TMI Blog2017 (5) TMI 314X X X X Extracts X X X X X X X X Extracts X X X X ..... n a proceeding instituted upon a complaint made in writing, every summons or warrant issued under sub-section (1) shall be accompanied by a copy of such complaint. The aforesaid provisions make it clear that the Magistrate is required to issue summons for attendance of the accused only on examination of the complaint and on satisfaction that there is sufficient ground for taking cognizance of the offence and that he is competent to take such cognizance of offence. Once the decision is taken and summons is issued, in the absence of a power of review including the inherent power to do so, the remedy lies before the High Court under Section 482 Cr. P.C or under Article 227 of the Constitution of India and not before the Magistrate. Section 201 Cr.P.C., as noticed earlier, can be applied immediately on receipt of a complaint, if the Magistrate is not competent to take cognizance of the offence. Once the Magistrate taking cognizance of an offence forms his opinion that there is sufficient ground for proceeding and issues summons under Section 204 Cr.P.C., there is no question of going back following the procedure under Section 201 Cr.P.C. In the absence of any power of review or r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -D to this application and to pass all incidental and consequential orders as may be deemed fit and proper. (C ) Pending admission, final hearing and disposal of this petition, to stay further proceedings of Criminal Case No.49661 of 2015 pending before the Hon ble Court of 12th Additional Chief Judicial Magistrate, Vadodara. (D) Pending admission, final hearing and disposal of this petition, to stay bailable warrant issued on 05.03.2016 in Criminal Case No.49661 of 2015 by the Hon ble Court of 12th Additional chief Judicial Magistrate, Vadodara. (E) To pass any other and further orders as may be deemed fit and proper in the facts and circumstances of the case and in the interest of justice. (F) To provide for the cost of this application. 5. It appears from the materials on record that the respondent No.2-Gujarat State Fertilizers Chemicals Ltd. filed a complaint in the court of the learned 12th Additional Chief Judicial Magistrate, Vadodara for the dishonour of the cheques bearing numbers as stated in the complaint punishable under section 138 of the N.I. Act. The averments made in the complaint are as under; 1) That the Complainant is a limit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It is also well settled that in addition to their fiduciary duties, the directors also owe a duty of care to the Company not to act negligently in the management of its affairs. A director may be shown to be so placed and to have been so closely and so long associated personally with the management of the Company that he will be deemed to be not merely cognizant of but liable for fraud in the conduct of the business of the Company even through no specific act of dishonesty is proved against him personally. He cannot shut his eyes to what must be obvious to everyone who examines the affairs of the company even superficially. It is enough if his negligence is of such a character as to enable frauds to be committed and loses thereby incurred by the company. It is further stated that all the said Accused are responsible for the conduct of the business of the Accused No.1 Company. It is further stated that directors being members of the board are always aware of the transaction that the accused company has with other parties or companies. In the present case also all the directors were aware about the transactions that the accused company had with the complainant company and all t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d (iii) 943807 dated 29.06.2007 of ₹ 19,59,759/- drawn on Karnataka Bank Ltd., New Delhi Branch. The cheques were issued in favour of the complainant company with an implied assurance that the cheques would be honoured and payment shall be duly made. 7. Despite various correspondences with the Company, the outstanding amount was not cleared and, therefore, the complainant again required and called upon the Accused No.1 company to clear the outstanding but the accused No.1 company informed that it was in financial trouble and therefore, was in no position to clear the outstanding and that the same would be cleared as and when possible. However, all the accused on behalf of the accused No.1 company had impliedly assured clearance upon deposit of the said cheques and recovery of the amount and accordingly, the complainant presented the cheques with its banker viz. Corporation Bank ,New Delhi. Upon presenting the cheques on 17.10.2007, the bank sent the cheques with return memos dated 18.10.2007 which was received by the complainants bank viz. Corporation Bank , New Delhi on 18.10.2007. The corporation Bank had informed the complainant on 18.10.2007 that cheque bearing Nos. