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2020 (1) TMI 385 - HC - Indian LawsDishonor of cheque - Legality of Amendment to Article 142(2) of the Negotiable Instruments Act - challenge made primarily on the ground that the amendment goes completely contrary to the judgment of the Honourable Supreme Court in DASHRATH RUPSINGH RATHOD VERSUS STATE OF MAHARASHTRA ANOTHER 2014 (8) TMI 417 - SUPREME COURT where it was held that Once the cause of action accrues to the complainant, the jurisdiction of the Court to try the case will be determined by reference to the place where the cheque is dishonoured. HELD THAT - By virtue of the said amendment, the entire basis of the judgment of Dashrath Rupsingh Rathod has been removed. The power of the Legislature to take away the basis of a judgment by making amendments is well settled. It is trite law that the Legislature can take away the basis of the judgment of a judicial pronouncement by either passing a Validating Act or passing amendments to the parent Act - Reference can be made to the case of STATE OF KARNATAKA ETC. VERSUS M/S PRO LAB ORS. ETC. 2015 (2) TMI 388 - SUPREME COURT and STATE BANK'S STAFF UNION MADRAS VERSUS UNION OF INDIA ORS 2005 (9) TMI 650 - SUPREME COURT . Thus, there is no infirmity in the amendment. Even otherwise, the Parliament is competent to bring out the amendment under the Negotiable Instruments Act. The said amendment cannot be said to be ultra vires in view of the provisions of the Act or Part III of the Constitution of India. The amendment cannot also be called to be manifestly arbitrary in the absence of any materials on record. Petition dismissed.
Issues:
Challenge to amendment of Article 142(2) of the Negotiable Instruments Act based on conflicting judgments. Analysis: The main issue in this case is the challenge to the amendment of Article 142(2) of the Negotiable Instruments Act, which is contested on the grounds that it contradicts a previous judgment of the Supreme Court. The petitioner argues that the amendment nullifies the Supreme Court's ruling in Dashrath Rupsingh Rathod v. State of Maharastra. However, it is established in legal precedent that legislation can supersede judicial decisions, as seen in the case of Shri Prithvi Cotton Mills Ltd. v. Broach Borough Municipality. The Supreme Court in Dashrath Rupsingh Rathod laid down the law regarding the place of suing for offenses under Section 138 of the Negotiable Instruments Act. The amendment in question was introduced through the Negotiable Instruments (Amendment) Act, 2015, which altered Section 142 of the Act. This amendment specifies the jurisdiction for inquiring into and trying offenses under Section 138, based on the location of the bank branch where the payee or holder maintains the account or where the drawer maintains the account. The President of India promulgated an Ordinance, which later became the Negotiable Instruments (Amendment) Act, 2015, to address concerns arising from the Dashrath Rupsingh Rathod judgment. The amendment effectively removed the basis of the previous judgment, highlighting the legislative authority to modify laws to align with policy objectives. The validity of such amendments is well-established in legal principles, allowing the Legislature to amend laws to address inconsistencies or policy changes. In conclusion, the Court found no fault in the amendment to Article 142(2) of the Negotiable Instruments Act. The Parliament's competence to enact such amendments is affirmed, and the amendment is deemed not to contravene the Constitution or be arbitrary. As a result, the writ petition challenging the amendment is dismissed, with no costs imposed. The judgment underscores the supremacy of legislative authority in amending laws to address legal inconsistencies or policy considerations.
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