{"id":285816,"date":"2023-03-01T17:00:35","date_gmt":"2023-03-01T11:30:35","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=285816"},"modified":"2023-03-01T16:50:19","modified_gmt":"2023-03-01T11:20:19","slug":"notwithstanding-the-non-obstante-clause-in-s-1421-of-ni-act-the-power-of-sc-to-transfer-criminal-cases-under-s-406-crpc-remains-intact-in-relation-to-offences-under-s","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2023\/03\/01\/notwithstanding-the-non-obstante-clause-in-s-1421-of-ni-act-the-power-of-sc-to-transfer-criminal-cases-under-s-406-crpc-remains-intact-in-relation-to-offences-under-s\/","title":{"rendered":"Explained| Supreme Court&#8217;s power under Section 406 CrPC to transfer Section 138 NI Act cases and effect of non-obstante clause under Section 142(1) NI Act"},"content":{"rendered":"<p><script type=\"text\/javascript\">\n\u00a0\u00a0\u00a0 document.title = 'Supreme Court has power to transfer Section 138 NI Act cases| SCC Blog'\n\u00a0\u00a0\u00a0 document.querySelector('meta[name=\"description\"]').setAttribute(\"content\", \"Supreme Court explains its power under Section 406 CrPC to transfer Section 138 NI Act cases and effect of non-obstante clause under Section 142(1) NI Act\");\n<\/script><\/p>\n<div style=\"text-align: justify; line-height: 150%;\">\n<p style=\"margin-bottom: 3%;\"><b>Supreme Court:<\/b> In transfer petitions filed under Section <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0001519697\">406<\/a> of <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0002726935\">Code of Criminal procedure 1973<\/a> (&#8216;CrPC&#8217;) by the petitioner seeking transfer of two complaint cases filed against him for offences under Sections <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0001544366\">138<\/a> and <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0001544371\">142<\/a> of the <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0002726957\">Negotiable Instruments Act, 1881<\/a> (&#8216;NI Act&#8217;) from Civil Judge, Senior Division, Nagpur to the South West District Courts, Dwarka, New Delhi, to be tried along with other four complaint cases Dinesh Maheshwari and Sanjay Kumar, JJ. while allowing the transfer petitions, held that notwithstanding the non obstante clause in Section <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0001544371\">142(1)<\/a> of the <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0002726957\">NI Act<\/a>, the power of this Court to transfer criminal cases under Section <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0001519697\">406<\/a> <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0002726935\">CrPC<\/a>. remains intact in relation to offences under Section <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0001544366\">138<\/a> of the <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0002726957\">NI Act of 1881<\/a>, if it is found expedient for the ends of justice.<\/p>\n<p style=\"margin-bottom: 3%;\">The Court said that it is well settled that the offence under Section <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0001544366\">138<\/a> of <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0002726957\">NI Act<\/a> is complete upon dishonour of the cheque, but prosecution in relation to such offence is postponed till the failure of the drawer of the cheque to make the payment within 15 days of receiving the demand notice. However, jurisdiction to try this offence remained a troublesome issue for a long time.<\/p>\n<p style=\"\">The Court took note of <i>K. Bhaskaran<\/i> v. <i>Sankaran Vaidhyan Balan<\/i>, <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0000027727\">(1999) 7 SCC 510<\/a>, wherein it was held that an offence under Section <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0001544366\">138<\/a> of the <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0002726957\">NI Act<\/a> has five components:<\/p>\n<p style=\"margin-left: 36pt; text-indent: -18pt;\">(1) drawing of the cheque,<\/p>\n<p style=\"margin-left: 36pt; text-indent: -18pt;\">(2) presentation of the cheque to the bank,<\/p>\n<p style=\"margin-left: 36pt; text-indent: -18pt;\">(3) returning of the cheque unpaid by the drawee bank,<\/p>\n<p style=\"margin-left: 36pt; text-indent: -18pt;\">(4) giving notice in writing to the drawer of the cheque demanding payment of the cheque amount, and<\/p>\n<p style=\"margin-left: 36pt; text-indent: -18pt; margin-bottom: 3%;\">(5) failure of the drawer to make payment within 15 days of the receipt of the notice.<\/p>\n<p style=\"margin-bottom: 3%;\">It was further held that the Courts having jurisdiction over the territorial limits wherein any of the five acts, that constitute the components of the offence, occurred would have the jurisdiction to deal with the case and if the five acts were done in five different areas, any one of the Courts exercising jurisdiction in those five areas would have jurisdiction and the complainant could choose any one of those Courts.