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed upon all the accused under the provisions of Negotiable Instruments Act 1881, all the accused deliberately did not make any arrangement towards clearance of the said cheques and have given evasive reply not tenable in the eye of law, only with a view to avoid discharging the admitted debts and liability, that all the accused owed towards the complainant. All the accused had replied vide reply of notice dated 24.11.2007 which was received by the advocate of the complainant on 28.11.2007, through their advocates Op. Khaitan and Co. Further, all the accused had issued Corrigendum dated 28.11.2007 to clear certain typographical error of their earlier reply dated 24.11.2007, which was received by the advocate of the complainant on 1.12.2007. All the replies are false, frivolous and misleading. The reply as aforesaid is issued with a view to frustrate the trust in the commercial transaction and is advanced only with a view to abuse the process of law and to avoid making payments towards admitted legal debts and liability. It is further stated that as aforesaid all the accused are actively involved in the conduct of the business of the accused company and all accused are re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate, Vadodara. 9. It is the case of the applicants that the complaints, for the dishonour of the cheques, could not have been filed in the court of the 12th Additional Chief Judicial Magistrate, Vadodara as the territorial jurisdiction to try the complaints would be with the court at New Delhi. This is the sum and substance of all the applications on hand. Submissions on behalf of the applicants: 10. 10. Mr. Deven Parikh, the learned senior counsel appearing for the applicants has filed his submissions in writing. The submissions are as under; 10.1 A perusal of Section 142(2) demonstrates that it is in two parts. It either gives jurisdiction to the Court where the payees bank is situated or where the drawees bank is situated. In the facts of the present case, the jurisdiction is of the Court where the drawees bank (applicant s bank) is situated. 10.2 Section 142(2)(a) read with the explanation confers jurisdiction to the former whereas Section 142(2)(b) confers jurisdiction to the latter. 10.3 Section 142(2)(a) deals with the situation where any kind of cheque is sent for collection through an account of the payee. The account referred to is obviously the pay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other branch of Bank of Baroda, anywhere in the Country. Clearly, therefore, this is not a case falling under 142(2)(a) or the explanation. 10.10 The GSFC has not chosen to use its bank or its bank account but has chosen its independent agreement and arrangement with the Corporation Bank, New Delhi for the purpose of deposit and presentation of the cheque. Such a situation falls under 142(2)(b). 10..11 The GSFC S detailed arrangement with the Corporation Bank, New Delhi is demonstrated by the documents from page 45 to 63 of the further Affidavit filed by the GSFC itself. The following salient features emerge: a). The arrangement needs a separate Board Resolution (page 45), a separate exposure and credit limit (page 51), copies of income tax orders, display boards of the charge of Corporation Bank on the assets of the Company, submission of yearly audited accounts, etc. (page 53), which demonstrates a complete independent transaction between GSFC and Corporation Bank, New Delhi. b). A separate customer code is granted by Corporation Bank to GSFC (page 57). c). As soon as the cheque is deposited, Corporation Bank immediately transfers the money to the Bank of Baroda Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... payee s account. The present is one such arrangement in the modern banking world. 10.13. All such arrangements where the payee does not use his account or his bank will fall under Section 142(2)(b). 10.14. The argument that Section 142(2)(b) deals with the bearer cheques whereas Section 142(2)(a) deals with cross or cross order cheques is clearly not palatable. 10.15. Nothing stopped the legislature from providing that Section 142(2)(b) deals with the bearer cheques. The absence of such language demonstrates that the legislature wanted to cover all kinds of situations where a cheque is presented otherwise than through an account. 10.16 More importantly a scheme of the Negotiable Instruments Act and more Specifically Sections 5, 64, 123 and 126 make no distinction between a bearer cheque or a cross cheque, so far as they are considered to be a negotiable instrument or a bill of exchange. Both kind of cheques are required to be presented for payments (Section 64). The only difference is to whom the bank should pay. (Section 126). However, the presentation for payment is to be done for both the cheques. Thus, the mere use of the words presented for payment in Clause (b) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... heque was deposited in their own account of lClCI bank or in any other branch of their bank. 10.22. The aforesaid judgment has no application to Section 142(2)(b). inasmuch as the said Sub-Section was not being considered. The observations cannot be taken to be an absolute proposition of law laid down in the context of the said sub-section. 