2010 (1) TMI 570 - SC - Companies Law

Appeal allowed: section 145(2) affidavit evidence for accused in sections 143-146 disallowed; section 296(2) CrPC and Naib Din inapplicable

SC allowed the appeal and set aside the HC direction permitting the accused to tender evidence by affidavit under section 145(2) of the Act. The Court ... Provisions of sections 143, 144, 145 and 147 - Right of the accused - undoubtedly cross-examine a person whose evidence is given on affidavit but the accused cannot insist that the witness - Applicability of the provisions of sub-sections (1) and (2) of section 145 - HELD THAT:- Neither section 296(2) of the Code nor the decision in Naib Din’s case [2001 (9) TMI 1167 - SUPREME COURT] has any relevance or application to the trial concerning a dishonoured cheque under sections 143 to 146 of the Act. The decision in Naib Din’s case (supra) was rendered in a totally different context and the issue before the Court was not, whether on being summoned on the application made by the accused, the person giving evidence on affidavit must begin his deposition with examination-in-chief. The appellants are reading into the passage from the decision in Naib Din’s case (supra) something that was not said by the Court. Moreover, the crucial difference between section 296(2) of the Code and section 145(2) of the Act is that the former deals with the evidence of a formal nature whereas under the latter provision, all evidences including substantive evidence may be given on affidavit. Section 296 is part of the elaborate procedure of a regular trial under the Code while the whole object of section 145(2) of the Act is to design a much simpler and swifter trial procedure departing from the elaborate and time consuming trial procedure of the Code. Hence, notwithstanding the apparent verbal similarity between section 145(2) of the Act and section 296(2) of the Code, it would be completely wrong to interpret the true scope and meaning of the one in the light of the other. Neither the legislative history of section 296(2) nor any decision on that section can persuade us to hold that under section 145(2) of the Act, on being summoned at the instance of the accused the complainant or any of his witnesses should be first made to depose in examination-in-chief before cross-examination. The High Court was fully conscious that section 145(1) does not provide for the accused to give his evidence, like the complainant, on affidavit. But the High Court argued that there was no express bar in law against the accused giving his evidence on affidavit and more importantly providing a similar right to the accused would be in furtherance of the legislative intent to make the trial process swifter. The case of the complainant in a complaint under section 138 of the Act would be based largely on documentary evidence. The accused, on the other hand, in a large number of cases, may not lead any evidence at all and let the prosecution stand or fall on its own evidence. In case the defence does lead any evidence, the nature of its evidence may not be necessarily documentary; in all likelihood the defence would lead other kinds of evidences to rebut the presumption that the issuance of the cheque was not in the discharge of any debt or liability. This is the basic difference between the nature of the complainant’s evidence and the evidence of the accused in a case of dishonoured cheque. It is, therefore, wrong to equate the defence evidence with the complainant’s evidence and to extend the same option to the accused as well. Thus, we have no hesitation in holding that the High Court was in error in taking the view, that on a request made by the accused the Magistrate may allow him to tender his evidence on affidavit and consequently, we set aside the direction as contained in sub-paragraph (r) of paragraph 45 of the High Court judgment. The appeal arising from SLP (Crl.) No. 3915/2006 is allowed. Issues Involved:1. Extent of the right of the accused under section 145(2) of the Negotiable Instruments Act, 1881.2. Applicability of the provisions of sub-sections (1) and (2) of section 145 to proceedings pending on February 6, 2003.3. Whether the right to give evidence on affidavit is also available to the accused.Detailed Analysis:1. Extent of the Right of the Accused under Section 145(2):The primary issue was whether the accused has the right to insist that the complainant or his witness, who has given evidence on affidavit, should first give deposition in examination-in-chief before being cross-examined. The High Court held that the accused could cross-examine a person whose evidence is given on affidavit, but cannot insist on a fresh examination-in-chief. The Supreme Court upheld this view, emphasizing that section 145(2) does not suggest that the person giving evidence on affidavit must start with an examination-in-chief. The Court noted that the affidavit is in the nature of an examination-in-chief, and on being summoned, the deponent can only be cross-examined. This interpretation aligns with the legislative intent to simplify and expedite the trial process under sections 143 to 147 of the Act.2. Applicability of Provisions to Pending Proceedings:The second issue was whether the provisions of sub-sections (1) and (2) of section 145 apply to cases pending on February 6, 2003, when these provisions were inserted. The High Court held that these provisions are procedural and not substantive, thus applicable to pending cases. The Supreme Court agreed, citing that procedural laws typically apply retrospectively unless explicitly stated otherwise. The Court referenced the decision in Gurbachan Singh v. Satpal Singh, affirming that procedural changes do not affect substantive rights and are generally applied to ongoing cases.3. Right of the Accused to Give Evidence on Affidavit:The third issue was whether the accused could also give evidence on affidavit, similar to the complainant. The High Court permitted this, arguing there was no express bar against it and it would further the legislative intent of expediting trials. However, the Supreme Court disagreed, stating that the legislature did not provide this right to the accused in section 145(1). The Court emphasized that it is not within the judiciary's purview to fill perceived legislative gaps. The nature of evidence from the complainant and the accused differs significantly, and extending the same right to the accused would be inappropriate. Consequently, the Supreme Court set aside the High Court's direction allowing the accused to tender evidence on affidavit.Conclusion:The Supreme Court upheld the High Court's interpretation regarding the extent of the accused's right under section 145(2) and the retrospective applicability of the procedural provisions. However, it overturned the High Court's decision allowing the accused to give evidence on affidavit, reinforcing the principle that courts should not assume legislative functions. The appeals concerning the right to cross-examine without fresh examination-in-chief and the retrospective application of procedural provisions were dismissed, while the appeal regarding the accused's right to give evidence on affidavit was allowed.