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TMI Blog2010 (9) TMI 1229X X X X Extracts X X X X X X X X Extracts X X X X ..... It is averred in the complaint petition that the petitioner/complainant is a public limited company having its registered and corporate office at New Delhi and is dealing with the business of providing its customers various types of loans. It is further stated that the respondent/accused availed loan facility from the petitioner/complainant but the account became irregular. Towards discharge of part of the debts, the respondent/accused issued cheques, which when presented by the petitioner/complainant to its bankers namely, HDFC Bank Ltd., Connaught Place, New Delhi, were returned unpaid by the bankers of the accused under the return memo dated 29.12.2008, with the remarks, insufficient funds . The return memo was received by the petitioner/complainant at Delhi. In para 4 of the complaint, it is stated that the aforesaid cheques were submitted by the respondent/accused at the corporate and registered office of the complainant/petitioner. Thereafter, a legal demand notice was issued by the petitioner/complainant to the respondent/accused from Delhi, duly dispatched on 14.01.2009. As the respondent/accused failed to make the payments of the cheque amount, demanded through the legal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ave been gone into by the learned Metropolitan Magistrate at the pre-summoning stage, and the said aspect could have been considered and decided either ways, even after cognizance was taken. 6. In support of his submission that the averments contained in the complaint petition prima facie revealed that it was maintainable within the territorial jurisdiction of Delhi, counsel for the petitioner relied on the following judgments: i. K. Bhaskaran v. Sankaran Vaidhyan Balan and Anr. MANU/SC/0625/1999MANU/SC/0625/1999 : (1999) 7 SCC 510 ii. Trisuns Chemical Industry v. Rajesh Agarwal and Ors. MANU/SC/0581/1999MANU/SC/0581/1999 : (1999) 8 SCC 686. iii. Alchemist Ltd. v. State Bank of Sikkim MANU/SC/1290/2007MANU/SC/1290/2007 : (2007) 11 SCC 335 iv. Smt. Shamshad Begum v. B. Mohammed MANU/SC/8218/2008MANU/SC/8218/2008 : 2008 (13) SCALE 669 v. Rajiv Modi v. Sanjay Jain vi. Religare Finvest Limited v. Sambath Kumar A (2010) JCC (NI) 266 vii. Patiala Casting P. Ltd. and Ors. v. Bhushan Steel Ltd. 2010 IV AD (CRL)(DHC) 266. 7. Per contra, counsel for the respondent supports the impugned judgment and submits that the same does not deserve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Supreme Court observed as below: 11. We fail to comprehend as to how the trial court could have found so regarding the jurisdiction question. Under Section 177 of the Code every offence shall ordinarily be enquired into and tried in a court within whose jurisdiction it was committed . The locality where the bank (which dishonoured the cheque) is situated cannot be regarded as the sole criterion to determine the place of offence. It must be remembered that offence under Section 138 would not be completed with the dishonour of the cheque. It attains completion only with the failure of the drawer of the cheque to pay the cheque amount within the expiry of 15 days mentioned in Clause (c) of the proviso to Section 138 of the Act. It is normally difficult to fix up a particular locality as the place of failure to pay the amount covered by the cheque. A place, for that purpose, would depend upon a variety of factors. It can either be at the place where the drawer resides or at the place where the payee resides or at the place where either of them carries on business. Hence, the difficulty to fix up any particular locality as the place of occurrence for the offence under Section 13 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sts of several acts done in different local areas, it may be enquired into or tried by a court having jurisdiction over any of such local areas. 16. Thus it is clear, if the five different acts were done in five different localities any one of the courts exercising jurisdiction in one of the five local areas can become the place of trial for the offence under Section 138 of the Act. In other words, the complainant can choose any one of those courts having jurisdiction over any one of the local areas within the territorial limits of which any one of those five acts was done. As the amplitude stands so widened and so expansive it is an idle exercise to raise jurisdictional question regarding the offence under Section 138 of the Act. (emphasis added) 9. The aforesaid judgment thus clarifies that the five essential ingredients for completing the offence under Section 138 of the Act are as below: (i) Drawing of the cheque, (ii) Presentation of the cheque with the bank, (iii) Returning of the cheque unpaid by the drawee bank, (iv) Giving notice in writing to the drawer of the cheque demanding payment of the cheque amount, and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he is a Magistrate of the First Class his power to take cognizance of the offence is not impaired by territorial restrictions. After taking cognizance he may have to decide as to the court which has jurisdiction to enquire into or try the offence and that situation would reach only during the post-cognizance stage and not earlier. (emphasis added) 12. In the case of Rajiv Modi (supra), the Supreme Court formulated the following question for consideration: 10. The issue before us is, whether the High Court under Section 482 Cr.P.C. was justified in quashing the complaint on the ground that no cause of action has arisen