10.23. When the Court was not dealing with the said sub- section, the judgment cannot be read as if the court was considering all the possibilities that may ever fall under the said sub-section. The Court only gave an example that the situation where a bearer cheque is presented over the counter could be a situation falling under 142(2)(b). The court started giving an example on page 12 and in continuation thereof, gave an illustration that when the cheque is presented over the counter would be one of the situations covered under 142(2)(b). Having given this illustration, the same illustration was continued at the end of the judgment on page 27. 10.24. It is submitted that by no stretch of imagination can it be suggested that the court was seeking to lay down any and every possible situation that would be covered under the said sub-sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the Corporation Bank with which the Complainant has entered into arrangement of Fast Collection Services (FCS). Under this arrangement, the Complainant has to deposit the cheques for collection at any of the operating branches of the Corporation Bank. The Corporation Bank has assigned a Customer Code (GFC 563) . All the cheques delivered for collection to the Corporation Bank would be reflected in the Account of the complainant. On the amount being collected, the collection would get credited in the Pooled Account No. 02090500000002 with the Pooling Branch of Bank of Baroda. 12.2. On such facts, the case clearly falls under Section 142(2)(a). Section 142(2) seeks to define the jurisdiction to try offences under section 138 of dishonoured cheques. The jurisdiction is defined and demarcated by reference to the mode of collection. 12.3. The Act contemplates two modes of collection; viz - through an account and (ii) otherwise through an account i.e. over the counter. 12.4(I) In all cases where the cheques are delivered for collection through an account i.e. not over the counter, Section 142(2)(a) applies. (ii). Otherwise through an account - This mode would cover coll ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rise because as is apparent from the pleadings the collecting Bank i.e. Corporation Bank does maintain an account of the Complainant bearing Code No. GFC 563. 12.8. The submission of the accused that there is no distinction between the cross and bearer cheques and both are negotiable instruments and have to be presented to the drawee has no relevance to the interpretation. Both are undoubtedly negotiable instruments, however, both are treated separately by the Act in so far as how the payment is to be made is concerned, which Section 142 (2) seeks to bifurcate. 12.9. The case of the Complainant is fully covered by the Judgement of this Court in Criminal Miscellaneous Application No. 13062 of 2011 dated 30.03.2016 and in particular paragraphs 19, 28, 29, 41 and 42 where the Court has in terms discussed the mode of collection of cross cheques or open or bearer cheques. How the Cheque is delivered for collection and processed by the collecting bank through the coded account of the complainant is essentially a question of fact. That would depend on the evidence that may be led at the trial or an inquiry conducted pursuant to the orders of the Court. Such issue can therefore be a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate had been deposited and dishonored to the said Account No. 02090500000002 at Bank of Baroda, Vadodara. I say that the impugned cheques were deposited in New Delhi only to facilitate collection so that the amount is credited in the said Account No. 02090500000002 maintained by Respondent No. 2 at Bank of Baroda, Vadodara. 9. With reference to para 10 of the Application, I reproduce for ready reference the Explanation to S. 142(2) of the Negotiable InStruments Act, 1881 (hereinafter referred to as the Act ) after the amendment dated 26. 12.2015: Explanation: For the purpose 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 cheque 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. As aforesaid, Respondent No.2 maintains Account No. 02090500000002 at Bank of Baroda, Vadodara. The impugned cheques though deposited in New Delhi, as stated in the said Certificate dated 07.09.2015 issued by Corporation Bank, under the funds collected were to be credited in Account No. 02090500000002 at Bank of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has been a given a Customer Code GFC 563 for availing such service. Annexed hereto and marked as Anenxure-R3 (Colly.) are copies of Pay-in- Forms dated 17.10.2007 reflecting the said Customer Code GFC 563 and details of the cheques in question and copies of some cheques that got dishonoured with their Return Memos. For availing this service, the beneficiary need not have any bank account with Corporation Bank at any place in India including New Delhi. Instead, the Customer Code allotted is sufficient for effective functioning of the facility. 