<\/p>\n<p style=\"margin-bottom: 3%;\">Further, it relied on <i>Dashrath Rupsingh Rathod<\/i> v. <i>State of Maharashtra<\/i>, <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0000050331\">(2014) 9 SCC 129<\/a>, wherein it was held that the place, situs or venue of judicial inquiry and trial of the offence must logically be restricted to where the drawee bank is located, i.e., where the cheque is dishonoured upon presentation and not where the complainant&#8217;s bank is situated.<\/p>\n<p style=\"margin-bottom: 3%;\">The Court took note of Section <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0001544371\">142<\/a> of <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0002726957\">NI Act<\/a> (notwithstanding anything contained in <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0002726935\">CrPC, 1973<\/a>, no Court shall take cognizance of an offence punishable under Section <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0001544366\">138<\/a> <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0002726957\">NI Act<\/a> except on a complaint in writing made by the payee or, as the case may be, the holder in due course of the cheque&#8230;) and the <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0003003824\">Negotiable Instruments (Amendment) Act, 2015<\/a> , and said that the newly inserted Section 142(2) states that the offence under Section 138 shall be inquired into and tried only by a Court within whose local jurisdiction the cheque is delivered for collection through an account, the branch of the bank where the payee or holder in due course, as the case may be, maintains the account, is situated.<\/p>\n<p style=\"margin-bottom: 3%;\">The Court after examining the statement of objects and reasons in <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0003003824\">NI Amendment Act, 2015<\/a>, it said that the insertion of Sections <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0001544371\">142(2)<\/a> and <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0001544372\">142-A<\/a> in the <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0002726957\">NI Act<\/a> was a direct consequence of the judgment in Dashrath Rupsingh Rathod (supra). Thus, the territorial jurisdiction to try an offence under Section 138 is vested in the Court having jurisdiction over the drawee bank and not the complainant&#8217;s bank where he had presented the cheque. Section 142(2) now makes it clear that the jurisdiction to try such an offence would vest only in the Court within whose jurisdiction the branch of the Bank where the cheque was delivered for collection, through the account of the payee or holder in due course, is situated. The newly inserted Section 142-A further clarifies this position by validating the transfer of pending cases to the Courts conferred with such jurisdiction after the amendment.<\/p>\n<p style=\"margin-bottom: 3%;\">The Court further noted that <i>Bridgestone India Private Limited<\/i> v. <i>Inderpal Singh<\/i>, <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0000051616\">(2016) 2 SCC 75<\/a> affirmed the legal position obtained after the amendment of the <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0002726957\">NI Act<\/a> and endorsed that Section 142(2)(a) vests jurisdiction for initiating proceedings for an offence under Section 138 in the Court where the cheque is delivered for collection, i.e., through an account in the branch of the bank where the payee or holder in due course maintains an account.<\/p>\n<p style=\"margin-bottom: 3%;\">Therefore, the Court said that the institution of the first two complaint cases before the Courts at Nagpur is in keeping with the legal position obtaining now. However, it rejected the contention that the non obstante clause in Section <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0001544371\">142(1)<\/a> of the <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0002726957\">NI Act<\/a> would override Section <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0001519697\">406<\/a> <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0002726935\">CrPC<\/a> and that it would not be permissible for this Court to transfer the said complaint cases.<\/p>\n<p style=\"margin-bottom: 3%;\">The Court noted that the non obstante clause was there in the original Section 142 itself and was not introduced by way of the amendments in the year 2015, along with Section 142(2). The said clause merely has reference to the manner in which cognizance is to be taken in offences under Section 138. Further, the power of Supreme Court to transfer pending criminal proceedings under Section <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0001519697\">406<\/a> <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0002726935\">CrPC<\/a> does not stand abrogated thereby in respect of offences under Section <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0001544366\">138<\/a> of the <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0002726957\">Act of 1881<\/a>.