Legal Reference Library

Gujarat High Court has recently held that the contention that when a signed blank cheque leaf  is handed over, it can never be filled up and that if it is filled up it would  amount to a material alteration within the meaning of using Section 87 of the   N.I.  Act, does not stand to rhyme or reason. The Court said that it would depend upon the facts of each case. Justice J.B.Pardiwala has allowed a batch of Petitions seeking quashment of Criminal Proceedings under Section 138 of NI Act. He has framed the following questions relating to blank cheques (i) Whether Section 20 of the Negotiable Instruments Act applies to a cheque as well? (ii) Whether filling up of a signed blank cheque leaf would amount to a material alteration within the meaning of Section 87 of the N.I. Act? (iii) Is there an implied authority to a person who receives a signed blank cheque leaf to fill up the same showing any amount  as he likes? Answering the questions, the Court held as follows;...

A Two Judge Bench of the Supreme Court comprising of Justices J.S.Khehar and R.Banumati has held that, in view of the Amended Section 142(2) of Negotiable Instruments (Amendment) Second Ordinance 2015, the place where a cheque is delivered for collection i.e., the branch of the bank of the payee or holder in due course, where the drawee maintains an account, would be the determinative of the place of territorial jurisdiction for filing Complaint under the NI Act. The Bench was hearing an Appeal from an order dated 5.5. 2011 of Madhya Pradesh High Court in which it is held that the Jurisdiction to file a Complaint under NI Act lay only before the Court where-in the original drawee bank was located. The High Court relied on the Three Judge Bench Judgment of the Supreme Court in Dashrath Rupsingh Rathod vs. State of Maharashtra. Criminal Appeal No. 1557 of 2015 (Arising out of SLP (Crl.) No. 7850 of 2011), Criminal Appeal No. 1562 of 2015 (Arising out of SLP (Crl.) No. 9758 of 2011), Cr...