5. Thus, the total amount of the previous day s cheques so deposited gets reflected in the said Central Pooling Account even before the cheques so deposited get realized or dishonoured. In case of dishonour of a cheque deposited with any FCS Corporation Bank branch anywhere in the country, as per the terms and conditions of the arrangement, Corporation Bank currently charges ₹ 100/ - per such returned unpaid instrument and some interest as stated in the terms and conditions and give effect to the cheque dishonoured. Therefore, I say that, regardless of where a cheque is deposited by Respondent No.2 with any FCS branch of Corporat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ANALYSIS 15. Having heard the learned counsel appearing for the parties and having considered the materials on record, the only question that falls for my consideration is whether the 12th Additional Chief Judicial Magistrate, Vadodara has the territorial jurisdiction to try the complaints filed by the complainant under section 138 of the N.I. Act. 16. In the case of Brijendra Enterprise (supra), I had the occasion to consider the issue of territorial jurisdiction of a court to try the offence under section 138 of the N.I. Act having regard to the amended provisions of section 142 of the N.I. Act. In the said case, the cheque was drawn by the accused on an account maintained by him with the Union Bank of India, Badalapur, Dist: Jaunpur, State of U.P. The complainant deposited the cheque with the ICICI Bank Ltd., Gorakhpur Branch, Gorakhpur, State of U.P. The cheque was dishonoured as the funds were insufficient in the account maintained by the accused with the Union Bank of India. The complainant issued a statutory notice under section 138 of the Act and as the accused failed to make the payment within the statutory time period, the complaint was lodged in the court of the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly in a Court which has the territorial jurisdiction over the place where the cheque is dishonoured by the bank on which it is drawn. Thus, if a cheque is drawn by a person of the account maintained with his bank at Ahmedabad, the complaint for dishonour in respect of such cheque could be filed only in a Court at Ahmedabad within whose territorial jurisdiction the said bank is located. According to the decision of the Supreme Court, such a case cannot be filed in any other Court at any other place. For example, if 'X' is the payee of the cheque and if he presents a cheque for clearing at Vadodara, it cannot be filed at Vadodara. The judgment of the Supreme Court proceeded on the footing that the payee of a cheque should not necessarily harass the drawer of the cheque by filing complaint for dishonour at the place of his choice by deliberately choosing a different place for presenting the cheque or for sending the notice, etc. The above was the position according to the decision of the Supreme Court. It appears that the Legislature took notice of the difficulties experienced by the people at large and, therefore, thought fit to introduce the amendment by way of an Ordi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eques were delivered for collection or presented for payment within the territorial jurisdiction of that Court. (3) If, on the date of the commencement of the Negotiable Instruments (Amendment) Ordinance, 2015, more than one prosecution filed by the same payee or holder in due course, as the case may be, against the same drawer of cheques is pending before different Courts, upon the said fact having been brought to the notice of the Court, such Court shall transfer the case to the Court having jurisdiction under sub-section (2) of Section 142 before which the first case was filed and is pending, as if that sub-section had been in force at all material times. The Negotiable Instruments (Amendment) Ordinance, 2015 (Ordinance 6 of 2015) came to be replaced with the Negotiable Instruments (Amendment) Bill, 2015. The Negotiable Instruments (Amendment) Bill, 2015, inter alia, provides for the following, namely : (i) cases relating to dishonor of cheques under section 138 of the said Act to be inquired and tried only by a court within whose local jurisdiction the branch of the bank, where the payee or the holder in due course maintains the account, is situated; (ii) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Branch, Vadodara, of the 'PQR' Bank, deposits the said cheque at the Surat Branch of the 'PQR' Bank and the cheque is dishonoured. The complaint will have to be filed before the Court having the local jurisdiction where the M.S.University Road Branch, Vadodara, of the 'PQR' Bank is situated. 