Approval to promulgate the Negotiable Instruments (Amendment) Ordinance, 2015.
Approval to promulgate the Negotiable Instruments (Amendment) Ordinance, 2015.
The Union Cabinet, chaired by the Prime Minister Shri Narendra Modi, has given its approval for the proposal to promulgate the Negotiable Instruments (Amendment) Ordinance, 2015.
The proposed amendments to the Negotiable Instruments Act, 1881 (“The NI Act”) are focused on clarifying the jurisdiction related issues for filing cases for offence committed under section 138 of the NI Act.
The clarity on jurisdictional issues for trying cases of cheque bouncing would increase the credibility of the cheque as a financial instrument. This would help trade and commerce in general and allow the lending institution, including banks, to continue to extend financing to the economy, without the apprehension of loan default on account of bouncing of a cheque.
In view of the urgency to create a suitable legal framework for determination of the place of jurisdiction for trying cases of dishonour of cheques under section 138 of the NI Act, the Government has decided to amend the law through the Negotiable instruments (Amendment) Ordinance, 2015.
The objective is to ensure that a fair trial is conducted keeping in view the interests of the complainant by clarifying the territorial jurisdiction for trying the cases for dishonour of cheques. The Ordinance is similar to the Bill in the sense that the substantive principle for determination of the jurisdiction of cases under section 138 of the NI Act remains the same, except that that two distinct situations of payment of cheque (i) by submitting the same for collection through an account or (ii) payment of a cheque otherwise through an account, that is, when cheques are presented across the counter of any branch of drawee bank for payment, are covered under the Ordinance.
Background:
Section 138 of the NI Act deals with the offence pertaining to dishonour of cheque for insufficiency, etc., of funds in the drawer’s account on which the cheque is drawn for the discharge of any legally enforceable debt or other liability. The object of the NI Act is to encourage the usage of cheques and enhancing the credibility of the instrument so that the normal business transactions and settlement of liabilities can be ensured.
Various financial institutions and industry associations have expressed difficulties, arising out of the recent legal interpretation of the place of jurisdiction for filing cases under Section 138 to be the place of drawers’ bank by the Supreme Court. To address the difficulties faced by the payee or the lender of the money in filing the cases under Section 138 of the NI Act, because of which, large number of cases were stuck, the jurisdiction for offence under Section 138 has been proposed to be clearly defined. Accordingly, the Negotiable Instruments (Amendment) Bill, 2015 (“the Bill”) in Parliament was introduced in Lok Sabha on 6th May, 2015 and considered and passed by Lok Sabha on 13th May, 2015. However, since the Rajya Sabha was adjourned sine die on 13th May, 2015, the Bill could not be discussed and passed by that House and the Bill could not be enacted.
The Bill provides for filing of cases only by a court within whose local jurisdiction the bank branch of the payee, where the payee delivers the cheque for payment is situated. Further, where a complaint has been filed against the drawer of a cheque in the court having jurisdiction under the new scheme of jurisdiction, all subsequent complaints arising out of section 138 against the same drawer shall be filed before the same court, irrespective of whether those cheques were presented for payment within the territorial jurisdiction of that court.
Further, it has been provided that if more than one prosecution is filed against the same drawer of cheques before different courts, upon this fact having been brought to the notice of the court, the court shall transfer the case to the court having jurisdiction as per the new scheme of jurisdiction.
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Ex-Post-Facto approval to capital infusion made in India Infrastructure Finance Company Ltd. during 2007-08 to 2012-13
The Union Cabinet chaired by the Prime Minister Shri Narendra Modi, has given its ex-post facto approval to the capital infusion of Rs. 2600 crore made in India Infrastructure Finance Company Ltd. (IIFCL). During 2007-08 to 2012-13, as approved in the Demand for grants to support the future growth of the company.
The capital infusion was made as approved in the Demands for Grants and consented by the Finance Minister to support the future growth of the company.
Background:
IIFCL, a wholly owned Government of India company, was, incorporated on January 5, 2006 under the Companies Act, 1956 with an authorized share capital of Rs. 1000 crore. It commenced its, operations from April 2006. IIFCL was mandated to provide long term debt to viable' infrastructure projects in terms of the Scheme for Financing Viable Infrastructure Projects through IIFCL (broadly referred to as SIFTI).
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Proposal for providing concessional financing scheme to support Indian companies bidding for strategically important infrastructure projects abroad
The Union Cabinet chaired by the Prime Minister Shri Narendra Modi, has given its approval to a scheme to enable EXIM Bank to offer concessional finance to support Indian companies bidding for strategically important infrastructure projects abroad.
This will help Indian companies to bid for large projects abroad.
The repayment of the loan would be guaranteed by the foreign Government. The strategic importance of a project, to deserve financing under this scheme, will be decided, on a case by case basis, by a Committee chaired by Secretary (DEA) and will have members from the Department of Expenditure, Ministry of External Affairs, Department of Industrial Promotion and Policy, Department of Commerce, Department of Financial Services and Ministry of Home Affairs. The Deputy National Security Adviser will also be a member of this Committee. The Committee will have powers on conditions within reasonable limits, on a case by case basis, during the first two years of implementation of the scheme. The projects financed under these terms will be monitored by the Committee. The Committee will also consider financing strategic projects through Public Sector banks other than EXIM Bank on the same terms. The Committee may insist on sourcing of at least 75 percent of the project requirements from India, if it is found compatible with the requests for bids. The experience with this scheme will be evaluated after two years.
Background:
There are a number of Indian large project implementation companies which have developed a lot of expertise in building large infrastructure projects. However, they have not been able to win contracts abroad due to higher cost of finance in India. It is felt necessary to help such Indian Companies/entities secure contracts abroad, if it is in India’s strategic interest to have the projects implemented by Indian Companies.
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