Jai Balaji Industries Ltd. And Ors. Vs HEG Ltd. (Supreme Court of India)
SC Clarifies NI Act Jurisdiction: Only Payee’s Home-Branch Court Can Try 138 Cases After 2015 Amendment; Forum Shopping Ends: Supreme Court Fixes Clear Jurisdiction Rule for Cheque Dishonour Prosecutions; Delivery vs Presentment: SC Settles Confusion on Territorial Jurisdiction under Section 142(2)
The Supreme Court examined whether the complaint for dishonour of cheque should be tried at Kolkata or Bhopal after the 2015 amendment to the NI Act. The cheque issued by the accused company at Kolkata was deposited by the complainant in its SBI Bhopal account, dishonoured, statutory notice issued, & complaint initially filed before MM, Kolkata where summons & evidence-in-chief had commenced. After the 2015 Amendment Act inserting Section 142(2), MM Kolkata returned the complaint for re-presentation before JMFC Bhopal on the ground that jurisdiction lies at the place where the payee maintains his account. The accused sought transfer back to Kolkata relying on Dashrath Rupsingh Rathod & arguing that evidence had already commenced.
Supreme Court undertook an exhaustive analysis of Bhaskaran, Harman Electronics & Dashrath Rupsingh Rathod, & thereafter explained the post-2015 legal position. Court held that Section 142(2)(a) mandates that where a cheque is “delivered for collection through an account”, jurisdiction lies exclusively with the court within whose local limits the branch of the payee’s bank where he “maintains an account” is situated. Delivery to any branch is deemed delivery to the home branch by virtue of the Explanation.
