Application to Quash Proceedings Denied: Mumbai Magistrate's Jurisdiction Upheld

The application to quash the proceedings under Section 482 of the Cr.P.C. was rejected by the court. The court affirmed the jurisdiction of the Mumbai Magistrate in a case involving dishonored cheques under the Negotiable Instruments Act. The court held that the mandatory enquiry under Section 202 of the Cr.P.C. was not necessary as there was sufficient material to justify the issuance of process. The court emphasized that key components of the offence occurred in Mumbai, supporting the Magistrate's territorial jurisdiction. The trial court was directed not to consider observations on the execution of the agreement due to lack of original documentation.

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Issues: (i) Whether inquiry under Section 202 of the Code of Criminal Procedure, 1973 was mandatory before issuance of process against an residing outside the local jurisdiction; (ii) Whether the Metropolitan Magistrate at Mumbai had territorial jurisdiction to entertain the complaint under Section 138 of the Negotiable Instruments Act, 1881.

Issue (i): Whether inquiry under Section 202 of the Code of Criminal Procedure, 1973 was mandatory before issuance of process against an accused residing outside the local jurisdiction.

Analysis: The complaint was supported by the agreements, the dishonoured cheques, documents showing presentation and return of the cheques, and the verification statement of the complainant's officer. That material was sufficient for the Magistrate to form a prima facie view for issuance of process. The object of the provision is to prevent mechanical issuance of process in cases involving accused residing beyond jurisdiction, but it does not require a full trial-like examination of all witnesses at the threshold where sufficient material already exists.

Conclusion: The absence of a further inquiry under Section 202 did not vitiate the issuance of process.

Issue (ii): Whether the Metropolitan Magistrate at Mumbai had territorial jurisdiction to entertain the complaint under Section 138 of the Negotiable Instruments Act, 1881.

Analysis: The original agreement for trade finance was executed at Mumbai, funds were disbursed from Mumbai, the statutory notice was issued from Mumbai, and payment was required to be made there. In addition, the offence under Section 138 consists of multiple components, and jurisdiction can lie where any of the components occurs. On the facts, at least the foundational transaction and the final components connected with notice and non-payment were linked to Mumbai, so the jurisdictional objection could not succeed.

Conclusion: The Mumbai court had territorial jurisdiction to try the complaint.

Final Conclusion: The challenge to the criminal proceedings failed on both the procedural objection under Section 202 and the objection to territorial jurisdiction, and the application was rejected.

Ratio Decidendi: In a complaint under Section 138 of the Negotiable Instruments Act, 1881, the Magistrate need not undertake an exhaustive inquiry under Section 202 of the Code of Criminal Procedure, 1973 where the complaint and supporting material already disclose a prima facie case, and territorial jurisdiction may exist where material components of the offence and the underlying transaction are connected with the forum.

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