<\/p>\n<p style=\"margin-bottom: 3%;\">After placing reliance on <i>A.E. Premanand<\/i> v. <i>Escorts Finance Ltd.<\/i>, <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0000034173\">(2004) 13 SCC 527<\/a>, the Court held that notwithstanding the non obstante clause in Section <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0001544371\">142(1)<\/a> of the <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0002726957\">NI Act<\/a>, the power of this Court to transfer criminal cases under Section <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0001519697\">406<\/a> <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0002726935\">CrPC<\/a>. remains intact in relation to offences under Section <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0001544366\">138<\/a> of the <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-0002726957\">NI Act of 1881<\/a>, if it is found expedient for the ends of justice.<\/p>\n<p style=\"margin-bottom: 3%;\">Further, it said that, as the six complaint cases pertain to the same transaction, it would be advisable to have a common adjudication to obviate the possibility of contradictory findings being rendered in connection therewith by different Courts.<\/p>\n<p style=\"margin-bottom: 3%;\">[<span style=\"font-weight: bold; color: #632423;\">Yogesh Upadhyay v. Atlanta Limited, <a href=\"http:\/\/www.scconline.com\/DocumentLink\/k4lqC7Xh\">2023 SCC OnLine SC 170<\/a>, decided on 21-02-2023<\/span>]<\/p>\n<p style=\"text-indent: 18pt;\"><strong><span style=\"color: #000080;\">Judgment by: Justice Sanjay Kumar<\/span><\/strong><\/p>\n<blockquote class=\"wp-embedded-content\" data-secret=\"gEzJNI5HTI\"><p><a href=\"https:\/\/www.scconline.com\/blog\/post\/2023\/02\/05\/supreme-court-judges-president-assent-legal-updates-knowledge-news-collegium\/\">Know Thy Judge| 5 Judges who have received President\u2019s nod for appointment as Supreme Court Judges<\/a><\/p><\/blockquote>\n<p><iframe loading=\"lazy\" class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; clip: rect(1px, 1px, 1px, 1px);\" title=\"&#8220;Know Thy Judge| 5 Judges who have received President\u2019s nod for appointment as Supreme Court Judges&#8221; &#8212; SCC Blog\" src=\"https:\/\/www.scconline.com\/blog\/post\/2023\/02\/05\/supreme-court-judges-president-assent-legal-updates-knowledge-news-collegium\/embed\/#?secret=xRk3UNoA5a#?secret=gEzJNI5HTI\" data-secret=\"gEzJNI5HTI\" width=\"600\" height=\"338\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p><i>Supreme Court said that as four of the six cases have been filed by the respondent company before the Dwarka Courts at New Delhi and only two such cases are pending before the Courts at Nagpur, it would be convenient and in the interest of all concerned, that the cases be transferred to the Dwarka Courts at New Delhi.<\/i><\/p>\n","protected":false},"author":67512,"featured_media":285825,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3,9],"tags":[2862,2554,23564,44635,5363,23654],"class_list":["post-285816","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-casebriefs","category-supremecourt","tag-dishonour_of_cheque","tag-Jurisdiction","tag-negotiable-instruments","tag-sc","tag-supreme-court","tag-transfer-petition"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.4 (Yoast SEO v26.4) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Explained| Supreme Court&#039;s power under Section 406 CrPC to transfer Section 138 NI Act cases and effect of non-obstante clause under Section 142(1) NI Act | SCC Times<\/title>\n<meta name=\"description\" content=\"In transfer petitions 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SC answers","author":"Editor","date":"March 8, 2025","format":false,"excerpt":"For the purpose of transfer of any case or proceedings under Section 406 of the CrPC, the case must fall within the ambit of the expression \u201cexpedient for the ends of justice\u201d.","rel":"","context":"In &quot;Case Briefs&quot;","block_context":{"text":"Case Briefs","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/"},"img":{"alt_text":"S. 138 NI Act case transfer","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2025\/03\/S.-138-NI-Act-case-transfer.webp?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2025\/03\/S.-138-NI-Act-case-transfer.webp?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2025\/03\/S.-138-NI-Act-case-transfer.webp?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2025\/03\/S.