138 FILED AT DELHI
Soma
(Querist) 18 November 2009
This query is : Resolved
Client issued a cheque at Kolkata, against loan taken in Kolkata, Cheque dishonoured at Kolkata, Client received demand notice at Kolkata.
138 N I Act case filed at Delhi, court issued warrant. The case admitted on the ground taht the demand notice was send from delhi.
Other Party claimed taht Supreme Court judgment allows such place of suing where from notice has been sent.
Seniors Please advice...any idea of such judgment?
AEJAZ AHMED
(Expert) 18 November 2009
Dear Soma,
A place, for that purpose, would depend upon a variety of factors. It can either be:
i) at the place where the drawer resides
ii)at the place where the payee resides
iii) at the place where either of them carries on business.
iv) at the place Where the cheque was presented for encashment.
v) at the place Where the cheque was returned unpaid by drawee bank.
The offence under Section 138 of the Act can be completed only with the concatenation of a number of acts. Following are the acts which are components of the said offence: (1) Drawing of the cheque, (2) Presentation of the cheque to the bank, (3) Returning the cheque unpaid by the drawee bank, (4) Giving notice in writing to the drawer of the cheque demanding payment of the cheque amount, (5) failure of the drawer to make payment within 15 days of the receipt of the notice.
Thus it is clear, if the five different acts were done in five different localities any one of the courts exercising jurisdiction in one of the five local areas can become the place of trial for the offence under Section 138 of the Act.
The above observations are made in the following Judgment.
{ Vide : K. Bhaskaran v. Sankaran Vaidhyan Balan }
http://www.indiankanoon.org/doc/529907/
H. S. Thukral
(Expert) 18 November 2009
Dear Soma
For latest position of jurisdiction, kindly see Harman Electronics v National Panasonic 2009 (156) DLT 160. The above view has changed and issuance of notice form Delhi shall not confer jurisdiction on Delhi Courts. In view of above society the Delhi High Court Legal Service Committee filed a petition in the High Court to return all complaints which were filed in Delhi on the basis of notice. WP was allowed. I am giving herein the text of the order for your reference
IN THE HIGH COURT OF DELHI AT NEW DELHI
W.P.(C) 11911/2009
DELHI HIGH COURT LEGAL
SERVICES COMMITTEE ..... Petitioner
Through Ms. Jyoti Singh, Advocate
versus
GOVT. OF NCT OF DELHI ..... Respondent
Through Mr. Nazimi Waziri, Advocate
CORAM:
HON'BLE THE CHIEF JUSTICE
HON'BLE MR. JUSTICE MANMOHAN
ORDER
23.09.2009
Petitioner which is a Legal Aid Committee has filed the present writ
petition in public interest under Article 226 of the Constitution of India
praying for issuance of an appropriate writ, order or direction directing return
of all criminal complaints filed under the provisions of Section 138 of
Negotiable Instruments Act, 1881 (hereinafter referred to as NI Act ) that are
pending in the Courts of the Metropolitan Magistrates in Delhi, in which
cognizance has been taken, even though the Metropolitan Magistrates have no
territorial jurisdiction to entertain and try them.
Ms. Jyoti Singh, learned counsel for petitioner stated that a large number
of cases have been filed by various financial institutions, banks and other
complainants under Section 138 of NI Act in Courts of Metropolitan Magistrates
in Delhi regarding dishonour of cheques, without first ascertaining whether the
trial courts in Delhi have territorial jurisdiction in the matter or not.
According to Ms. Singh, in most of the cases, financial institutions/banks have
filed complaints in Delhi only on the ground that the statutory notice of 15
days after dishonour of cheque had been issued from Delhi even though the same
was communicated outside Delhi and further the cause of action also arose
outside the territory of Delhi. She stated that in many cases, financial
institutions/other complainants for their own convenience have filed complaints
in Delhi even though the accused are staying in far off States like Kerala in
South India.
Ms. Singh submitted that the Supreme Court in Harnam Electronics Pvt. Ltd.
Vs. National Panasonic India Pvt. Ltd. reported in 2009 (1) SCC 720 has held
that mere issuance of a notice from Delhi will not confer territorial
jurisdiction on the Courts in Delhi to entertain a complaint under Section 138
of NI Act, as it would by itself not give rise to a cause of action.
Ms Singh stated that following the aforesaid judgment, Metropolitan
Magistrates of Delhi had dismissed many complaints where the Courts at Delhi did
not have territorial jurisdiction. She further stated that the Metropolitan
Magistrates suo moto also dismissed certain complaints where they had already
issued summons earlier, though erroneously. She submitted that the financial
institutions aggrieved by the said orders of Metropolitan Magistrates filed
several criminal revisions before this Court.
Ms. Singh stated that a learned Single Judge of this Court decided a batch
of matters vide common judgment dated 15th May, 2009 in the case of ICICI Bank
Ltd. Vs. Subhash Chand Bansal reported in 2009 (160) DLT 379. In cases where
learned Metropolitan Magistrates had dismissed the complaint at the very
threshold and initial stage, without issuing notice, the learned Single Judge
held that I am in respectful agreement with the above said ratio of the
decision in the case of M/s. Harnam Electronics . After holding so the learned
Single Judge upheld the order of trial court returning the complaints on the
ground of lack of territorial jurisdiction. In respect of cases, where learned
Metropolitan Magistrates had suo moto dismissed complaints and in cases where
summons had already been issued, the learned Single Judge while relying upon
Adalat Prashad Rooplal Vs. Jindal and Ors. reported in 2004 (7) SCC 338 held
after taking cognizance of the offence under Negotiable Instruments Act, 1881
it is not open to them to suo moto throw out the criminal complaints abruptly by
declaring that they do not have territorial jurisdiction to deal with the
matter. Adoption of such a course is strictly prohibited by the Apex Court in
the case of Adalat Prashad .
