2025 (3) TMI 374 - SC - Indian Laws

Dishonour of Cheque - prayer to transfer Criminal Case pending in the court of Judicial Magistrate Ist Class Chandigarh (UT) to the court of Metropolitan Magistrate Coimbatore Tamil Nadu essentially on the ground that no cause of action could be said to have arose for the bank to lodge the complaint for the offence punishable under Section 138 of the Negotiable Instruments Act 1881 - lack of territorial jurisdiction of the court in which the complaint is filed - exercise of powers under Section 406 of the Cr.P.C. to transfer the said complaint to the court having territorial jurisdiction to try the offence - expression that for the ends of justice this Court can transfer any criminal case or appeal to any place. in Section 406 Cr.P.C. embraces in itself the lack of territorial jurisdiction of the court to try the offence under Section 138 N.I. Act. HELD THAT -This court in the case of Yogesh Upadhaya and Another v. Atlanta Limited 2023 (2) TMI 884 - SUPREME COURT had the occasion to consider the plea for transfer filed under Section 406 Cr.P.C. in connection with six complaint cases filed under Section 138 and 142 of the N.I. Act respectively. While considering the plea for transfer the court had the opportunity to consider Section 142(2) contained in the statute book along with Section 142-A. Further reliance placed on Dashrath Rupsingh Rathod v. State of Maharashtra 2014 (8) TMI 417 - SUPREME COURT wherein it was 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. The Court after examining the Statement of Objects and Reasons in the N.I. Amendment Act 2015 stated that the insertion of Sections 142(2) and 142-A in the N.I. Act was a direct consequence of the judgment in Dashrath Rupsingh Rathod 2014 (8) TMI 417 - SUPREME COURT . Section 142(2) now makes it clear that the jurisdiction to try such an offence would vest only in 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 came into force. The Court noted that the non obstante clause was already present in the original Section 142(1) and was not introduced by way of the amendments in the year 2015 along with Section 142(2). The non obstante clause merely has reference to the manner in which cognizance is to be taken in an offence under Section 138. The same must not be construed to mean that the power of this Court to transfer pending criminal proceedings under Section 406 CrPC stands abrogated thereby in respect of an offence under Section 138 of the NI Act. A case is transferred by virtue of the powers under Section 406 if there is a reasonable apprehension on the part of a party to a case that justice will not be done. There however must be reliable material from which it can be inferred that there are impediments that are interfering or likely to interfere either directly or indirectly with the cause of justice. A proceeding which is void under Section 461 cannot be saved by Section 462 - HELD THAT - The focus of clause (l) of Section 461 18 is on the offender and not on the offence . If clause (l) had used the words tries an offence rather than the words tries an offender the consequence might have been different - the jurisdiction of a criminal Court is normally relatable to the offence and in some cases to the offender such as cases where the offender is a juvenile (section 27) or where the victim is a women the proviso to clause (a) of section 26 . But Section 461(l) focuses on the offender and not on the offence. The saving clause contained in Section 462 of the Code of 1973 is in pari materia with Section 531 of the Code of 1898. The transfer of cases under Section 406 Cr.P.C. may be allowed when there is a reasonable apprehension backed by evidence that justice may not be done and mere convenience or inconvenience of the parties may not by itself be sufficient enough to pray for transfer. The court has to appropriately balance the grounds raised in the facts and circumstances of each case and exercise its discretion in a circumspect manner while ordering a transfer under Section 406. In Maneka Sanjay Gandhi it was held that as a general rule it is the complainant who has the right to choose the forum that has jurisdiction over the subject matter and the courts do not interfere with such a right unless circumstances that hamper the ends of justice are brought to the notice of the court by the other party. Section 142 of the N.I. Act in clear terms provides the complainant with the right to lodge a complaint before a court within whose jurisdiction the branch of the bank where the cheque is delivered for collection is situated. Therefore the argument of the accused that another court might also be empowered to take cognizance of the matter under Section 142 since the cause of action arose within that jurisdiction cannot by itself be a ground for seeking transfer under Section 406 of the Cr.P.C. A conjoint reading of Section 142(2)(a) along with the explanation thereof makes the position emphatically clear that when a cheque is delivered or issued to a person with liberty to present the cheque for collection at any branch of the bank where the payee or holder in due course as the case may be maintains the account then the cheque shall be deemed to have been delivered or issued to the branch of the bank in which the payee or holder in due course as the case may be maintains the account and the court of the place where such cheque was presented for collection will have the jurisdiction to entertain the complaint alleging the commission of offence punishable under Section 138 of the N.I. Act. In that view of the position of law the word delivered used in Section 142(2)(a) of the N.I. Act has no significance. What is of significance is the expression for collection through an account . That is to say delivery of the cheque takes place where the cheque was issued and presentation of the cheque will be through the account of the payee or holder in due course and the said place is decisive to determine the question of jurisdiction. For the purpose of transfer of any case or proceedings under Section 406 of the Cr.P.C. the case must fall within the ambit of the expression expedient for the ends of justice . Mere inconvenience or hardship that the accused may have to face in travelling from Coimbatore to Chandigarh would not fall within the expression expedient for the ends of justice . The case must fall within any of the five situations as narrated in para 49 of this judgment. It is always open for the petitioner accused to pray for exemption from personal appearance or request the Court that he may be permitted to join the proceedings online. Conclusion - No case is made out for transfer of the proceedings in question under 406 CrPC. Petition dismissed.