-138-NI-Act-case-transfer.webp?resize=700%2C400&ssl=1 2x"},"classes":[]},{"id":223585,"url":"https:\/\/www.scconline.com\/blog\/post\/2019\/12\/25\/madras-hc-s-1422-of-negotiable-instruments-amendment-act-2015-not-ultra-vires-of-art-14-of-constitution-legislation-can-take-away-the-basis-of-a-judgment\/","url_meta":{"origin":285816,"position":1},"title":"Madras HC | S. 142(2) of Negotiable Instruments Amendment Act, 2015 &#8212; not ultra vires of Art. 14 of Constitution; Legislation can take away the basis of a Judgment","author":"Bhumika Indulia","date":"December 25, 2019","format":false,"excerpt":"Madras High Court: A Division Bench of A.P. Sahi, CJ and Subramonium Prasad, J., while deciding a petition filed in regard to declaring Section 142(2) of the Negotiable Instruments Act, 1881 as ultra vires Article 14 of Constitution, held by placing reliance on certain cases that, \u201cParliament is competent to\u2026","rel":"","context":"In &quot;Case Briefs&quot;","block_context":{"text":"Case Briefs","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":253137,"url":"https:\/\/www.scconline.com\/blog\/post\/2021\/08\/23\/dishonour-of-cheques\/","url_meta":{"origin":285816,"position":2},"title":"All HC | For offence of dishonour of cheques, what needs to be given priority \u2013 Compensatory aspect or Punitive aspect?","author":"Bhumika Indulia","date":"August 23, 2021","format":false,"excerpt":"Allahabad High Court: Chandra Dhari Singh, J., expressed that, Merely because the litigation has reached a revisional stage or that even beyond that stage, the nature and character of the offence would not change automatically and it would be wrong to hold that a revisional stage, the nature of offence\u2026","rel":"","context":"In &quot;Case Briefs&quot;","block_context":{"text":"Case Briefs","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/10\/All-HC-Lko-Bench_4.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/10\/All-HC-Lko-Bench_4.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/10\/All-HC-Lko-Bench_4.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/10\/All-HC-Lko-Bench_4.jpg?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/10\/All-HC-Lko-Bench_4.jpg?resize=1050%2C600&ssl=1 3x"},"classes":[]},{"id":370991,"url":"https:\/\/www.scconline.com\/blog\/post\/2025\/12\/26\/hc-roving-enquiry-debt-liability-quashing-section-138-ni-act-complaint-supreme-court-section-482-crpc\/","url_meta":{"origin":285816,"position":3},"title":"High Court Cannot Conduct Roving Enquiry into Debt or Liability While Quashing Section 138 NI Act Complaint: Supreme Court","author":"Prachi Bhardwaj","date":"December 26, 2025","format":false,"excerpt":"\u201cUnder Section 139 of the NI Act, there is a presumption that the holder of a cheque received the cheque of the nature referred to in Section 138 NI Act for the discharge, in whole or in part, of any debt or other liability. This presumption can be rebutted by\u2026","rel":"","context":"In &quot;Case Briefs&quot;","block_context":{"text":"Case Briefs","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/"},"img":{"alt_text":"Enquiry into Debt or Liability","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2025\/12\/Enquiry-into-Debt-or-Liability.webp?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2025\/12\/Enquiry-into-Debt-or-Liability.webp?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2025\/12\/Enquiry-into-Debt-or-Liability.webp?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2025\/12\/Enquiry-into-Debt-or-Liability.webp?resize=700%2C400&ssl=1 2x"},"classes":[]},{"id":250848,"url":"https:\/\/www.scconline.com\/blog\/post\/2021\/07\/06\/converting-a-complaint-under-s-138-ni-act-from-summary-trial-to-summons-trial-in-exercise-of-power-under-s-143-ni-act-sufficient-and-cogent-reasons-to-be-recorded-chh-hc-issues-practice-direction\/","url_meta":{"origin":285816,"position":4},"title":"Converting a complaint under S. 138 NI Act from summary trial to summons trial in exercise of power under S. 143 NI Act; Sufficient and cogent reasons to be recorded | Chh HC issues Practice Directions","author":"Editor","date":"July 6, 2021","format":false,"excerpt":"Chhattisgarh High Court relied on Supreme Court judgment In re: Expeditious Trial of Cases under Section 138 of Negotiable Instrument Act 1881, dated 16-04-2021, following directions are issued in compliance of the order. These are: The Magistrates having jurisdiction to try offences under the Negotiable Instruments At, 1881 shall record\u2026","rel":"","context":"In &quot;Hot Off The Press&quot;","block_context":{"text":"Hot Off The Press","link":"https:\/\/www.scconline.com\/blog\/post\/category\/news\/hot_off_the_press\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":221639,"url":"https:\/\/www.scconline.com\/blog\/post\/2019\/11\/01\/del-limitation-provided-under-s-468-crpc-not-applicable-to-s-138-ni-act\/","url_meta":{"origin":285816,"position":5},"title":"Del HC | Limitation provided under S. 468 CrPC not applicable to S. 138 NI Act","author":"Bhumika Indulia","date":"November 1, 2019","format":false,"excerpt":"Delhi High Court:\u00a0Suresh Kumar Kait, J., dismissed a criminal petition wherein the petitioner sought quashing of the summoning order passed by the Metropolitan Magistrate and also the criminal complaint under Section 138 read with 142 of the Negotiable Instruments Act, 1881. 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