Hdfc Bank Ltd. vs Salamuddin Ahmed
2009 Latest Caselaw 2058 Del

              HIGH COURT OF DELHI : NEW DELHI

             Judgment reserved on: May 14, 2009
            Judgment delivered on: May 15, 2009

+              (1)     Crl. Rev. P. No. 151/2009
+              (2)     Crl. Rev. P. No. 152/2009
+              (3)     Crl. Rev. P. No. 153/2009
+              (4)     Crl. Rev. P. No. 154/2009
+              (5)     Crl. Rev. P. No. 156/2009
+              (6)     Crl. Rev. P. No. 157/2009
+              (7)     Crl. Rev. P. No. 158/2009
+              (8)     Crl. Rev. P. No. 159/2009

%      HDFC Bank Ltd.              ...      Petitioner
                     Through: Mr. Punit Kumar Bhalla,
                              Advocate

                                        versus
   Salamuddin Ahmed
   Ghanshyam
   Rajender Singh
   Deepankar Arora
   Khurshid
   Sanjeev Kumar
   Sanjay Sukhija
   Kanchhe Singh              ...                  Respondents
                  Through: Nemo.
CORAM:

HON'BLE MR. JUSTICE SUNIL GAUR

1. Whether the Reporters of local papers may
   be allowed to see the judgment?

2. To be referred to Reporter or not?

3. Whether the judgment should be reported
   in the Digest?

SUNIL GAUR, J.

*

1. The question involved in the above titled eight

petitions is of territorial jurisdiction. Petitioner had filed

Crl. Rev. P. No. 151-154/2009 & 156-159/2009 Page 1 eight complaints under section 138 of Negotiable

Instruments Act, 1881 before a Metropolitan Magistrate,

Dwarka Courts, Delhi, against the Respondents regarding

bouncing of cheques.

2. Vide impugned order of 25th February, 2009, trial

court has dismissed Petitioner's aforesaid complaints on

the ground of territorial jurisdiction by relying upon a

recent verdict of the Apex Court in the case of "Harman

Electronics (P) Ltd. and Anr. Vs. National Panasonic India

Ltd.", reported in (2009) 1 SCC 720.

3. Petitioner's counsel has been heard at length and the

decision reported in (1999) 7 SCC 510 relied upon by

him have been perused.

4. In these petitions, it is not in dispute that the

Respondents are residing outside the territorial jurisdiction

of the trial court and the bank of the Respondents is also

beyond the territorial jurisdiction of the trial court. It would

be pertinent to quote paragraphs No. 24 and 25 from a

recent verdict of the Apex Court in the case of "Harman

Electronics (P) Ltd. and Anr. Vs. National Panasonic India

Ltd.", reported in (2009) 1 SCC 720, which reads as

under:-

Crl. Rev. P. No. 151-154/2009 & 156-159/2009 Page 2 "24. Indisputably all statutes deserve their strict application, but while doing so the cardinal principles therefor cannot be lost sight of. A Court derives a jurisdiction only when the cause of action arose within his jurisdiction. The same cannot be conferred by any act of omission or commission on the part of the accused. A distinction must also be borne in mind between the ingredient of an offence and commission of a part of the offence. While issuance of a notice by the holder of a negotiable instrument is necessary, service thereof is also imperative. Only on a service of such notice and failure on the part of the accused to pay the demanded amount within a period of 15 days thereafter, commission of an offence completes. Giving of notice, therefore, cannot have any precedent over the service. It is only from that view of the matter in Dalmia Cement (Bharat) Ltd. v. Galaxy Traders & Agencies Ltd., (2001) 6 SCC 463, emphasis has been laid on service of notice.

25. We cannot, as things stand today, be oblivious of the fact that a banking institution holding several cheques signed by the same borrower cannot only present the cheque for its encashment at four different places but also may serve notices from four different places so as to enable it to file four complaint cases at four different places. This only causes grave harassment to the accused. It is, therefore,

Crl. Rev. P. No. 151-154/2009 & 156-159/2009 Page 3 necessary in a case of this nature to strike a balance between the right of the complainant and the right of an accused vis-a-vis the provisions of the Code of Criminal Procedure."

