Territorial jurisdiction of court in cheque dishonour case-latest judgment

A plain reading of the orders passed by the High Court would show that the judgment proceeds entirely on the authority of the decision of this Court in K. Bhaskaran's case (supra). That decision has been reversed by this Court in Dashrath Rupsingh Rathod v. State of Maharashtra and Anr.MANU/SC/0655/2014 : (2014) 9 SCALE 97. This Court has, on an elaborate consideration of the provision of Section 138 and the law on the subject, held that presentation of a cheque for collection on the drawee bank or issue of a notice from a place of the choice of the complainant would not by themselves confer jurisdiction upon the Courts where cheque is presented for collection or the default notice issued demanding payment from the drawer of the cheque. Following the said decision we have no hesitation in holding that the High Court was wrong in interfering with the order passed by the Sessions Judge.

IN THE SUPREME COURT OF INDIA

Criminal Appeal No. 1914 of 2014 (Arising out of S.L.P. (Crl.) No. 690 of 2011), Criminal Appeal No. 1915 of 2014 (Arising out of S.L.P. (Crl.) No. 718 of 2011) and Criminal Appeal No. 1916 of 2014 (Arising out of S.L.P. (Crl.) No. 749 of 2011)

Decided On: 04.09.2014

Appellants: K.K. Polycolor India Ltd.
Vs.
Respondent: Global Trade Fin. Ltd.

Hon'ble Judges/Coram:T.S. Thakur, V. Gopala Gowda and C. Nagappan, JJ.

Citation: iv(2014)BC206(SC), 2014(4)BomCR(Cri)61, 2014(10)SCALE297,(2014)9 scc225

2. These appeals arise out of an order dated 15th September, 2010 passed by the High Court of Judicature at Bombay whereby Crl. Application Nos. 1491, 2759 and 2760 of 2010 have been allowed and the orders passed by the Magistrate set aside and the matter remitted back to the Magistrate with the direction that the criminal complaints filed by the complainants-Respondents herein shall be disposed of expeditiously.

3. Complaints Under Section 138 of the Negotiable Instrument Act, 1880 appear to have been filed by the Respondent-company in the Court of Metropolitan Magistrate, Bandra which were entertained by the Magistrate and process issued against the accused persons. Revision applications were then filed before the Court of Sessions at Bombay challenging the jurisdiction of the Magistrate to entertain the complaints. The Revisional Court relying upon Harman Electronics Private Limited and Anr. v. National Panasonic India Private Limited MANU/SC/8405/2008 : (2009) 1 SCC 720 held that the Magistrate did not have the jurisdiction to entertain the complaints. The orders passed by the Magistrate were set aside and the complaints directed to be returned for presentation before the competent Court. Aggrieved by the said orders the complainant preferred Criminal Applications No. 1491, 2759 and 2760 of 2010 before the High Court who relying upon the decision of this Court in K. Bhaskaran v. Sankaran Vaidhyan Balan MANU/SC/0625/1999 : (1999) 7 SCC 510 and three other decisions of the Bombay High Court held that the Magistrate had the jurisdiction to entertain the complaint as the cheque had been presented before a bank at Bombay which fact was, according to the High Court, sufficient to confer jurisdiction upon the Magistrate to entertain the complaints and try the cases. The orders passed by the Revisional Court were accordingly set aside and the Magistrate directed to proceed with the trial of the cases expeditiously as already noticed. The present special leave petitions have been filed by the accused persons assailing the view taken by the High Court.

4. A plain reading of the orders passed by the High Court would show that the judgment proceeds entirely on the authority of the decision of this Court in K. Bhaskaran's case (supra). That decision has been reversed by this Court in Dashrath Rupsingh Rathod v. State of Maharashtra and Anr.MANU/SC/0655/2014 : (2014) 9 SCALE 97. This Court has, on an elaborate consideration of the provision of Section 138 and the law on the subject, held that presentation of a cheque for collection on the drawee bank or issue of a notice from a place of the choice of the complainant would not by themselves confer jurisdiction upon the Courts where cheque is presented for collection or the default notice issued demanding payment from the drawer of the cheque. Following the said decision we have no hesitation in holding that the High Court was wrong in interfering with the order passed by the Sessions Judge.

5. We accordingly allow these appeals and set aside the order passed by the High Court and restore those passed by the Revisional Court. The parties are, however, left to bear their own costs.

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