M/S SHRI SENDHUR AGRO & OIL INDUSTRIES VS KOTAK MAHINDRA BANK LTD.
The case is between Shri Sendhur Agro & Oil Industries and Kotak Mahindra Bank Ltd, embodying a critical question of Law, i.e., when the whole transaction is outside the jurisdiction of the Court wherein the case has been filed under Section 138 of NI Act. Can the Complaint be filed at the Place Of the Payee Bank? Whether the Accused can seek transfer of the said Complainant to the Place where the whole transaction is taken place. Further whether the 2015 amendment to Section 142A of the NI Act violates Articles 14 & 21 of the constitution as it won’t provide equal access to justice to the drawer of the cheque (accused) to defend himself without any hardship, which is against his right to get a fair trial.
The fact of the case was that the transaction between the Complainant and the Accused wholly happened in Coimbatore and not in Chandigarh. However, the cheque was presented in the branch of the bank where the payee maintains an account, i.e., in Chandigarh. Hence, the Accused filed the transfer Application stating that the Courts in Coimbatore alone will have the jurisdiction to entertain the present criminal complaint.
The Supreme Court of India held that A conjoint reading of Section 142(2)(a) along with the explanation 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, as the case may be, maintains the account 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 the court of the place where such cheque was presented for collection, will have the jurisdiction to entertain the complaint alleging the commission of offence punishable under Section 138 of the N.I. Act.
The significance of this case lies in delineating jurisdictional clarity while upholding constitutional mandates of fairness and justice under Articles 14 and 21 of the Constitution, as stated by the Accused. The ruling provides legal certainty on where complaints under Section 138 of the NI Act can be filed, at the Place Of the Payee Bank when the Whole Transaction has taken place outside the jurisdiction of the Court. The Judgement ensured that the 2015 amendment to Section 142A does not infringe upon the right to a fair trial, which is essential to maintaining judicial integrity.
JUDGEMENT LINK – https://api.sci.gov.in/supremecourt/2024/28709/28709_2024_13_1503_59957_Judgement_06-Mar-2025.pdf