Karnataka High Court
Visveshwar Bhat S/O Ramachandra ... vs Vishwamitra Vishweshwar Hegde on 1 August, 2023
Bench: M.Nagaprasannapresided Bymnpj
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CRL.P No. 104156 of 2022
IN THE HIGH COURT OF KARNATAKA,
DHARWAD BENCH
DATED THIS THE 1ST DAY OF AUGUST, 2023
BEFORE
THE HON'BLE MR JUSTICE M.NAGAPRASANNA
CRIMINAL PETITION NO. 104156 OF 2022 (482)
BETWEEN:
VISVESHWAR BHAT S/O RAMACHANDRA BHAT,
AGE 56 YEARS, OCC: BUSINESS,
R/O: "VISHWA VANI" #915,
DHANUSH PLAZA, III FLOOR,
IDEAL HOME TOWN SHIP, RAJESHWARI NAGAR,
BENGALURU-560098.
... PETITIONER
(BY SRI. SOURABH HEGDE & SOUMYA HEDGE, ADVOCATES)
AND:
VISHWAMITRA VISHWESHWAR HEGDE,
AGE 60 YEARS, OCC: PRIVATE SERVICE,
Digitally
signed by R/O: "BANASHANKARI", VIJAYANAGAR MAIN ROAD,
VISHAL GANDHI NAGAR, PO. NILEKANI
VISHAL NINGAPPA
NINGAPPA PATTIHAL
SIRSI , UTTAR KANNADA-581401.
PATTIHAL Date: ... RESPONDENT
2023.08.02 (BY SRI. ANOOP G.DESHPANDE, ADVOCATE)
10:25:22
+0530
THIS CRIMINAL PETITION IS FILED UNDER SECTION 482
OF CR.P.C., SEEKING TO QUASHING THE CRIMINAL
PROCEEDINGS IN CC NO. 631/2018 PENDING ON THE FILE OF
III ADDL. JMFC, SIRSI, AT SIRSI FOR OFFENCE PUNISHABLE
UNDER SECTION 138 OF N.I. ACT.
THIS PETITION, COMING ON FOR ADMISSION, THIS DAY,
THE COURT MADE THE FOLLOWING:
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CRL.P No. 104156 of 2022
ORDER
1. The petitioner is before this Court calling in
question the proceedings in C.C. No.631/2018 pendingo n
the file of III-Addl. JMFC, Sirsi at Sirsi for the offence
punishable under Section 138 of N.I. Act.
2. Heard the learned counsel appearing for the
petitioner Shri Sourabh Hegde and the learned counsel for
the respondent Shri Anoop G.Deshpande.
3. Facts in brief germane are as follows:
The petitioner and the respondent have a
transaction. Pursuant to the said transaction, the accused
is said to have issued certain cheques to the complainant,
which are dishonored. Presentation and dishonoring of the
cheques happen at Hubballi. The complainant after the
said dishonoring of the cheques at Hubballi registered the
complaint invoking Section 200 of the Cr.P.C. before the
Court at Sirsi. The Concerned Court takes cognizance of
the offences and registers C.C. No.631/2018 for the
offences punishable under Section 138 of the N.I. Act.
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4. The petitioner is before this Court calling in
question the registration of the proceedings in C.C.
No.631/2018 for the offence punishable under Section 138
of the N.I. Act on the score that the concerned Court at
Sirsi had no jurisdiction to entertain the complaint as all
the events i.e., issuance, dishonor and communication is
Bank at Hubbali and the Court at Sirsi did not admittedly
have jurisdiction. Learned counsel seek to place reliance
on the judgment rendered by the Hon'ble Apex Court in
the case of Yogesh Upadhyay and Anr. Vs. Atlanta
Limited reported in (2023)2 SCR 511.
5. Learned counsel appearing for the respondent
would though refute the submission is not in a position to
dispute the position of law as is laid down by the Hon'ble
Apex Court in the aforesaid judgment. He would only seek
liberty to initiate appropriate proceedings before the
appropriate Forum.
6. I have given my anxious consideration to the
arguments advanced on both sides.
