2018 (7) TMI 2226 - HC - Indian Laws

Dishonor of Cheque - cheques when presented at the bank were returned unpaid and inspite of notice of demand, the petitioner did not pay the amount - Territorial Jurisdiction - Section 138 of the Negotiable Instruments Act, 1881 - HELD THAT - The question of territorial jurisdiction is rendered academic for the simple reason the averments in the complaints themselves endorse the objection of the petitioner that no charge for offence under Section 138 of the Negotiable Instruments Act, 1881 can be brought against him with regard to the mentioned three cheques since they were issued as security cheques. In view of admitted position of the complainant, the summoning order against the petitioner on their basis is found to be incorrect and wrong exercise of jurisdiction - application allowed.

Summary

Issues:
1. Jurisdiction of the court to quash proceedings in complaint cases under Section 482 of the Code of Criminal Procedure, 1973.
2. Allegations of offense under Section 138 of the Negotiable Instruments Act, 1881 regarding security cheques issued by the accused.
3. Incorrect summoning order against the petitioner based on the nature of the cheques issued.

Analysis:
1. The petitioner sought quashing of proceedings in two complaint cases under Section 482 of the Code of Criminal Procedure, 1973, alleging abuse of the court's process. The petitioner argued that the court in Delhi lacked jurisdiction as the acts in question occurred in Ahmedabad. However, the court found the issue of territorial jurisdiction irrelevant due to the nature of the cheques issued. The complaints themselves acknowledged that the cheques were issued as security, not for the discharge of any debt or liability.

2. The complaints stated that the accused had issued signed blank cheques as security, with the understanding that they would be deposited if the amount was not returned within a specified period. The court noted that the complainant's own averments confirmed that the cheques were security cheques, not intended for immediate payment. As a result, the summoning order against the petitioner based on these security cheques was deemed incorrect and a wrongful exercise of jurisdiction.

3. Given the admitted position of the complainant regarding the nature of the cheques issued, the court allowed the petitions and applications filed by the petitioner. Consequently, the court quashed the proceedings in the criminal complaint cases against the petitioner. The judgment highlighted the importance of accurately assessing the nature and purpose of the cheques issued in cases involving allegations under Section 138 of the Negotiable Instruments Act, 1881.