Complainant Does Not Acquiesce To Jurisdiction Under NI Act By Merely Participating In Proceedings Or Negotiating A Settlement: J&K High Court

The Jammu and Kashmir High Court has held that merely because the complainant participated in the proceedings by giving evidence on affidavit before the trial magistrate not having the jurisdiction to try the case does not mean he has acquiesced to the jurisdiction of the court.The respondent had argued that after already participating in the proceedings, it was not open to the petitioner to challenge the jurisdiction at this stage and also placed certain judgments on record in support of the arguments.A bench of Justice Sanjay Dhar held that it cannot be stated that the petitioner has, by his conduct, acquiesced to the jurisdiction of the magistrate considering the fact that proceedings were still at initial stage and only the evidence by affidavit by the complainant has been filed and no cross-examination had been conducted yet. The court said that even otherwise, the trial magistrate lacked the inherent jurisdiction to try the case, and where there is no such jurisdiction, the court cannot assume it by the consent of the parties.The court observed that the judgments relied on by the respondent were not dealing specifically with the Negotiable Instruments Act, and even otherwise, in these precedents, the jurisdiction of the authorities was challenged after the authorities had already decided the matter against the party challenging the jurisdiction.The court said that when a cheque is delivered to a person to present the same for collection at any branch of the bank, then the cheque shall be deemed to have been delivered to the branch of the bank in which the payee maintains the account. The court was dealing with the interpretation of the word “delivered” as incorporated under section 142 (2) (a) of the N.I. Act for the purpose of determining the jurisdiction of the court wherein the cases under the NI Act can be triedThe court observed that the word “delivered‟ used in provisions of the N.I. Act has no significance, and what is of significance is the expression “for collection through an account”. It meant that, delivery of the cheque takes place where the cheque was issued and presentation of the cheque will be through the account of the payee or holder in due course, and the said place is decisive to determine the question of jurisdiction."The court said that it was clear that the cases falling under section 138 of the NI Act could be tried with a local court of competent jurisdiction where the cheque was delivered for collection and not where the cheque was simply delivered. The court said that the court of the place where the account was maintained was a competent court to try the cases arising from the Negotiable Instrument Act.BACKGROUNDThe petitioner has filed the present petition to challenge a criminal complaint filed against him and his firm, M/s ANN Infrastructure. The complaint alleges offences under Section 138 of the Negotiable Instruments Act and Section 420 of the RPC (cheating). The petitioner has also questioned the order dated 24.07.2021 passed by the Judicial Magistrate 1st Class, Jammu, where the Magistrate took cognizance of the complaint and issued process (summons) against him.The complaint claims that the petitioner issued a cheque of Rs. 60 lakhs from his Axis Bank account to settle dues owed to the respondent. However, when the respondent presented the cheque through ICICI Bank, it was returned unpaid on 30.09.2020 with the remark "title of account required."The petitioner challenged the jurisdiction of the court taking cognizance saying that the cheque was presented by the respondent to the payee bank maintained with ICICI Bank Limited, Branch Sector 128 Noida, Utter Pradesh and as such, theTrial Magistrate had no territorial jurisdiction.APPEARANCE:Vishal Kapoor, Advocate For PetitionerSunil Sethi, Sr. Adv. with Mr. Navyug Sethi. For RespondentsCase-Title: Aditya Malhotra vs Dharminder Singh Citation: 2025 LiveLaw (JKL) 138Click Here To Read/Download Order

Complainant Does Not Acquiesce To Jurisdiction Under NI Act By Merely Participating In Proceedings Or Negotiating A Settlement: J&K High Court

Aleem Syeed

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