According to Ms. Singh, the effect of the said judgment is that the
Metropolitan Magistrates are not able to suo moto dismiss/return the complaints
in which they do not have territorial jurisdiction as they have already issued
summons to the accused and they do not have the power to review/recall their
order. Ms. Singh stated that the effect of the said course of action is that
the Courts of Metropolitan Magistrates are flooded with complaints unnecessarily
though they have no territorial jurisdiction. In this context, she referred to
cause list of various Metropolitan Magistrates in Delhi. She submitted that
disposal of such complaints also takes a lot of time as in most of the matters
the accused are either not served and even in cases where they are served, they
do not appear before the Court because the amount involved is so small that
accused thinks that he would have to spend more money in reaching Delhi and
contesting the matter. Therefore, according to her, the matters remain pending
and consume a lot of time of the Court. She submitted that as a result,
pendency is increasing and courts below are burdened with cases in which they
have no jurisdiction.
Mr. Nazimi Waziri, learned standing counsel for GNCT of Delhi stated that
he has no objection to the relief as prayed for being granted by this Court.
It is settled law that Article 226 of the Constitution confers
extraordinary jurisdiction on the High Courts to issue high prerogative writs
for enforcement of fundamental rights or for any other purpose. The power is
wide and expansive. The Supreme Court in Dwarka Nath Vs. Income-Tax Officer and
Anr. reported in AIR 1966 SC 81 has held as under :-
(4) This article is couched in comprehensive phraseology and it ex facie
confers a wide power on the High Courts to reach injustice wherever it is found.
The Constitution designedly used a wide language in describing the nature of the
power, the purposes for which and the person or authority against whom it can be
exercised. It can issue writs in the nature of prerogative writs as understood
in England; but the scope of those writs also is widened by the use of the
expression ``nature'`, for the said expression does not equate the writs that
can be issued in India with those in England, but only draws in analogy from
them. That apart, High Courts can also issue directions, orders or writs other
than the prerogative writs. It enables the High Courts to mould the reliefs to
meet the peculiar and complicated requirements of this country. Any attempt to
equate the scope of the power of the High Court under Art. 226 of the
Constitution with that of the English Courts to issue prerogative writs is to
introduce the unnecessary procedural restrictions grown over the years in a
comparatively small country like England with a unitary form of Government to a
vast country like India functioning under a federal structure. Such a
construction defeats the purpose of the article itself. To say this is not to
say that the High Courts can function arbitrarily under this Article. Some
limitations are implicit in the article and others may be evolved to direct the
article through defined channels. This interpretation has been accepted by this
Court in T. C. Basappa v. Nagappa, 1955-1 SCR 250: (AIR 1954 SC 440) and Irani
v. State of Madras, 1962-(2) SCR 169 : (AIR 1961 SC 1731).
Further the Supreme Court in Air India Statutory Corporation reported in
1997 (9) SCC 377 has held that :-
59. The Founding Fathers placed no limitation or fetters on the power of the
High Court under Article 226 of the Constitution except self-imposed
limitations. The arm of the Court is long enough to reach injustice wherever it
is found. The Court as sentinel on the qui vive is to mete out justice in given
facts
The Constitution does not place any fetter on exercise of extraordinary
jurisdiction, which certainly can be invoked in the present situation where
courts are flooded with complaints which they can neither entertain nor return
and the pendency of such complaints is unnecessarily clogging the dockets of the
subordinate courts. In fact, Metropolitan Magistrates are not able to dispose
of other cases which are within their jurisdiction, as their cause lists are
flooded with these Section 138 NI Act matters which are beyond their
jurisdiction. It is pertinent to mention that work in respect of these Section
138 NIA matters where Delhi courts have no territorial jurisdiction, has come to
a virtual standstill and the accused are suffering harassment as they have to
travel long distances at heavy costs to defend their cases. Consequently,
retention of these Section 138 NI Act matters violates fundamental and legal
rights of the accused not only in these cases but also in other cases.
Undoubtedly, right to speedy justice without harassment is also a facet of
Article 21 of Constitution of India.
In any event, the High Court under Article 226 of the Constitution is
required to enforce law of the land and in accordance with the judgment of
Supreme Court in M/s. Harnam Electronics s (supra), all pending complaints in
courts having no jurisdiction have to be returned.
Consequently, in exercise of power under Article 226 of the Constitution
read with Section 482 of Code of Criminal Procedure, we direct return to the
complainants for presentation in the Court of competent jurisdiction all those
criminal complaints filed under Section 138 of NI Act that are pending in the
courts of Metropolitan Magistrates in Delhi in which cognizance has been taken
by them without actually having territorial jurisdiction.
With the aforesaid directions, present petition is allowed.
CHIEF JUSTICE
MANMOHAN, J
SEPTEMBER 23, 2009
rn
Raj Kumar Makkad
(Expert) 18 November 2009
Latest law shall prevail so Delhi is not the proper place to sue in the given case but this can be agitated before the appellate court now because th trial court has already denied the plea of the accused.
Soma
(Querist) 18 November 2009
Attn: Harbhajan Singh Thukral
Sir, Thanks for your kind explanation and time spend for me ...Thanks again to all other seniors too....
Sachin Bhatia
(Expert) 22 November 2009
Well advised by Mr.Ahmed & Mr.Thukral