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7. The aforementioned facts lie in a narrow
compass, the issue with regard to entertainment of the
complaint and taking of cognizance by a Court at Sirsi
notwithstanding the fact that the transaction having
happened at Hubbali is not in dispute. The issue is
therefore stands covered on all its fours to the judgment
of the Hon'ble Apex Court in the case of Yogesh
Upadhyay and Anr (Supra), wherein at paragraph Nos.5
to 14 has held as under:
"5. It is now well settled that the offence
under Section 138 of the Act of 1881 is complete
upon dishonour of the cheque but prosecution in
relation to such offence is postponed, by virtue of
the provisos therein, till the failure of the drawer
of the cheque to make the payment within 15 days
of receiving the demand notice. However,
jurisdiction to try this offence remained a
troublesome issue for a long time.
6. In K. Bhaskaran Vs. Sankaran
Vaidhyan Balan and another [(1999) 7 SCC
510], this Court held that an offence under
Section 138 of the Act of 1881 has five
components: (1) drawing of the cheque, (2)
presentation of the cheque to the bank, (3)
returning of the cheque unpaid by the drawee
bank, (4) giving notice in writing to the drawer of
the cheque demanding payment of the cheque
amount, and (5) failure of the drawer to make
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CRL.P No. 104156 of 2022
payment within 15 days of the receipt of the
notice. It was further held that the Courts having
jurisdiction over the territorial limits wherein any
of the five acts, that constitute the components of
the offence, occurred would have the jurisdiction
to deal with the case and if the five acts were done
in five different areas, any one of the Courts
exercising jurisdiction in those five areas would
have jurisdiction and the complainant could choose
any one of those Courts.
7. Thereafter, in Dashrath Rupsingh
Rathod Vs. State of Maharashtra and another
[(2014) 9 SCC 129], a 3-Judges Bench of this
Court observed that the return of the cheque by
the drawee bank would alone constitute
commission of the offence under Section 138 of
the Act of 1881 and would indicate the place
where the offence is committed. It was, therefore,
held that the place, situs or venue of judicial
inquiry and trial of the offence must logically be
restricted to where the drawee bank is located,
i.e., where the cheque is dishonoured upon
presentation and not where the complainant's
bank is situated.
8. In this regard, it may be noted that
Section 142 of the Act of 1881, titled 'Cognizance
of Offences', provided that, notwithstanding
anything contained in the Code of Criminal
Procedure, 1973, no Court shall take cognizance of
an offence punishable under Section 138 except
on a complaint in writing made by the payee or, as
the case may be, the holder in due course of the
cheque; such complaint is made within one month
of the date on which the cause of action arises
under clause (c) of the proviso to Section 138; and
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no Court inferior to that of a Metropolitan
Magistrate or a Judicial Magistrate of the First
Class shall try an offence punishable under Section
138.
9. Significantly, the aforestated original
Section 142 of the Act of 1881 was renumbered as
Section 142(1) when amendments were made in
the Act of 1881 by the Negotiable Instruments
(Amendment) Act, 2015 (Act 26 of 2015). Further,
Section 142(2) was inserted in the statute book
along with Section 142-A. The newly inserted
Section 142(2), to the extent relevant, states that
the offence under Section 138 shall be inquired
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.
10. This being the statutory scheme, stress
is laid by Mr. Chirag M. Shroff, learned counsel,
upon the 6 words: 'shall be inquired into and tried
only by a Court within whose local
jurisdiction......'in Section 142(2) to contend that
the Courts at Nagpur would have exclusive
jurisdiction in relation to the dishonoured cheques
presented by the respondent company through its
bank at Nagpur.
11. Perusal of the Statement of Objects and
Reasons in Amendment Act 26 of 2015 makes it
amply clear that insertion of Sections 142(2) and
142-A in the Act of 1881 was a direct consequence
of the judgment of this Court in Dashrath
Rupsingh Rathod (supra). Therefore, the use of
the phrase: 'shall be inquired into and tried only
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by a Court within whose local jurisdiction......'in
Section 142(2) of the Act 1881 is contextual to the
ratio laid down in Dashrath Rupsingh Rathod
(supra) to the contrary, whereby territorial
jurisdiction to try an offence under Section 138 of
the Act of 1881 vested in the Court having
jurisdiction over the drawee bank and not the
complainant's bank where he had presented the
cheque. Section 142(2) now makes it clear that
the jurisdiction to try such an offence would vest
only in 7 the Court within whose jurisdiction the
branch of the Bank where the cheque was
delivered for collection, through the account of the
payee or holder in due course, is situated. The
newly inserted Section 142-A further clarifies this
position by validating the transfer of pending cases
to the Courts conferred with such jurisdiction after
the amendment.
