Supreme Court upholds amendment to Negotiable Instruments Act, emphasizes legislative authority

The challenge to the amendment of Article 142(2) of the Negotiable Instruments Act was dismissed by the Supreme Court. The Court upheld the validity of the amendment introduced through the Negotiable Instruments (Amendment) Act, 2015, which altered the jurisdiction for trying offenses under Section 138. The Court affirmed the legislative authority to amend laws to align with policy objectives, emphasizing that legislation can supersede judicial decisions. The petition was dismissed, confirming the Parliament's competence to enact such amendments and highlighting the supremacy of legislative authority in addressing legal inconsistencies or policy considerations.

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Issues:
Challenge to amendment of Article 142(2) of the Negotiable Instruments Act based on conflicting judgments.

Analysis:
The main issue in this case is the challenge to the amendment of Article 142(2) of the Negotiable Instruments Act, which is contested on the grounds that it contradicts a previous judgment of the Supreme Court. The petitioner argues that the amendment nullifies the Supreme Court's ruling in Dashrath Rupsingh Rathod v. State of Maharastra. However, it is established in legal precedent that legislation can supersede judicial decisions, as seen in the case of Shri Prithvi Cotton Mills Ltd. v. Broach Borough Municipality.

The Supreme Court in Dashrath Rupsingh Rathod laid down the law regarding the place of suing for offenses under Section 138 of the Negotiable Instruments Act. The amendment in question was introduced through the Negotiable Instruments (Amendment) Act, 2015, which altered Section 142 of the Act. This amendment specifies the jurisdiction for inquiring into and trying offenses under Section 138, based on the location of the bank branch where the payee or holder maintains the account or where the drawer maintains the account.

The President of India promulgated an Ordinance, which later became the Negotiable Instruments (Amendment) Act, 2015, to address concerns arising from the Dashrath Rupsingh Rathod judgment. The amendment effectively removed the basis of the previous judgment, highlighting the legislative authority to modify laws to align with policy objectives. The validity of such amendments is well-established in legal principles, allowing the Legislature to amend laws to address inconsistencies or policy changes.

In conclusion, the Court found no fault in the amendment to Article 142(2) of the Negotiable Instruments Act. The Parliament's competence to enact such amendments is affirmed, and the amendment is deemed not to contravene the Constitution or be arbitrary. As a result, the writ petition challenging the amendment is dismissed, with no costs imposed. The judgment underscores the supremacy of legislative authority in amending laws to address legal inconsistencies or policy considerations.

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