Magistrate Cannot Summon Accused U/S 138 NI Act Residing Outside Jurisdiction Without Prior Inquiry Under Section 202 CrPC: Uttarakhand HC Quashes Cheque Bounce Summons

"This Requirement Is Not An Empty Formality; Rather, It Is A Substantive Safeguard Intended To Protect Persons Residing Beyond The Territorial Jurisdiction Of The Court From Being Summoned In A Mechanical Manner", High Court of Uttarakhand holding that a Magistrate is statutorily bound to conduct a prior inquiry or direct investigation under Section 202 of the Code of Criminal Procedure before issuing process against an accused who resides outside the territorial jurisdiction of the court.

Justice Ashish Naithani quashed the summoning order in a cheque dishonour case under Section 138 of the Negotiable Instruments Act, finding that the Magistrate had issued the summons in a mechanical manner without any application of judicial mind and without fulfilling this mandatory jurisdictional pre-condition.

The respondent-complainant filed a complaint under Section 138 of the Negotiable Instruments Act before the Additional Chief Judicial Magistrate at Khatima, District Udham Singh Nagar, alleging that he had paid Rs. 20 lakhs in cash to the applicant for construction of a residential house. Upon the applicant's failure to carry out the construction, two cheques of Rs. 10 lakhs each, dated June 18, 2022, were issued, both of which were dishonoured on presentation due to insufficiency of funds. After the statutory notice was issued and payment was not made, the complaint was filed. The Magistrate, by order dated July 29, 2022, summoned the applicant. The applicant was admittedly a resident of District Nainital, while the court was situated at Khatima, District Udham Singh Nagar — a different district altogether. No inquiry or investigation under Section 202 CrPC was conducted before the summoning order was passed.

The primary ground of challenge was the mandatory non-compliance of Section 202 CrPC, which provides that when an accused resides at a place beyond the area in which a Magistrate exercises jurisdiction, the Magistrate "shall" — before issuing process — postpone issuance of summons and either conduct an inquiry or direct investigation to decide whether sufficient ground exists to proceed.

Justice Ashish Naithani identified the core issue with precision: the question before the Court was "not the correctness of the allegations on merits, but whether the impugned summoning order suffers from any fundamental legal infirmity warranting interference under Section 482 Cr.P.C." The Court acknowledged that inherent powers are to be exercised sparingly, but held that "where the very initiation of proceedings is vitiated by non-compliance of a mandatory statutory safeguard, the High Court would be justified in stepping in to prevent abuse of the process of court."

On the nature of the Section 202 CrPC obligation, the Court stated: "the proviso to Section 202 Cr.P.C. clearly mandates that before issuance of process, the Magistrate 'shall' postpone the same and either conduct an enquiry himself or direct an investigation for the purpose of deciding whether sufficient ground exists to proceed. This requirement is not an empty formality; rather, it is a substantive safeguard intended to protect persons residing beyond the territorial jurisdiction of the court from being summoned in a mechanical manner."

A perusal of the summoning order dated July 29, 2022 revealed that the Magistrate had not adverted to Section 202 CrPC at all. The order "merely notices the allegations and proceeds to summon the Applicant. There is nothing on record to indicate application of judicial mind to the statutory requirement or to the necessity of preliminary verification. Such an omission goes to the root of the matter and renders the summoning order legally unsustainable."

The Court firmly distinguished the respondent's arguments on merits. While acknowledging that the formal ingredients of Section 138 NI Act appeared to be disclosed and that questions of liability or misuse of cheques were ordinarily matters for trial, the Court held that "the present case stands on a different footing. The defect pointed out is not factual but procedural and jurisdictional. When a mandatory condition precedent to issuance of process has not been fulfilled, the continuation of criminal proceedings would amount to permitting prosecution founded upon an invalid exercise of jurisdiction."

The Court allowed the application under Section 482 CrPC and quashed the summoning order dated July 29, 2022 as well as all consequential proceedings. However, it made clear that this order would not preclude the respondent-complainant from pursuing his remedy in accordance with law, and that the Magistrate would be at liberty to proceed afresh strictly in accordance with law after due compliance with Section 202 CrPC. The judgment firmly establishes that in cheque dishonour cases — where complainants often file cases in distant courts — the Section 202 CrPC inquiry is a non-negotiable jurisdictional threshold that a Magistrate cannot bypass.

Date of Decision: February 27, 2026