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Aug 08
6
Recent Amendment to Negotiable Instruments Act, 1881
Posted by:MyEfilings
Recent Amendment to Negotiable Instruments Act, 1881

On 6th August, 2015, Lok Sabha has passed Negotiable Instruments (Amendment) Bill, 2015 by voice note. The Bill seeks to amend Negotiable Instruments Act, 1881. The Negotiable Instruments Act, 1881 defines bills of exchange, promissory notes, cheques and creates penalties for issues such a bouncing cheques.

Highlights of Negotiable Instruments (Amendment) Bill, 2015

Jurisdiction

Present Negotiable Instruments Act, 1881 does not specify the territorial jurisdiction of the Court where complaint of cheque bouncing can be filed. The present act specifies the circumstances under which complaint for cheque bouncing can be filed. The Bill seeks to amend the Act to state that cases of bouncing of cheques can be filed only in the court in whose jurisdiction bank branch of the payee (person who receives cheque) lies.

Jurisdiction for subsequent complaints

If a complaint for cheque bouncing has been filed against a person issuing the cheque in a court with the appropriate jurisdiction, all the subsequent complaints against that person should be filed in the same court, irrespective of relevent jurisdiction.

Jurisdiction for cases already filed

If different cases have been filed within the jurisdictions of different courts, the cases will be transferred to the court with appropriate jurisdiction.

Definitions

The Bill also seeks to amend definition of 'cheque in electronic form'. Under the Negotiable Instruments Act, 1881 'cheque in electronic form' is defined as a cheque containing exact mirror image of a paper cheque and generated in a secure system using digital signature. The Bill seeks to amend this definition and 'cheque in electronic form' is defined as cheque drawn in electronic medium using any computer resource and which is signed in a secure system with a digital signature, or electronic system.



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