2. 'A' holds an account with the Navranpura Branch, Ahmedabad, of 'XYZ' Bank, issues a cheque payable at par in favour of 'B'. 'B' presents the said cheque at the Vadodara Branch of the 'XYZ' Bank (but 'B' does not hold account in any branch of the 'XYZ' Bank) and the cheque is dishonoured. The complaint will have to be filed before the Court having the local jurisdiction where the Navrangpura Branch, Ahmedabad, of the 'XYZ' Bank is situated. Therefore, to summarise, first, when the cheque is delivered for collection through an account, the complaint is to be filed before the Court where the branch of the bank is situated, where the payee or the holder in due course maintains his account and, secondly, when the cheque is presented for payment over the counter, the complaint is to be filed before the C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Since the cheque could not be cleared, the intimation regarding the same was given by the ICICI Bank Limited, JMC House, Ahmedabad Branch, to the complainant at its address of the registered office in Ahmedabad. Whatever may be the arrangement of the complainant with its banker, could it be said that the cheque was deposited in the ICICI Bank Limited at Ahmedabad i.e. the branch which actually gave intimation to the complainant regarding the dishonour of the cheque. The argument canvassed on behalf of the complainant is that since the requisite cheque amount was to be credited in the account maintained by the company with the ICICI Bank Limited at Ahmedabad and the intimation of dishonour was also by the branch of the ICICI Bank Limited at Ahmedabad, his complaint at Ahmedabad in the Court of the learned Metropolitan Magistrate is maintainable. Before adverting to the rival submissions canvassed on either side, let me look into the decision of the Supreme Court in the case of Bridgestone India Pvt. Ltd. v. Inderpal Singh, 2016(2) SCC 75. In the case before the Supreme Court, a cheque drawn on the Union Bank of India, Chandigarh, was issued by the respondent to the appellant. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an account being maintained by him in a bank for discharge of debt/liability is returned unpaid for insufficiency of funds or for the reason that the amount exceeds the arrangement made with the bank. 2.Cognizance of any such offence is however forbidden under Section 142 of the Act except upon a complaint in writing made by the payee or holder of the cheque in due course within a period of one month from the date the cause of action accrues to such payee or holder under clause (c) of proviso to Section 138. 58.3 The cause of action to file a complaint accrues to a complainant/payee/holder of a cheque in due course if (a) the dishonoured cheque is presented to the drawee bank within a period of six months from the date of its issue. (b) If the complainant has demanded payment of cheque amount within thirty days of receipt of information by him from the bank regarding the dishonour of the cheque, and (c) If the drawer has failed to pay the cheque amount within fifteen days of receipt of such notice. 58.4 The facts constituting cause of action do not constitute the ingredients of the offence under Section 138 of the Act. 58.5 The proviso to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uired 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 cheque 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. 4. In the principal Act, after section 142, the following section shall be inserted, namely:- 142A. (1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 or any judgment, decree, order or directions of any court, all cases transferred to the court having jurisdiction under sub-section (2) of section 142, as amended by the Negotiable Instruments (Amendment) Ordinance, 2015, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... struments Act is concerned, on the issue of jurisdiction, the provisions of the Code of Criminal Procedure, 1973, would have to give way to the provisions of the instant enactment on account of the non-obstante clause in sub-section (1) of Section 142A. Likewise, any judgment, decree, order or direction issued by a Court would have no effect insofar as the territorial jurisdiction for initiating proceedings under Section 138 of the Negotiable Instruments Act is concerned. In the above view of the matter, we are satisfied, that the judgment rendered by this Court in Dashrath Rupsingh Rathod's case would also not non-suit the appellant for the relief claimed. 