Negotiable Instruments Act, 1881. Decision in this regard was Union
Cabinet meet chaired by Prime Minister Narendra Modi in New Delhi.
The ordinance paves way for filing of cheque bounce cases in place
where the cheque was issued. This move that will benefit around 18
lakh people involved in such cheque bounce cases.
In May 2015, The Negotiable Instruments (Amendment) Bill, 2015 was
passed in Lok Sabha. However the bill was not able pass in Rajya Sabha
where ruling NDA government is in minority.
Background
**In 2014, Supreme Court had ruled that cases against those having
defaulted on their cheque payments only need be filed in courts under
which jurisdiction of the bank account of the accused fell.
**However, this ruling was not payee-friendly. So in order to protect
of payee Union government brought amendment bill to by-pass the
court's order.
About Negotiable Instruments (Amendment) Bill, 2015
**The amendment bill adds provision to specify the territorial
jurisdiction of the courts in cases related to bouncing of cheques
which was not present in the parent Act.
**It says that cases in this regard need to be filed only in a court
in whose jurisdiction the bank branch of the payee lies.
**It also adds provision related to more than one case is filed
against the same person before different courts for bouncing of
cheques.
**In this matter, the case will be transferred to the court that has
appropriate jurisdiction. The bill also amends the definition of
cheque.
**Now it defines it as cheque in the electronic form which is signed
in a secure system with a digital signature or using electronic system
and drawn in electronic medium using any computer resource.
About Negotiable Instruments Act, 1881
The Act defines bills of exchange, promissory notes, cheques and
creates penalties for issues such as bouncing of cheques. It also
specifies circumstances under which complaints for cheque bouncing can
be filed.
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