SC held that, for an offence under S. 138 NI Act, mere issuance of statutory notice does not confer jurisdiction; cause of action arises only upon receipt of notice by the drawer. Further, the offence is committed where the drawee bank dishonours the cheque, and territorial jurisdiction lies with the court within whose limits that bank is situated. Interpreting S. 142(2)(a) and its Explanation, SC clarified that the branch where the payee deposits the cheque for collection, including a non-home branch, is deemed the relevant branch for jurisdiction. To prevent hardship from forum manipulation and applying these principles, SC concluded that the complaint could not be tried at Bhopal and ordered transfer of the pending proceedings to the competent MM at Kolkata, allowing the transfer petition.
SC held that, for an offence under S. 138 NI Act, mere issuance of statutory notice does not confer jurisdiction; cause of action arises only upon receipt of notice by the drawer. Further, the offence is committed where the drawee bank dishonours the cheque, and territorial jurisdiction lies with the court within whose limits that bank is situated. Interpreting S. 142(2)(a) and its Explanation, SC clarified that the branch where the payee deposits the cheque for collection, including a non-home branch, is deemed the relevant branch for jurisdiction. To prevent hardship from forum manipulation and applying these principles, SC concluded that the complaint could not be tried at Bhopal and ordered transfer of the pending proceedings to the competent MM at Kolkata, allowing the transfer petition.
Note: It is a system-generated summary and is for quick reference only.
TaxTMI 
TaxTMI 
of 4819 
Join Channel 