5. However, learned counsel for the Petitioner heavily

relies upon another decision of the Coordinate Bench of

the Apex Court in the case of "K. Bhaskaran v. Sankaran

Vaidhyan Balan and Anr., (1999) 7 SCC 510, to contend

that place of drawing of cheque, its presentation, its

return, place of giving of notice and place of failure of

drawer to make the payment would have the jurisdiction

to entertain a complaint under section 138 of Negotiable

Instruments Act, 1881, pertaining to bouncing of cheque

and the complaint can be filed at any one of the five

places and the choice will be of the Complainant.

6. It has been pointed out on behalf of the Petitioner

that aforesaid case of K. Bhaskaran (supra) has been

quoted with approval in a recent unreported decision by

the Apex Court in the case of "Smt. Shamshad Begum vs.

B. Mohammad", Crl. A. No.1715/2008, decided on 3rd

November, 2008 and the same has been relied upon by a

single bench of the High Court of Madhya Pradesh in Crl.

C. No.1233/2009, titled "Manjul vs. Wasim Shekh" decided

Crl. Rev. P. No. 151-154/2009 & 156-159/2009 Page 4 on 3rd March, 2009, while distinguishing the verdict of the

Apex Court in the case of Harman Electronics (Supra).

7. Learned counsel for the Petitioner vehemently

contends that the case of Harman Electronics (Supra) has

been illegally relied upon by the trial court but the same is

distinguishable on facts as in the above said case,

statutory notice was given from Delhi but the entire

transaction had taken place at Chandigarh and therefore,

it had been held that the Delhi courts do not have

territorial jurisdiction as by giving of notice alone,

territorial jurisdiction cannot be created.

8. After having heard learned counsel for the Petitioner

at length and upon perusal of the decisions cited, I am of

the considered opinion that the recent verdict of the Apex

Court in the case of M/s. Harman Electronics (Supra) holds

the field. This decision has been rendered by the Apex

Court on 12th December, 2008 and the earlier decision of

the Apex Court rendered in the case of K. Bhaskaran

(Supra) has been duly considered and the conclusive

observations made in paragraph No. 14, reads as under:-

"14. It is one thing to say that sending of a notice is one of the ingredients for maintaining the complaint but it is another thing to say that Crl. Rev. P. No. 151-154/2009 & 156-159/2009 Page 5 dishonour of a cheque by itself constitutes an offence. For the purpose of proving its case that the accused had committed an offence under Section 138 of the Negotiable Instruments Act, the ingredients thereof are required to be proved. What would constitute an offence is stated in the main provision. The proviso appended thereto, however, imposes certain further conditions which are required to be fulfilled before cognizance of the offence can be taken. If the ingredients for constitution of the offence laid down in the provisos (a), (b) and (c) appended to Section 138 of the Negotiable Instruments Act intended to be applied in favour of the accused, there cannot be any doubt that receipt of a notice would ultimately give rise to the cause of action for filing a complaint. As it is only on receipt of the notice the accused at his own peril may refuse to pay the amount. Clauses (b) and (c) of the proviso to Section 138 therefore must be read together. Issuance of notice would not by itself give rise to a cause of action but communication of the notice would." (emphasis supplied)

9. Thus, it is abundantly clear that for commission of an

offence under section 138 of Negotiable Instruments Act,

1881, notice must be received by the accused. It may be

deemed to have been received in certain situations.

Crl. Rev. P. No. 151-154/2009 & 156-159/2009 Page 6 Section 177 of the Code of Criminal Procedure determines

the jurisdiction of a court trying the matter. The court will

have the jurisdiction only where the offence has been

committed. The provisions of Sections 178 and 179 of the

Code of Criminal Procedure are exceptions to Section 177.

These provisions presuppose that all offences are local.

However, there may be a case, where the accused would

have shifted his residence outside the territorial

jurisdiction of the court concerned, but then, in such a

case, the court in whose territorial jurisdiction drawee

bank, (i.e., banker of the accused) is situated would have

the territorial jurisdiction to entertain the complaint in

question. Therefore, the place where an offence has been

committed plays an important role. Therefore, the place

where an offence has been committed plays an important

role.