Summary

1. ISSUES PRESENTED and CONSIDERED

The Court considered the following core legal questions:

i. Whether a complaint filed under Section 138 of the N.I. Act can be transferred from one court to another under Section 406 of the Cr.P.C. due to lack of territorial jurisdiction?

ii. If the court where the complaint under Section 138 of the N.I. Act was filed lacks territorial jurisdiction, can the Supreme Court transfer the case to the appropriate jurisdiction under Section 406 of the Cr.P.C.?

iii. Does the expression "for the ends of justice" in Section 406 Cr.P.C. include lack of territorial jurisdiction for offences under Section 138 of the N.I. Act?

2. ISSUE-WISE DETAILED ANALYSIS

Issue i: Transfer of Complaint Due to Lack of Territorial Jurisdiction

- Relevant legal framework and precedents: Section 138 of the N.I. Act outlines the offence of cheque dishonour, while Section 142 specifies the court's jurisdiction for such offences. Section 406 of the Cr.P.C. allows the Supreme Court to transfer cases for the ends of justice.

- Court's interpretation and reasoning: The Court noted that the jurisdiction to try offences under Section 138 is determined by where the cheque is delivered for collection or presented for payment. The Court emphasized that the territorial jurisdiction is not solely a matter of convenience but is defined by statutory provisions.

- Key evidence and findings: The Court found that the complaint was filed in Chandigarh because the cheque was presented there for collection, which is permissible under Section 142(2) of the N.I. Act.

- Application of law to facts: The Court applied the statutory framework to determine that the filing of the complaint in Chandigarh was legally permissible, thereby negating the argument for transfer based on lack of jurisdiction.

- Treatment of competing arguments: The petitioner argued for transfer based on convenience and alleged harassment, while the respondent bank maintained the legal basis for filing in Chandigarh. The Court found the bank's position consistent with statutory provisions.

- Conclusions: The Court concluded that the complaint's filing in Chandigarh was legally valid and did not warrant transfer based on jurisdictional grounds.

Issue ii: Transfer Under Section 406 Cr.P.C.

- Relevant legal framework and precedents: Section 406 Cr.P.C. allows for transfer of cases to ensure justice. The Court reviewed precedents where transfers were allowed for reasons beyond mere convenience.

- Court's interpretation and reasoning: The Court emphasized that transfer under Section 406 should be based on substantial grounds that impact the ends of justice, not merely on convenience or language barriers.

- Key evidence and findings: The Court found no substantial evidence that justice would be compromised if the case remained in Chandigarh.

- Application of law to facts: The Court determined that the petitioner's arguments did not meet the threshold for transfer under Section 406, as they were primarily based on convenience rather than justice.

- Treatment of competing arguments: The Court weighed the petitioner's claims of inconvenience against the statutory framework and found the latter to be more compelling.

- Conclusions: The Court concluded that the petitioner's request for transfer did not satisfy the criteria under Section 406 Cr.P.C.

Issue iii: Interpretation of "Ends of Justice"

- Relevant legal framework and precedents: The Court examined the meaning of "ends of justice" in the context of procedural law and previous rulings.

- Court's interpretation and reasoning: The Court interpreted "ends of justice" to mean justice for all parties involved and not merely convenience for one party.

- Key evidence and findings: The Court found that the petitioner's arguments did not demonstrate a failure of justice that would necessitate a transfer.

- Application of law to facts: The Court applied the principle that the statutory right to choose a forum should not be overridden without compelling reasons.

- Treatment of competing arguments: The Court considered the petitioner's claim of harassment but found no substantial evidence to support a transfer for the ends of justice.

- Conclusions: The Court concluded that the petitioner's request did not align with the principles of justice as interpreted under Section 406 Cr.P.C.

3. SIGNIFICANT HOLDINGS

- Verbatim quotes of crucial legal reasoning: "The jurisdiction to try such an offence would vest only in 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."

- Core principles established: The Court reaffirmed that territorial jurisdiction under the N.I. Act is defined by statutory provisions and not merely by convenience. Transfer under Section 406 Cr.P.C. requires substantial grounds impacting justice, not just convenience.

- Final determinations on each issue: The Court dismissed the transfer petition, upholding the statutory framework for jurisdiction under the N.I. Act and the criteria for transfer under Section 406 Cr.P.C.