Negotiable Instruments Act: All India Annual Digest 2025

Supreme CourtDistinction between 'delivery' and 'presentation' illustrated - Supreme Court distinguished delivery (Section 46 NI Act) from presentment (Section 64 NI Act) - Held that delivery involves the drawer handing the cheque to the payee, and, in case of account-payee cheques, the payee delivering it to his own bank - This stage is covered by Section 142(2)(a) - Presentment is the act of presenting the cheque to the drawee bank for payment; this stage is relevant for Section 142(2)(b). [Relied on Bijoy Kumar Moni v. Paresh Manna 2024 SCC OnLine SC 3833; Paras 42-50] Jai Balaji Industries Ltd. v. Heg Ltd., 2025 LiveLaw (SC) 1149 : 2025 INSC 1362Promissory Note - Suit of Recovery of amount - Onus of Proof - Supreme Court set aside a High Court order that reduced the amount recoverable under a promissory note from Rs. 35,29,690 to Rs. 22,00,000 and restored the Trial Court's decree - High Court reduced the amount citing a lack of documentary proof for the cash portion of the loan – Held, once a promissory note is accepted, the onus is on the respondent to disprove the debt, not on the appellant to provide documentary evidence for cash payments - It is not uncommon for money transactions to include a cash component and that the absence of a receipt or bank transaction is not sufficient to negate the payment, especially when a promissory note exists - Initial presumption of legally enforceable debt comes from NI Act - High Court's view was erroneous and unsustainable - Appeal allowed. Georgekutty Chacko v. M.N. Saji, 2025 LiveLaw (SC) 878Section 138, 142(2) & 142A — Territorial Jurisdiction — Transfer of Pending Cases — Effect of Amendment Act, 2015 - Jurisdiction Post-2015 Amendment - Held that Supreme Court reiterates that the jurisdiction to try a complaint under Section 138 of the NI Act is vested in the court within whose local jurisdiction the bank where the payee or holder in due course maintains an account (and where the cheque is delivered for collection) is situated. [Para 76] Jai Balaji Industries Ltd. v. Heg Ltd., 2025 LiveLaw (SC) 1149 : 2025 INSC 1362Section 138, proviso to section 142 - Supreme Court quashed complaint, citing that there cannot be an 'automatic or presumed condonation' of a complaint filed beyond the statutory time limit - When a complaint is filed beyond the mandatory time limit, a proper application or affidavit must be filed by complainant disclosing the reasons for delay - Held that the High Court's opinion that a separate application for condonation of delay is not a 'statutory mandate' under Section 142(b) of the Act was also erroneous - Court is obligated to take note of a complaint being filed beyond the limitation period, consider the reasons disclosed for the delay, and come to a 'judicious conclusion' that condonation is justified before taking cognizance and issuing summons. [Paras 6-9] H.S. Oberoi Buildtech Pvt. Ltd. v. MSN Woodtech, 2025 LiveLaw (SC) 889Section 138 and 142 (2) - Petitioner sought the transfer of a criminal complaint filed under Section 138 of the N.I. Act by Kotak Mahindra Bank Ltd. from the Judicial Magistrate First Class, Chandigarh, to the Metropolitan Magistrate, Coimbatore, Tamil Nadu. The petitioner argued that the entire transaction, including the loan processing, EMI deductions, and SARFAESI proceedings, occurred in Coimbatore, and no cause of action arose in Chandigarh. The petitioner also cited inconvenience, language barriers, and harassment as grounds for transfer. The Supreme Court reiterated that under Section 142(2) of the N.I. Act, as amended in 2015, the jurisdiction for complaints under Section 138 lies with the court where the cheque is delivered for collection through the payee's bank account. The court in Chandigarh had jurisdiction as the cheque was presented for collection there, even if the transaction occurred in Coimbatore. The petitioner's grievances did not meet the threshold for transfer, as the Chandigarh court had valid jurisdiction under Section 142(2) of the N.I. Act. The Supreme Court dismissed the transfer petition, holding that no case was made out for transferring the proceedings from Chandigarh to Coimbatore. It is always open for the petitioner accused to pray for 2 exemption from personal appearance or request the Court that he may be permitted to join the proceedings online. (Para 65) Shri Sendhuragro and Oil Industries v. Kotak Mahindra Bank, 2025 LiveLaw (SC) 292 : 2025 INSC 328Section 138 and 142 (2) - Petitioner sought the transfer of a criminal complaint filed under Section 138 of the N.I. Act by Kotak Mahindra Bank Ltd. from the Judicial Magistrate First Class, Chandigarh, to the Metropolitan Magistrate, Coimbatore, Tamil Nadu. The petitioner argued that the entire transaction, including the loan processing, EMI deductions, and SARFAESI proceedings, occurred in Coimbatore, and no cause of action arose in Chandigarh. The petitioner also cited inconvenience, language barriers, and harassment as...

Negotiable Instruments Act: All India Annual Digest 2025

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