10. In M/s. Harman Electronics (Supra), the contention

was raised that a debtor must seek the creditor should be

applied in a case of this nature and it was repelled in the

following words:-

"We regret that such a principle cannot be applied in a criminal case. Jurisdiction of the Court to try a criminal case is governed by the

Crl. Rev. P. No. 151-154/2009 & 156-159/2009 Page 7 provisions of the Criminal Procedure Code and not on common law principle."

11. It needs no elaboration that when two decisions of

coordinate benches of the Apex Court are cited, then the

later one prevails. The decision of the Apex Court in the

case of Smt. Shamshad Begum (supra) relied upon by the

Petitioner is of 3rd November, 2008; whereas, the Apex

Court decision in the case of M/s. Harman Electronics

(Supra) is of 12th December, 2008. I find myself unable to

agree with the reasoning in decision rendered by a Single

Bench of the High Court of Madhya Pradesh in the case of

Manjul vs. Wasim Shekh (Supra), as the latest decision of

the Apex Court in the case of M/s. Harman Electronics

(Supra) cannot be brushed aside by simply observing that

it was rendered in a different context and by relying upon

the decision in the case of K. Bhaskaran (Supra).

12. It is a ground reality that weWe cannot, as things

stand today, be oblivious that financial institutions have

their branch offices in number of cities from where they

enter into transactions with the persons interested in

personal loan/housing loan/car loan/furniture

loan/educational loan, etc. and the courts cannot be a

Crl. Rev. P. No. 151-154/2009 & 156-159/2009 Page 8 mute spectator by permitting the Complainant to proceed

against accused persons residing at far of places.

13. The aforesaid ground reality stands illustrated from

Crl. Rev. P. No. 210/2009, wherein the Respondent-

accused is from Vellore, which is in South India and the

complaint regarding dishonor of cheque has been filed in

Delhi court. Taking note of such a situation, Apex Court in

the case of M/s. Harman Electronics (Supra) has declared

in unequivocal terms that financial institutions, ought not

to be permitted to do forum hunting as per their

convenience, much to the grave harassment of the

accused and a balance has to be struck.

14. I am in respectful agreement with the above said

ratio of the decision in the case of M/s. Harman Electronics

(Supra).

15. During the course of the arguments, it had transpired

that criminal complaints of Petitioner pertain to cheque

amounts ranging from Rs.1,500/- to Rs.4,500/- only in

these matters. In such like cases, it would be too harsh

upon a Respondent/accused to come to Delhi from far of

places and to face the proceedings under section 138 of

Negotiable Instruments Act, 1881, merely because

Crl. Rev. P. No. 151-154/2009 & 156-159/2009 Page 9 Petitioner chooses to file the complaints under the

aforesaid Act in Delhi.

16. It is a hard reality that the financial institutions like

the Petitioner, have made Delhi Courts a dumping ground

for filing of criminal complaints under section 138 of

Negotiable Instruments Act, 1881, in bulk and, even in

cases where the territorial jurisdiction is of the courts as

far as in South India. This has resulted in choking of the

criminal courts seized with such like matters. In the

impugned order, trial court has rightly relied upon the

latest verdict of the Apex Court rendered in the case of

M/s. Harman Electronics (Supra) to hold that it does not

have territorial jurisdiction to entertain these criminal

complaints.

17. Although in Crl. Rev. P. No. 157/2009, the address of

Respondent is shown to be of Delhi but the same is

against record, as the trial court record clearly shows that

the address of the Respondent in the complaint as well as

in statutory notice is of Bahadurgarh, which is in State of

Haryana, i.e. outside Delhi and outside the purview of

jurisdiction of the trial court, therefore, the position in Crl.

Rev. P. No. 157/2009 is no different and is on the similar

footing as in the connected petitions.

Crl. Rev. P. No. 151-154/2009 & 156-159/2009 Page 10

18. In view of the aforesaid narration, I do not find any

illegality or infirmity in the impugned order of 25th

February, 2009 and thus, all these revision petitions are

dismissed being meritless.

19. With aforesaid observations, these eight petitions

stand disposed of.

Sunil Gaur, J.

May 15, 2009 pkb

Crl. Rev. P. No. 151-154/2009 & 156-159/2009 Page 11