Approach to be Adopted by Judicial Officers in Cases of Cheque Dishonour under S.138 of Negotiable Instruments Act, 1881

Approach to be Adopted by Judicial Officers in Cases of Cheque Dishonour under S.138 of Negotiable Instruments Act, 1881 

Section 138 - Approach of Trial Courts - A word of advise needs to be given to the trial courts, who are dealing with cases like the present ones. The advise is that after taking cognizance of the offence under the Negotiable Instruments Act, 1881, it is not open to them to suo motu throw out the criminal complaints abruptly by declaring that they do not have the territorial jurisdiction to deal with the matter. Adoption of such a course is strictly prohibited. - ICICI Bank Ltd v. Subhash Chand Bansal [2009] GCtR 6479 (Delhi)

Section 138 - Territorial Jurisdiction - Forum Hunting - It was argued by "Z" that place of drawing of cheque, its presentation, its return, place of giving of notice and place of failure of drawer to make the payment would have the jurisdiction to entertain a complaint under section 138 of Negotiable Instruments Act, 1881, pertaining to bouncing of cheque and the complaint can be filed at any one of the five places and the choice will be of the Complainant - Held, "for commission of an offence under section 138 of Negotiable Instruments Act, 1881, notice must be received by the accused". - "However, there may be a case, where the accused would have shifted his residence outside the territorial jurisdiction of the court concerned, but then, in such a case, the court in whose territorial jurisdiction drawee bank, (i.e., banker of the accused) is situated would have the territorial jurisdiction to entertain the complaint in question. Therefore, the place where an offence has been committed plays an important role" - Held, "financial institutions, ought not to be permitted to do forum hunting as per their convenience, much to the grave harassment of the accused and a balance has to be struck."  - It had transpired that criminal complaints pertain to cheque amounts ranging from Rs.1,500/- to Rs.4,500/- only in certain matters - Held, in such like cases, it would be too harsh upon a Respondent/accused to come to Delhi from far of places and to face the proceedings under section 138 of Negotiable Instruments Act, 1881, merely because Petitioner chooses to file the complaints under the aforesaid Act in Delhi. - "It is a hard reality that the financial institutions, like the Petitioner, have made Delhi Courts a dumping ground for filing of criminal complaints under section 138 of NI Act, 1881" - Some actions of Financial institutions has resulted in choking of the Delhi criminal courts seized with such like matters.- ICICI Bank Ltd v. Subhash Chand Bansal [2009] GCtR 6479 (Delhi)