12. We are in complete agreement with the contention advanced at the hands of the learned counsel for the appellant. We are satisfied, that Section 142(2)(a), amended through the Negotiable Instruments (Amendment) Second Ordinance, 2015, vests jurisdiction for initiating proceedings for the offence under Section 138 of the Negotiable Instruments Act, inter alia in the territorial jurisdiction of the Court, where the cheque is delivered for collection (through an account of the branch of the bank where the payee or hold ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... branch bank which accepts the cheques will thereafter process the same, and as explained above, the credit of the requisite amounts mentioned in the cheque would be given in the centralized pooling account, i.e. like in the present case, in the centralized pooling account maintained by the complainant at Ahmedabad. At this stage, it is important to look into the explanation in Section 142(2). The explanation provides that for the purposes of clause (a), where a cheque is delivered for collection at any branch of the bank of the payee or the holder in due course, then, the cheque shall be deemed to have been delivered to the branch of the bank in which the payee or the holder in due course, as the case may be, maintains the account. For example, like in the present case, the cheque was delivered for collection at the ICICI Bank, Gorakhpur branch, Uttar Pradesh, where the complainant has no account but, by virtue of the said explanation, it is deemed to have been delivered at the ICICI Bank, JMC House Branch, Ahmedabad, where the account is maintained. It is now well settled that an Explanation added to a statutory provision is not a substantive provision in any sense of the te ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the aid of the Article, because this reverses their roles. In Bihar Co-operative Development Cane Marketing Union Ltd. v. Bank of Bihar (1967) 1 SCR 848 : (AIR 1967 SC 389), the Supreme Court observed thus : The Explanation must be read so as to harmonise with and clear up any ambiguity in the main section. It should not be so construed as to widen the ambit of the section. In Hiralal Rattanlal etc. v. State of U.P. [(AIR 1973 SC 1034)], the Supreme Court observed thus : On the basis, of the language of the Explanation this Court held that it did not widen the scope of clause (c). But from what has been said in the case, it is clear that if on a true reading of an Explanation it appears that it has widened the scope of the main section, effect be given to legislative intent notwithstanding the fact that the legislature named that provision as an Explanation. In Dattatraya Govind Mahajan v. State of Maharashtra [(1977) 2 SCR 790: (AIR 1977 SC 915), the Supreme Court observed thus : It is true that the orthodox function of an explanation is to explain the meaning and effect of the main provision to which it is an explanation and to clear up any doub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... I find it difficult to accept the argument of the learned counsel appearing for the accused that the case in hand is covered by Section 142(2)(b). The argument is that as the cheque was delivered for collection at the ICICI Bank, Gorakhpur branch, Uttar Pradesh, without any account maintained in the said branch, it could be said that the cheque was presented for payment by the complainant otherwise through an account, and if that be so, the complaint for dishonour could be filed in a Court within whose local jurisdiction the branch of the drawee bank where the drawer maintains the account, is situated. In my view, the words otherwise through an account would mean that the cheque is presented for payment over the counter. In the case in hand, there is no question of presenting the cheque for payment over the counter because the cheque is crossed. When a cheque is crossed, the holder cannot encash it at the counter of the bank. The payment of such cheque is only credited to the bank account of the payee. A cheque is either 'open' or 'crossed'. An open cheque can be presented by the payee to the paying banker and is paid over the counter. A crossed cheque cannot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is present Court, what the object of the Legislature was, the Court is to see whether the terms of the section are such as fairly to carry out that object and no other, and to read the section with a view to finding out what it means, and not with a view to extending it to something that was not intended. 21. It is significant to note that the traditional English view earlier held that the Legislative intent is not to be gathered from the Parliamentary history and felt that the introduction of the measures in Parliament cannot be used as evidence for the purpose of showing the intention. The Law then gradually changed its course and it was held that the courts are entitled to consider such external or historical facts as may be necessary to understand the subject matter to which the statute relates. The House of Lords in Black-Clawsan International Ltd. v. Papierwerke Waldhof-Aschaffenburg, A.G., [(1975)1 All ER 810 (HL)]1 unanimously held that the report of a committee presented to the Parliament preceding the legislation could be seen for finding out the then state of the law and the mischief required to be remedied. The earlier traditional view came to be criticized and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ermitted or allowed to defeat the substantial justice. 