Ms. Hema Chaturvedi vs M/S Sunint Enterprises Pvt. Ltd.
2010 Latest Caselaw 4993 Del

          IN THE HIGH COURT OF DELHI: NEW DELHI

+             CRL. M.C. 213/2010

%             Judgment decided on: 29th October, 2010

MS. HEMA CHATURVEDI                            ..... Petitioner
                 Through:            Mr. N.B. Joshi and Mr. Ajit
                                     Kumar, Advs.
                          Versus

M/S SUNINT ENTERPRISES PVT. LTD.                .....Respondent

                          Through:   Mr. Surendra Kumar and
                                     Mr. A.K. Babbar, Advs.

Coram:
HON'BLE MR. JUSTICE A.K. PATHAK

       1. Whether the Reporters of local papers
          may be allowed to see the judgment?         No

       2. To be referred to Reporter or not?          No

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


A.K. PATHAK, J. (Oral)

1. Short question which needs to be answered in this

petition is "whether the courts at Delhi will have territorial

jurisdiction to entertain and try the complaint under Section

138 of Negotiable Instruments Act, 1881 (for short

hereinafter referred to as "the N.I. Act") for the reasons that

complainant has its registered office; cheque was deposited

and notice was issued from Delhi".

2. Factual matrix of the case is that the respondent has

filed a complaint under Section 138/142 of the N.I. Act read

with Section 420B of the Indian Penal Code against the

petitioner alleging therein that it was having its Registered

office at Delhi and works at Hapur; it supplied lubricant oil

worth ` 11,52,350/- to the petitioner on credit basis;

petitioner in order to clear the part liability issued a cheque

no. 511402 dated 20th June, 2007 for ` 4,97,750/- drawn on

ICICI Bank Limited, Chowk Allahabad Branch, Allahabad in

favour of the respondent, which was deposited by the

respondent in its bank i.e. Syndicate Bank, Mori Gate, New

Delhi on 26th June, 2007 for collection. However, the

cheque was returned dishonoured along with a Return

Memo dated 5th July, 2007 for the reason "payment stopped

by the drawer". Since the amount was not paid despite

demand notice served on the petitioner within the statutory

period, hence the complaint.

3. With regard to the territorial jurisdiction respondent

has averred in the complaint as under :-

"That the complainant company‟s registered Office is at Delhi and the banker of the Complainant company is also in Delhi and hence this court has the territorial jurisdiction to try and decide this criminal complaint."

4. It appears that the complaint had been filed in Delhi

since respondent is having its Registered Office at Delhi; its

bank, where cheque was deposited, is in Delhi as also

because the notice had been issued by the respondent from

its Registered Office at Delhi. In my view, merely because

the respondent has Registered Office at Delhi, its bank is in

Delhi and the notice had been issued from Delhi, would not

vest territorial jurisdiction on Delhi courts to entertain and

try the complaint under Section 138 of the N.I. Act.

5. Section 138 of the N.I. Act Reads as under:-

138. Dishonour of cheque for insufficiency, etc., of funds in the accounts

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 with that bank, such person shall be deemed to have committed an offence and shall without prejudice to any other provisions of this Act, be punished with imprisonment for ["a term which may extend to two year"], 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 induce 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, 3["within thirty days"] of the receipt of information by him from the bank regarding the return of the cheques 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 purpose of this section, "debt or other liability" means a legally enforceable debt or other liability".

6. Bare perusal of the aforesaid provision shows that the

cheque has to be presented on the drawer‟s bank, where

account is being maintained by him. It is only the banker of

the drawer which will be in a position to say that the cheque

amount exceeds arrangement. Only drawer‟s bank can

return the cheque unpaid for "insufficient funds in the

account of drawer" or for any other reason. The payee of

the cheque has no option but to present the cheque for

encashment to the drawer‟s bank, on which the cheque had

been drawn, either personally or through a bank. The payee

of the cheque has the option to present the cheque in any

bank but to attract the criminal liability of the drawer of the

cheque such collecting bank is obliged to present the cheque

to drawer‟s bank on which the cheque is drawn that too

within a period of six months. In view of this, merely

because the payee had deposited the cheque at Delhi would

not mean that he had presented the cheque at Delhi.

7. In Ishar Alloy Steel Ltd. vs. Jayaswals NECO Ltd.

2001 Criminal Law Journal 1250, Supreme Court held as

under :-

"Thus, „the bank‟ referred to in Clause (a) to the proviso to Section 138 of the Act means the drawee bank on which the cheque is drawn and not all banks where the cheque is presented for collection including the bank of the payee in whose favor the cheque is issued."

8. In V.S. Thakur vs. State and Anr.

Manu/DE/3317/2009 this Court held as under:-

"The ratio of the above referred judgment of the Hon‟ble Supreme Court is that a cheque is deemed to have been presented to the banker of the drawer irrespective of the fact whether it is deposited by the

payee in his own bank. The banker of the payee, after receiving the cheque from him, is required to present it to the banker of the drawer and therefore, if the cheque issued from a bank in Dehrudun is deposited in Delhi, the bank in which it is deposited in Delhi, cannot be said that the cheque issued by the petitioner was presented in Delhi, despite the fact that the bank in which the respondent No.2 had an account was in Delhi, the cheque shall be deemed to have been presented only to the bank at Dehradun on which it was drawn. Therefore, deposit of cheque in Delhi would not confer jurisdiction of Delhi court to try this complaint."

(Emphasis supplied)

9. In the above legal backdrop, it can be concluded that

the Court within whose territorial jurisdiction drawee bank

is situated would have territorial jurisdiction to entertain a

complaint under Section 138 of the N.I. Act. Similar view has

been expressed by this Court ICICI Bank Ltd. Vs.Subhash

Chand Bansal & Ors. 160 (2009) Delhi Law Times 379.

10. Mere issuance of notice from Delhi will also not attract

the jurisdiction of Delhi courts. In Harman Electronics (P)

Ltd. and Anr. v. National Panasonic India Ltd. AIR 2009

SC 1168, it has been held that the place of service would

matter and not the place where the notice had been issued.

Accordingly, merely because notice had been issued from

Delhi would also not vest jurisdiction on Delhi courts for

preferring a complaint under Section 138 of the Act.

10. In K. Bhaskaran v. Sankaran Vaidhyan Balan and

Anr. MANU/SC/0625/1999 : (1999) 7 SCC 510, it had been

held that the offence under Section 138 of the Act can be

completed only with the concatenation of number of acts,

that is (i) drawing of the cheque (ii) presentation of the

cheque to the bank (iii) returning the cheque unpaid by the

drawee bank (iv) giving notice in writing to the drawer of the

cheque demanding payment of the cheque amount (v) failure

of the drawer to make payment within 15 days of the receipt

of the notice. In case 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. In

other words, the complainant can chose any 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.

11. Merely, because respondent has its Registered Office at

Delhi by itself would not vest jurisdiction in courts, at Delhi.

Reliance placed on K. Bhaskaran (supra) by the counsel for

the respondent does not advance his case any further as the

Registered Office of the complainant has not been identified

as the place where the complaint can be filed. Place of

notice has also been clarified in Harman Electronics‟ case

(supra).

12. For the foregoing reasons, I am of the view that Delhi

courts have no territorial jurisdiction to entertain and try the

complaint under Section 138 of the N.I. Act filed by the

respondent. Accordingly, this petition is disposed of with

the direction to the Trial Court to return the complaint to the

respondent forthwith, who shall prefer the same in the court

of competent jurisdiction within period of one month from

the date complaint is handed over to it.

A.K. PATHAK, J.

OCTOBER 29, 2010 ga