Whether the court, where the cheque was presented through an account maintained by the payee/holder for collection, has jurisdiction to entertain the complaint alleging commission of offence under Section 138 of Negotiable Instruments (NI) Act, 1881? – Alfa One Global Builders Pvt. Ltd. Vs. Nirmala Padmanabhan – Kerala High Court
Hon’ble High Court held that:
(i) To be on the core issue, reading Section 142(2) (a) and the explanation to clause (a), it is emphatically clear that, for the purposes of clause (a), where a cheque is delivered for collection at any branch of the bank of the payee or holder in due course, then, the cheque shall be deemed to have been delivered to the branch of the bank in which the payee or holder in due course, as the case may be, maintains the account.
(ii) A conjoint reading of Section 142(2)(a) along with explanation thereof, makes the position emphatically clear that, when a cheque is delivered or issued to a person with liberty to present the cheque for collection at any branch of the bank where the payee or holder in due course, then, the cheque shall be deemed to have been delivered or issued to the branch of the bank, in which, the payee or holder in due course, as the case may be, maintains the account, and within the jurisdiction of the court, where such cheque was presented for collection, will have jurisdiction to entertain complaint alleging commission of offence punishable under Section 138 of the NI Act.
(iii) In view of the above finding, the word ‘delivered’ used in Section 142(2)(a) of the NI Act has no significance and significance must be given to the text ‘for collection through an account’.
