Source: Supreme Court

Why in News?

The Supreme Court (SC) reinforced the fundamental procedural character of the Code of Criminal Procedure,1973 (CrPC) and emphasized that minor technical flaws and irregularities should never obstruct the quest for substantial justice in the matter of Bijoy Shankar Mishra v. State of Jharkhand.

Background

• In 2016, the appellant (Bijoy Shankar Mishra) filed a criminal complaint under Section 138 of the Negotiable Instruments Act, 1881(NI Act) with regard to dishonored cheques in the court of Chief Judicial Magistrate at Jamshedpur, Jharkhand.
• The court of the Judicial Magistrate First Class (JMFC), took cognizance, and issued summons to the accused.
• JMFC on examining the records, concluded that the court did not have territorial jurisdiction (procedural lapse) in terms of Section 142(2)(a) of NI Act.
• The appellant took remedial recourse by moving an application under Section 407 of CrPC before the High Court (HC).
• An order was passed that the cheques in question were presented in the account of the appellant at Adityapur, district Saraikela-Kharsawan, therefore, only the courts at Saraikela-Kharsawan possessed territorial jurisdiction.
• Thereafter, appellant preferred a petition under Section 482 of CrPC before the HC which was dismissed and the order of JMFC was sustained.
• No opportunity was afforded to the appellant to address this jurisdictional issue before the HC.
• Hence the appellant appealed to the SC.

Court’s Observations

• The SC observed that this is a fit case to exercise our power under Article 142 of the Constitution of India, 1950 (COI) read with Section 406 of CrPC.
• Reliance was placed on the case of Yogesh Upadhyay and Another v. Atlanta Limited (2023) whereby it was reaffirmed that CrPC primarily serves procedural purposes, and it must not impede the quest for justice; Section 406 of CrPC must come to rescue whenever there is miscarriage of justice.
• Further the Court observed that JMFC passed the order without realizing its legal consequences, that there was a lack of proper legal guidance to the appellant.
• Bench of Justices Sanjiv Khanna and Justice S.V.N Bhatti set aside earlier orders, directed that the continuation of trial in the criminal complaint case in the court of the JMFC, at Jamshedpur, Jharkhand while stating that such procedural defect/lapse had a remedy, and was not substantial as to constitute lack of subject-matter jurisdiction.

Legal Provisions

Constitution of India,1950

Article 142 - It grants special powers to the Supreme Court of India to deliver justice and enforce its judgments in cases where there may be a need to do so in the interest of justice, even if there is no specific legal provision that directly addresses the situation.

Code of Criminal Procedure, 1973

Section 406 - Power of Supreme Court to transfer cases and appeals —

(1) Whenever it is made to appear to the Supreme Court that an order under this section is expedient for the ends of justice, it may direct that any particular case or appeal be transferred from one High Court to another High Court or from a Criminal Court subordinate to one High Court to another Criminal Court of equal or superior jurisdiction subordinate to another High Court.

(2) The Supreme Court may act under this section only on the application of the Attorney-General of India or of a party interested, and every such application shall be made by motion, which shall, except when the applicant is the Attorney-General of India or the Advocate-General of the State, be supported by affidavit or affirmation.

(3) Where any application for the exercise of the powers conferred by this section is dismissed, the Supreme Court may, if it is of opinion that the application was frivolous or vexatious, order the applicant to pay by way of compensation to any person who has opposed the application such sum not exceeding one thousand rupees as it may consider appropriate in the circumstances of the case.

• The provision must be exercised sparingly and only when justice is apparently in grave peril.
• The primary grounds for such transfers typically include:
  • Fair and Impartial Trial: When the court believes that a fair and impartial trial cannot be conducted in the original jurisdiction due to various factors like local bias, threat to witnesses, or any other reason that may compromise the fairness of the trial.
  • Interest of Justice: In the interest of justice, if the SC deems it necessary to transfer a case to ensure that justice is served.
  • Avoidance of Multiplicity of Proceedings: When multiple cases involving the same issues or parties are pending in different courts, the SC can transfer them to one court to avoid contradictory judgments and to streamline the legal process.
  • Convenience: If the convenience of the parties, including witnesses and litigants, would be better served by transferring the case to another jurisdiction then a decision of transfer must be made.

Negotiable Instruments Act, 1881

• Dishonour of cheque is provided under Section 138 and Section 142 mentions about Cognizance of offences.
• It can be summarized as follows:
  • Only a court not inferior to JMFC or Metropolitan Magistrate can take cognizance of an offence related to the dishonor of cheques under Section 138 and that too upon a written complaint made by the payee or holder in due course of the dishonored cheque.
  • The complaint must be filed within one month of the date on which the cause of action arises under Section 138(c). However, the court may consider the complaint even if it is filed after the prescribed period if the complainant can establish sufficient cause for the delay.
  • Section 142(2) provides that:
    • The offence under section 138 shall be inquired into and tried only by a court within whose local jurisdiction, —
    • (a) if 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; or
    • (b) if the cheque is presented for payment by the payee or holder in due course, otherwise through an account, the branch of the drawee bank where the drawer maintains the account is situated.

Case Law

Laxmi Dyechem v. State of Gujarat (2012): The SC in the present case held that Sections 138 to 142 of the NI Act are designed to penalize individuals who are aware of the fact that they lack sufficient funds in their bank account but still issue a cheque to settle an existing debt or obligation, constituting an act of deception. These provisions are not intended to penalize individuals who have a legitimate reason for not honoring their debt obligations.