12. The later decision of this Court in
Bridgestone India Private Limited Vs.
Inderpal Singh [(2016) 2 SCC 75] affirmed the
legal position obtaining after the amendment of
the Act of 1881 and endorsed that Section
142(2)(a) of the Act of 1881 vests jurisdiction for
initiating proceedings for an offence under Section
138 in the Court where the cheque is delivered for
collection, i.e., through an account in the branch
of the bank where the payee or holder in due
course maintains an account. This Court also
affirmed that Dashrath Rupsingh Rathod
(supra) would not non-suit the company in so far
as territorial jurisdiction for initiating proceedings
under Section 138 of the Act of 1881 was
concerned.
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13. Therefore, institution of the first two
complaint cases before the Courts at Nagpur is in
keeping with the legal position obtaining now.
However, the contention that the non obstante
clause in Section 142(1) of the Act of 1881 would
override Section 406 Cr.P.C. and that it would not
be permissible for this Court to transfer the said
complaint cases, in exercise of power thereunder,
cannot be countenanced. It may be noted that the
non obstante clause was there in the original
Section 142 itself and was not introduced by way
of the amendments in the year 2015, along with
Section 142(2). The said clause merely has
reference to the manner in which cognizance is to
be taken in offences under Section 138 of the Act
of 1881, as a departure has to be made from the
usual procedure inasmuch as prosecution for the
said offence stands postponed despite commission
of the offence being complete upon dishonour of
the cheque and it must necessarily be in terms of
the procedure prescribed. The clause, therefore,
has to be read and understood in the context and
for the purpose it is used and it does not lend itself
to the interpretation that Section 406 Cr.P.C.
would stand excluded vis-à-vis offences under
Section 138 of the Act of 1881. The power of this
Court to transfer pending criminal proceedings
under Section 406 Cr.P.C. does not stand
abrogated thereby in respect of offences under
Section 138 of the Act of 1881. It may be noted
that this Court exercised power under Section 406
Cr.P.C. in relation to offences under Section 138 of
the Act of 1881 even during the time the original
Section 142 held the field. In A.E. Premanand
Vs. Escorts Finance Ltd. & Others [(2004) 13
SCC 527], this Court took note of the fact that the
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offences therein, under Section 138 of the Act of
1881, had arisen out of one single transaction and
found it appropriate and in the interest of justice
that all such cases should be tried in one Court.
We, therefore, hold that, notwithstanding the non
obstante clause in Section 142(1) of the Act of
1881, the power of this Court to transfer criminal
cases under Section 406 Cr.P.C. remains intact in
relation to offences under Section 138 of the Act of
1881, if it is found expedient for the ends of
justice.
14. In the case on hand, as the six
complaint cases pertain to the same transaction, it
would be advisable to have a common adjudication
to obviate the possibility of contradictory findings
being rendered in connection therewith by
different Courts. As four of the six cases have
been filed by the respondent company before the
Dwarka Courts at New Delhi and only 10 two such
cases are pending before the Courts at Nagpur,
Maharashtra, it would be convenient and in the
interest of all concerned, including the parties and
their witnesses, that the cases be transferred to
the Dwarka Courts at New Delhi."
8. In the light of the judgment rendered by the
Apex Court and the issue akin to what the Apex Court has
considered, the petition deserves to be succeed. For the
aforesaid reasons, the following:
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ORDER
The petition is allowed and the proceedings in C.C.
No.631/2018 pending on the file of III-Addl. JMFC, Sirsi at
Sirsi for the offence punishable under Section 138 of
N.I. Act is quashed. Liberty is reserved to the complainant
to imitate the proceedings in accordance with law, if
available in law.
Sd/-
JUDGE
Vnp*