in Patna in respect of the alleged offences under the provisions of IPC. 11. The learned Counsel for the appellant would submit, that, the cognizance stage and the trial stage are two different aspects of criminal jurisprudence and under the Code, there is no territorial restriction for any Magistrate to take cognizance of an offence although at the stage of trial, the said issue may become relevant in view of the provisions of Chapter XIII of the Code. The Counsel would also assert that Section 177 of the Code relating to the jurisdiction of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ascertain that the allegations made are true in fact. (emphasis added) 14. The attention of this Court has been drawn to the two recent decisions of Single Benches of this Court in the cases of Religare Finvest Limited v. Sambath Kumar A reported as (2010) JCC (NI) 266 and Patiala Casting P. Ltd. and Ors. v. Bhushan Steel Ltd. reported as 2010 IV AD (CRL) 266. In both the cases, the Single Benches noticed the judgment in the case of Harman Electronics (supra), and held that mere sending of notice from Delhi would itself not give rise to a cause of action in Delhi, for taking cognizance under the Act and the said act ought to be accompanied by some other act(s), for vesting territorial jurisdiction in a particular court. In the case of Religare Finvest Limited (supra), the Single Judge also considered the judgment in the cases of Mosaraf Hossain Khan v. Bhagheeratha Engg. Ltd. reported as MANU/SC/8067/2006MANU/SC/8067/2006 : (2006) 3 SCC 658 and Lok Housing and Constructions Limited v. Raghupati Leasing and Finance Limited and Anr. reported as MANU/DE/0978/2002MANU/DE/0978/2002 : 100 (2002) DLT 38 to hold that a complaint under Section 138 of the Act could be filed in any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mount within the expiry of the fifteen days after the legal notice is served upon the drawer of the cheque/s whose cheques have been dishonoured. As noted above, the offence under Section 138 of the Act can be completed only with the concatenation of a number of acts, the acts being, drawing of the cheque, presentation of the cheque with the bank, returning of the cheque unpaid by the drawee bank, giving notice in writing to the drawer of the cheque demanding payment of the cheque amount, and failure of the drawer to make payment within 15 days of the receipt of the notice. It is not essential that all the acts should be committed at the same locality. It is quite possible that all the five acts are perpetrated in five different localities. In such a situation, any one of the courts exercising jurisdiction in one of the five localities can become the place of trial for the offence under Section 138 of the Act. At the stage of entertaining a complaint under Section 138 of the Act, the Court is only required to arrive at a prima facie opinion as to the territorial jurisdiction, on the basis of the averments made therein, without launching into a fact finding mission as to their corre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bearing on the issue of territorial jurisdiction to entertain a complaint by a particular court. 20. In the case of Harman Electronics (supra), the Supreme Court particularly noted in paras 12 and 13 of the judgment that the complaint/petition did not show that the cheques were presented at Delhi and rather, the petition was completely silent on that aspect. Having regard to the facts and circumstances of the aforesaid case, where it was observed that the parties had been carrying on business at Chandigarh, the transactions took place at Chandigarh, the cheques were issued and presented at Chandigarh, the Supreme Court had observed that it had no option but to presume that the cheques were also presented at Chandigarh and dishonour of the cheques took place at Chandigarh and hence, mere sending of notice from Delhi itself would not give rise to a cause of action for taking cognizance under the Act. In the present case, mere issuance of a legal notice by the petitioner/complainant from Delhi alone is not the sole basis for filing the complaint in the territorial jurisdiction of Delhi. As noted in para (3) above, there were certain other acts, which were done within the territori ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 23. In the present case, the Negotiable Instruments Act is the substantive statute and the procedural aspect of filing of the complaint, and dealing with the procedures to be followed by the trial court thereafter are all governed under the procedural law, i.e., the Code of Criminal Procedure. Hence, reference to Chapter XIII of the Code of Criminal Procedure, which deals with jurisdiction of criminal courts, is but natural. Section 177 relates to ordinary place of inquiry and trial, Section 178 relates to place of inquiry or trial and Section 179 relates to offence triable where act is done or consequence ensues. All the aforesaid three provisions have been particularly explained by the Supreme Court in the case of K. Bhaskaran (supra), as noted above. Therefore, reading of the Negotiable Instruments Act in isolation, dehors the procedure prescribed in the Cr.P.C., for dealing with the filing of the complaint and the manner of proceeding with the complaint, is neither possible, nor permissible. 24. As discussed above, the Magistrate taking cognizance of an offence must not necessarily have the territorial jurisdiction to try the case as well. Only when an enquiry or trial be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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