Supreme Court DecisionsNegotiable Instrument Act Ordinance 2015 is Retrospective : SC

December 4, 20150

In the matter of M/S BRIDGESTONE INDIA PVT. LTD. Vs INDERPAL SINGH & Ors, under Criminal Appeal No.1557 of 2015 (Arising out of SLP(Crl.)No.7850 of 2011, a  two Judge Bench of the Supreme Court comprising of Justices J.S.Khehar and R.Banumati has held that

A perusal of the amended Section 142(2), extracted above, leaves no room for any doubt, specially in view of the explanation thereunder, that with reference to an offence under Section 138 of the Negotiable Instruments Act, 1881, the place where a cheque is delivered for collection i.e. the branch of the bank of the payee or holder in due course, where the drawee maintains an account, would be determinative of the place of territorial jurisdiction.

The bench further held that

We are in complete agreement with the contention advanced at the hands of the learned counsel for the appellant. We are satisfied, that Section 142(2)(a), amended through the Negotiable Instruments (Amendment) Second Ordinance, 2015, vests jurisdiction for initiating proceedings for the offence under Section 138 of the Negotiable Instruments Act, inter alia in the territorial jurisdiction of the Court, where the cheque is delivered for collection (through an account of the branch of the bank where the payee or holder in due course maintains an account). We are also satisfied, based on Section 142A(1) to the effect, that the judgment rendered by this Court in Dashrath Rupsingh Rathod’s case, would not stand in the way of the appellant, insofar as the territorial jurisdiction for initiating proceedings emerging from the dishonor of the cheque in the present case arises.

In light of this decision of SC of India , the Negotiable Instrument Act Ordinance 2015 is Retrospective in operation .

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