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2023 (5) TMI 799 - HC - Indian Laws


Issues involved:
Challenge to order under section 138 of the Negotiable Instruments Act, 1881 based on multiple grounds including maintainability of complaints arising from the same transaction, legality of recoverable liability, necessity of inquiry under section 202, and territorial jurisdiction of the Magistrate.

Maintainability of complaints:
The respondent filed two complaints for dishonour of cheques arising from the same transaction. The court held that under section 138 of the Negotiable Instruments Act, independent cause of action allows for the filing of separate complaints. The court emphasized that if the ingredients of section 138 are met, the Magistrate can issue process, regardless of complaints arising from the same agreement.

Legality of recoverable liability:
The petitioners argued that the cheques issued were of amounts exceeding the initial loan, suggesting no legally recoverable liability. The court pointed out that additional funds were sanctioned to the complainant, making the total amount legally recoverable a question of fact. Without clear evidence showing the amount is not legally recoverable, the court cannot accept the petitioners' submission at the stage of issuing process.

Necessity of inquiry under section 202:
The petitioners claimed that residing outside the Magistrate's jurisdiction required a mandatory inquiry under section 202, which was not conducted. Citing a Supreme Court ruling, the court explained that for complaints under section 138, witness examination is not always necessary. The court found that the Magistrate's prima facie satisfaction based on the complaint and affidavit of verification was sufficient, and any alleged defect in the inquiry under section 202 could be addressed during the affidavit of evidence.

Territorial jurisdiction of the Magistrate:
The petitioners raised concerns about the Magistrate's territorial jurisdiction due to complaints filed at different courts. The court clarified that jurisdiction is determined by the branch of the payee bank, as per section 142A of the Negotiable Instruments Act, 1881. Filing complaints at different locations does not automatically challenge the Magistrate's jurisdiction.

Validity of order and false averments:
Lastly, the petitioners disputed the validity of the order based on false statements in the complaint regarding a previous case. The court deemed the statement inconsequential to the merits of the case and upheld the validity of the order, ultimately dismissing the writ petition without costs.

 

 

 

 

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