Transfer Petition Seeks Consolidation of Multiple Cheque Bounce Cases Across States

New Delhi, 2017 — A transfer petition under Section 406 of the Criminal Procedure Code (CrPC) has been filed before the Hon’ble Supreme Court of India seeking consolidation and transfer of several pending criminal cases under Section 138 of the Negotiable Instruments Act, 1881.

The petitioners have requested that all related cases, currently spread across different states including Maharashtra, Delhi, and Bihar, be transferred to a single jurisdiction — preferably Mumbai or Navi Mumbai — to avoid undue harassment and logistical challenges.

Background of the Dispute

The dispute arises from a Memorandum of Understanding (MoU) entered in May 2004 concerning the sale of a parcel of land in Navi Mumbai.

According to the petitioners, the MoU was subject to the outcome of a pending civil suit involving third parties and land acquisition by a government authority.

Under the MoU, the purchasers made part payment towards the land. However, as the original civil dispute remained unresolved, the purchasers later sought a refund of the money.

An oral agreement was allegedly reached whereby part of the money would be refunded, and the balance would be treated as an interest-free loan repayable over 18 months.

To facilitate this settlement, the petitioners issued post-dated cheques totaling ₹37.49 lakhs.

The cheques were allegedly provided subject to execution of a formal deed of cancellation of the MoU, which the respondents failed to execute.

In anticipation of a possible breach, the petitioners claim to have sent advance written communication requesting non-encashment of the cheques and issued ‘stop payment’ instructions to their bank.

Despite this, the cheques were reportedly deposited by the respondents at different locations — including Delhi, Patna, and Nashik — leading to multiple criminal complaints being filed against the petitioners under the Negotiable Instruments Act.

Grounds for Transfer

The petitioners argue that all transactions, including signing of the MoU, payment of funds, and issuance of cheques, occurred in Navi Mumbai, where both parties were based at the time. Hence, they argue, the cause of action and jurisdiction lies exclusively within that region.

Some of the key grounds cited include:

• The MoU and all related communications originated in Mumbai/Navi Mumbai.

• The property in question is located in Navi Mumbai, and the litigation relating to ownership is already ongoing there.

• Issuance and delivery of cheques also took place in Navi Mumbai, indicating that any legal liability connected to the cheques should be decided by the courts there.

• The cheques were not dishonoured due to insufficient funds, but because of a ‘stop payment’ request tied to non-fulfilment of agreed conditions.

• Filing cases in multiple jurisdictions, the petitioners allege, is a tactic to harass and pressure them into a settlement.

Legal Position and Relief Sought

Referring to various judicial precedents, the petitioners contend that Section 138 of the N.I. Act requires strict compliance with jurisdictional principles — namely, that the court where the cheque is drawn or the bank is situated holds primary jurisdiction, not merely where a cheque is presented.

The petition seeks transfer of all pending complaints to one jurisdiction to prevent multiplicity of proceedings, reduce hardship for the accused, and avoid abuse of process of law.

Additionally, the petitioners emphasize their willingness to participate in legal proceedings and assert that they do not seek to avoid trial, but only to consolidate the cases in one appropriate venue to ensure fair adjudication.

Conclusion

The case raises important questions around forum shopping, jurisdictional abuse, and procedural fairness in cheque bounce cases under Section 138 N.I. Act.

The Supreme Court’s decision on this transfer petition is expected to have broader implications for similar disputes where civil and criminal liabilities are closely linked and spread across multiple legal forums.