Module: General Practice
Q178: Regarding the territorial jurisdiction for filing a complaint under Section 138 (Dishonour of Cheque), consider the following statements based on Section 142 and recent judgments:
If the cheque is delivered for collection through an account, the complaint must be filed where the branch of the bank where the payee maintains the account is situated.
If the cheque is presented otherwise than through an account (over the counter), the complaint must be filed where the branch of the drawer's bank is situated.
Which of the statements given above is/are correct?
If the cheque is presented otherwise than through an account (over the counter), the complaint must be filed where the branch of the drawer's bank is situated.
Which of the statements given above is/are correct?
✅ Correct Answer: C
The Jurisdiction rules were solidified by the 2015 Amendment to the NI Act, overturning previous confusion.
Case 1 (Collection via Account): If the payee deposits the cheque into their own account, the jurisdiction is defined by the location of the Payee's Bank Branch. (Reaffirmed in Jai Balaji Industries v. M/s HEG Ltd, Nov 2025). Case 2 (Over the Counter): If the payee goes to the drawer's bank to encash it across the counter, the jurisdiction is the location of the Drawer's Bank Branch.
Both statements accurately reflect the current statute.
Case 1 (Collection via Account): If the payee deposits the cheque into their own account, the jurisdiction is defined by the location of the Payee's Bank Branch. (Reaffirmed in Jai Balaji Industries v. M/s HEG Ltd, Nov 2025). Case 2 (Over the Counter): If the payee goes to the drawer's bank to encash it across the counter, the jurisdiction is the location of the Drawer's Bank Branch.
Both statements accurately reflect the current statute.