24. The attendant circumstances and external aids being some of the tools available with the court for interpretation of a statute, their application has been largely accepted. In the case of Sub-Committee on Judicial Accountability v. Union of India and others, 1991 (4) SCC 699, the Constitution Bench of Supreme Court took the view that it was permissible to take into consideration the entire background as aid to interpretation and that it was a well settled principle of modern statutory construction that external aid could be used to discover the object of legislation particularly when internal aids are not forthcoming. Similar view was also accepted by the Supreme Court in the case of Shashikant Laxman Kale and another v. Union of India and another, (1990)4 SCC 366, where the court held as under:- For determining the purpose or object of the legislation, it is permissible to look into the circumstances which prevailed at the time when the law was passed and which necessitated the passing of that law. For the limited purpose of appreciating the background and the antecedent factual matrix leading to the legislation, it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t April, 1989. Section 138 of the said Act provides for penalties in case of dishonour of cheques due to insufficiency of funds in the account of the drawer of the cheque. 2. As Sections 138 to 142. of the said Act were found deficient in dealing with dishonour of cheques, the Negotiable Instruments (Amendment and Miscellaneous Provisions) Act, 2002, inter alia, amended Sections 138,141 and 142 and inserted new Sections 143 to 147 in the said Act aimed at speedy disposal of cases relating to dishonour of cheque through their summary trial as well as making, them compoundable. Punishment provided under Section 138 too was enhanced from one year to two years. These legislative reforms are aimed at encouraging the usage of cheque and enhancing the credibility of the instrument so that the normal business transactions and settlement of liabilities could be ensured. 3. The Supreme Court, in its judgment dated 1st August, 2014, in the case of Dashrath Rupsingh Rathod v. State of Maharashtra, (2014) 9 SCC 129, held that the territorial jurisdiction for dishonour of cheques is restricted to the court within whose local jurisdiction the offence was committed, which in the presen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall be filed before the same court. Irrespetive of whether those cheques were presented for payment within the territorial jurisdiction of that court; (iii) stipulating that if more than one prosecution is filed against the same drawer of cheques before different courts, upon the said fact having been brought to the notice of the court, the court shall transfer the case to the court having jurisdiction as per the new scheme of jurisdiction; and (iv) amending Explanation 1 under Section 6 of the said Act relating to the meaning of expression a cheque in the electronic form , as the said meaning is found to be deficient because it presumes drawing of a physical cheque, which is not the objecrive in preparing a cheque in the electronic form and inserting a new Explanation III in the said section giving :reference of the expressions contained in the Information Technology Act, 2000. 6. It is expected that the proposed amendments to the Negotiable Instruments Act, 1881 would help in ensuring that a fair trial of cases under Section 138 of the said Act is conducted keeping in view the interests of the complainant by clarifying the territorial jurisdiction for tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 138 of the N.I. Act. The Supreme Court, ultimately, held that the complainant could choose any one of those courts, having jurisdiction over any one of the local areas within the territorial limits, of which, any one of those five acts was done. 31. The judgment of the Supreme Court, in the case of K. Bheskaran (supra) was followed over a period of time. However, in view of the other decisions of the Supreme Court, in the case of Nishant Aggarwal vs. Kailash Kumar Sharma, reported in 2013(10) SCC 72, in the case of Shri Ishar Alloys Steels Ltd. vs. Jayaswals Neco Ltd., reported in 2001 (3) SCC 609 and in the case of Harman Electronicss (P) Ltd. vs. National Panasonic India Ltd., reported in 2009 (1) SCC 720, the issue as regards the territorial jurisdiction, once again, became debatable. In such circumstances, a larger bench was constituted, and it delivered the judgment in the case of Dasrath Rupsingh Rathod (supra). In this case, a three judge bench of the Supreme Court had held that a cheque bouncing case can be filed only in a court, which has the territorial jurisdiction over the place where the cheque is dishonoured by the Bank on which it is drawn. This judgment, in the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ced). It would not be out of place to state at this stage that in the N.I. Amendment Bill, 2015, as introduced in the Lok Sabha section 142 (2) intended to be amended as follows; Section 142, Cognizance of offences:- (2) The offence under section 138 shall be inquired into and tried only by a court within whose local jurisdiction the bank branch of the payee, where the payee presents the cheque for payment, is situated. 