The Aryavarth Express
Agency(New Delhi): The Supreme Court took a significant step in a case involving the territorial jurisdiction for filing cheque dishonour complaints, particularly in light of amendments to the Negotiable Instruments Act. Justices CT Ravikumar and Aravind Kumar decided to implead the Union of India, suggesting the need for a comprehensive examination of the amendments made to Section 142A of the Act.
The central question before the Court is whether, after the 2015 amendment which specifies that a complaint can only be filed in the jurisdiction of the bank of the payee or holder, the Supreme Court can still transfer a case to the jurisdiction where the drawer’s bank is located, despite the statute’s restrictions.
This issue gained prominence following the Supreme Court’s 2014 ruling in *Dasrath Rupsingh Rathod v State of Maharashtra*, which restricted filing jurisdictions to where the cheque was dishonoured. This decision overruled earlier interpretations that allowed complaints to be filed in multiple jurisdictions, creating confusion and prompting the 2015 legislative amendment.
The 2015 amendment aimed to simplify jurisdictional issues by stipulating that cases must be initiated only in the jurisdiction of the bank where the payee presents the cheque. However, this amendment has been challenged on the grounds that it potentially violates Articles 14 and 21 of the Constitution by limiting the drawer’s (accused’s) access to a fair trial, as argued by Senior Advocate Siddharth Luthra, appointed as Amicus Curiae.
Luthra contended that the amendment unfairly favors the payee or holder by allowing them to choose the jurisdiction, potentially creating hardship for the drawer who must defend themselves possibly far from their local jurisdiction. He also highlighted the potential for abuse, noting that the amendment does not specify when the payee’s account must have been established, allowing jurisdiction to be manipulated by the timing of account creation.
