TaxTMI 
TaxTMI 
TaxTMI 
2026 (1) TMI 16
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....he overdraft facility was not serviced, and in April 2023, the Bank declared the account as a Non-Performing Asset (NPA). 3. Respondent Bank initiated proceedings under the SARFAESI Act, 2002 [Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. Hereinafter, 'SARFAESI Act'.], which were challenged by the petitioners before the Debt Recovery Tribunal at Hyderabad [S.A. No. 397 of 2023] (DRT). Respondent Bank also instituted OA No. 787 of 2023 under Section 19(4) of Recovery of Debts and Bankruptcy Act, 1993 ['RDB Act'.] before the DRT. Proceedings were also instituted before the High Court of Andhra Pradesh challenging the respondent Bank's decision to declare the firm's account as NPA [W.P. No. 16295 of 2024.] 4. In the meanwhile, cheques issued by Petitioner No.(s) 1 and 2, amounting to Rs.3 crores and Rs.6 crores respectively, drawn on their accounts maintained at Adoni branch of HDFC Bank and respondent Bank, were presented by respondent Bank at Chandigarh. Upon dishonour of the said cheques, subject criminal proceedings [Complaint No. 23195 of 2023 and Complaint No. 23197 of 2023.] under Section 138 of the Negotiable Instru....
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....10., this Court interpreted the import of these provisions in relation to offence under Section 138 of N.I. Act, and held as follows: "14. The offence under Section 138 of the Act can be completed only with the concatenation of a number of acts. The following are the acts which are components of the said offence: (1) drawing of the cheque, (2) presentation of the cheque to the bank, (3) returning the cheque unpaid by the drawee bank, (4) giving notice in writing to the drawer of the cheque demanding payment of the cheque amount, (5) failure of the drawer to make payment within 15 days of the receipt of the notice. 15. It is not necessary that all the above five acts should have been perpetrated at the same locality. It is possible that each of those five acts could be done at five different localities. But a concatenation of all the above five is a sine qua non for the completion of the offence under Section 138 of the Code. In this context a reference to Section 178(d) of the Code is useful. It is extracted below: "178. (a)-(c)*** (d) where the offence consists of several acts done in different local ....
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....ce at all material times. (2) Notwithstanding anything contained in sub-section (2) of section 142 or sub-section (1), where the payee or the holder in due course, as the case may be, has filed a complaint against the drawer of a cheque in the court having jurisdiction under subsection (2) of section 142 or the case has been transferred to that court under sub-section (1) and such complaint is pending in that court, all subsequent complaints arising out of section 138 against the same drawer shall be filed before the same court irrespective of whether those cheques were delivered for collection or presented for payment within the territorial jurisdiction of that court. (3) If, on the date of the commencement of the Negotiable Instruments (Amendment) Act, 2015 (26 of 2015), more than one prosecution filed by the same payee or holder in due course, as the case may be, against the same drawer of cheques is pending before different courts, upon the said fact having been brought to the notice of the court, such court shall transfer the case to the court having jurisdiction under sub-section (2) of section 142, as amended by the Negotiable Instruments (Amendmen....
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....nery or prosecution is acting hand in glove with the accused, and there is likelihood of miscarriage of justice due to the lackadaisical attitude of the prosecution; (ii) when there is material to show that the accused may influence the prosecution witnesses or cause physical harm to the complainant; (iii) comparative inconvenience and hardships likely to be caused to the accused, the complainant/the prosecution and the witnesses, besides the burden to be borne by the State exchequer in making payment of travelling and other expenses of the official and non-official witnesses; (iv) a communally surcharged atmosphere, indicating some proof of inability in holding a fair and impartial trial because of the accusations made and the nature of the crime committed by the accused; and (v) existence of some material from which it can be inferred that some persons are so hostile that they are interfering or are likely to interfere, either directly or indirectly, with the course of justice. (emphasis supplied) 15. In the present case, though the complaints have been filed before the appropriate jurisdictional court at Chandigarh upon the cheques....
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....r transfer. 17. It may not be out of place to note parameter (iii) in Nahar Singh Yadav (supra) enumerates "a comparative inconvenience and hardship likely to be caused to the accused, complainant and witnesses" including financial burden caused to the State exchequer for travel of official & non-official witnesses as a relevant ground for transfer. Prayers for transfer are, therefore, not agnostic to inconvenience/hardship and ought to be tested on the scale of relative convenience/inconvenience of all stakeholders including witnesses. 18. We have tested the prayer for transfer in light of the afore-stated legal proposition. ANALYSIS 19. Petitioners are facing prosecution under Section 138 of the N.I. Act. Section 138 of the N.I. Act was incorporated in order to promote financial discipline and credibility of banking systems. Penal liability was introduced to ensure confidence in transactions through negotiable instruments. It is essentially an offence against an individual, compoundable at his option, and not against the State. The nature of the offence is quasi-criminal and does not fall within the species of grave crimes like murder, rape and corruption etc. which m....
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....e and shakes the foundation of constitutional guarantees to fair trial. 24. But such inconvenience/hardship in securing legal representation and effective defence cannot be seen in isolation. They must be weighed on a balancing scale against the complainant's right to access justice in a court prescribed by law. The convenience/inconvenience paradigm essentially rests on the relative status and wherewithal of parties to the lis. In the event the parties are co-equal in status and socio-economic standing, the court may be shy to transfer a case solely for the convenience of legal representation and defence of the accused, since such a shift, though welcome from the end of the accused, would cause undue hardship to the complainant. On the other hand, if the battle is between two unequal parties i.e., the complainant, a large corporation and the accused, a puny individual with limited means, a transfer of the proceedings to secure adequate legal representation to such an accused would hardly impact the giant corporation's right to access justice. It is little solace for the accused to be told that he may be represented under Section 228 BNSS (corresponding to Section 205 CrPC) thro....