35. Accordingly, the N.I. Amendment Bill, 2015, which, in fact was approved by the Lok Sabha, but couldn t make it through the Rajya Sabha, provided that the Court will try the case within whose local jurisdiction the bank branch of the payee, where the payee presents the cheque for payment, is situated. However, the N.I. Ordinance, 2015, did not stick to what the N.I. Amendment Bill, 2015 suggested and provided additional set of rules for the cases not presented through the payee s bank account. What I am trying to drive at is that it was not possible for the legislature to keep in mind all the possible permutations and combinations of the problems arising in filing the cases under section 138 of the N.I. Act. The N.I. Ordinance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Other SBI Locations Day 0-Day21 Rs.0.10 5) Pooling Branch Bank of Baroda, Fertilizernagar, Main Branch, Vadodara. 6) Mode of Pooling By way of credit to client s BOB banks CC a/c. No. 02090500000002 maintained with Bank of Baroda, Ferlitizernagar, Vadodara. 7) Return Instrument Charges ₹ 100/- per instrument + interest @ 14.50% p.a. i.e. Base Rate (10.25% p.a.) + 4.25% for the period bank is rendered out of funds. 8) Interest on RIA 14.50% p.a. i.e. Base Rate (10.25% p.a.) + 4.25%, till the date of recovery. 9) Courier charges per Instrument Location. No. 10) Courier Arrangement No. 11) Interest on delayed realization No. 39. Thus, although the cheques issued by the accused were collected by the complainant at New Delhi and were presented for clearance with the Corporation Bank at New Delhi, yet in my view, it could be said that the cheques were presented through an account, i.e., the account maintained by the complainant with the Bank of Baroda, Fertilizer Nagar Branch, Vadodara. Without the account of the complainant maintained with the Bank of Baroda, Fertilizer Na ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to the bank account of the complainant. 41. The effect of the rule of strict construction might almost be summed up in the remark that where an equivocal word or ambiguous sentence leaves a reasonable doubt of its meaning which the canons of interpretation fail to solve, the benefit of the doubt should be given to the subject and against the legislature which has failed to explain itself. But it yields to the paramount rule that every statute is to be expounded according to its expressed or manifest intention and that all cases within the mischiefs aimed at are, if the language permit, to be held to fall within its remedial influence. 42. I do agree, to a certain extent, with Mr. Parikh, the learned senior counsel appearing for the applicants that in the complaint lodged by the complainant, there is not even a passing reference to the account maintained by the complainant with the Bank of Baroda, Fertilizer Nagar Branch, Vadodara. The territorial jurisdiction of a particular court to try the case can be determined on the basis of the averments made in the complaint in that regard. However, there is overwhelming materials on record as regards the Bank of Baroda account, whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome other Magistrate having jurisdiction. No summons or warrant shall be issued against the accused under sub-section (1) until a list of the prosecution witnesses has been filed. In a proceeding instituted upon a complaint made in writing, every summons or warrant issued under sub-section (1) shall be accompanied by a copy of such complaint. 48. The aforesaid provisions make it clear that the Magistrate is required to issue summons for attendance of the accused only on examination of the complaint and on satisfaction that there is sufficient ground for taking cognizance of the offence and that he is competent to take such cognizance of offence. Once the decision is taken and summons is issued, in the absence of a power of review including the inherent power to do so, the remedy lies before the High Court under Section 482 Cr. P.C or under Article 227 of the Constitution of India and not before the Magistrate. 49. Section 201 Cr.P.C., as noticed earlier, can be applied immediately on receipt of a complaint, if the Magistrate is not competent to take cognizance of the offence. Once the Magistrate taking cognizance of an offence forms his opinion that there is sufficient ground ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
