 would only result in rampant abuse and
misuse of the law, to the detriment and adversity of the drawer
of a cheque with relative ease. An unbridled/unrestricted power
lay in the hands of a payee to confer single-handedly
jurisdiction to a Court at a place of his convenience.
20. After going through various provisions of law and
earlier cases in that regard, the supreme Court in Dashrath
Rupsingh Rathod (Supra) held that the territorial jurisdiction for
trying the case under Section 138 of the Negotiable
Instruments Act, 1881 would be exclusively determined by the
place/location of the offence. The return of the cheque by the
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drawer bank would only constitute offence of the act under
Section 138 of the Negotiable Instruments Act, 1881. Hence,
the Courts within which drawer bank is located will only have
the jurisdiction to try the case.
21. However, with the aforesaid judgment, some
difficulty arose with the modern banking system. Traditionally,
the cheques travelled from the bank where they were
presented to the drawer bank branch. In the modern day
banking, the cheques do not travel to drawer bank. It was also
felt that from the equity point of view, the jurisdictional issue
needed a clarification.
22. Hence, the amendment under Section 142(2) of
the Negotiable Instruments Act was brought about.
23. The amendment in the act virtually supersedes
the decision of the Supreme Court in Dashrath Rupsingh
Rathod (Supra). Now, with the amendment of Section 142 of
the Negotiable Instruments Act, the Court having jurisdiction
over the place where the payee bank is situated and where the
cheque is delivered for collection through an account , shall
have the jurisdiction to try a case under Section 138 of the
Negotiable Instruments Act, 1881. However, if the cheque is
presented by the payee, otherwise through an account , i.e.
over the counter, the jurisdiction would be of the Court where
the drawer bank is situated.
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24. The explanation added to Section 142(2) of the
N.I. Act further clarifies the issue.
25. Thus, with the amendment in the act referred to
above, since the cheques in question in the case in hand were
presented at Bhagalpur in the bank account of O.P. No. 2, only
the Court at Bhagalpur shall have the jurisdiction to try the
instant complaint.
26. In Bridgestone India Private Limited versus
Inderpal Singh (2016) 2 SCC 75, the appellant before the
Supreme Court (payee or holder in due course) had lodged a
case at Indore for dishonour of the cheque issued by the
accused at Chandigarh, drawn an a bank in Chandigarh. The
Supreme Court, in view of Section 142(2) of the Negotiable
Instruments Act held that the Court at Indore only had the
jurisdiction and not at Chandigarh which was the situs of the
drawer bank.
27. So far generally with respect to jurisdiction.
28. Now over to the other ground raised by the
petitioner that since the cheques were not crossed, it would be
expected that they would be presented for encashment over
the counter which could only be done at the drawer bank, the
jurisdiction in that case would lie to a Court at Katihar.
29. Chapter XIV of the Negotiable Instruments Act
1881 deals with crossed cheques.
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30. A cheque is said to be crossed generally if it bears
across its face, an addition of the words “and company” or any
abbreviation thereof between two parallel transverse lines, or
of two parallel transverse lines shall be either with or without
the words “not negotiable”. If the name of the banker is added,
the cheque is said to be specially crossed.
31. According to Section 125 of the Act, the holder of
the cheque may cross it generally or specially. In that event,
even if a cheque is un-crossed, if it is presented in the drawee
bank (payee bank), it is aimed at getting encashed through the
account only.
32. In that event, there is no option for the
complainant or the accused to seek or confer jurisdiction on
any other Court except the Court within whose territorial
jurisdiction, the payee bank where the cheque has been
presented, is located.
33. It may also be added here that the present
petition has been filed under Section 407 of the Code of
Criminal Procedure, thus necessitating a discussion on the issue
of forum convenience. The criminal case/police case lodged by
the complainant/O.P. No. 2 may be against the petitioner only
but that case operates in a different field, for a different offence
or set of offences. The O.P. No. 2 has deliberately chosen to file
a complaint at Bhagalpur where he maintains an account in
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which the cheques were presented and seeks to oppose the
present petition as well.
34. In that view of the matter, it would only be forum
non-convenience for the parties for this Court to interfere.
35. Finding no merit in this application, it is
dismissed.
(Ashutosh Kumar, J)
Shageer/-
AFR/NAFR AFR
CAV DATE 28.03.2018
Uploading Date 07/04/2018
Transmission 07/04/2018
Date
