Binding precedent and deterrent sentencing in cheque dishonour cases may justify reconsideration of an inadequate sentence.

Article states that courts are bound by the Supreme Court's declaration of law under Article 141 and cannot decline to follow binding precedent on the use of compensation and default sentence under the Code of Criminal Procedure merely because an aspect was not discussed earlier. It also explains that, in cheque dishonour cases, an inadequate sentence that does not reflect the deterrent purpose of Section 138 of the Negotiable Instruments Act may be interfered with where the cheque amount remains unpaid. The conviction was left undisturbed, but sentencing was reopened and remitted for reconsideration after hearing both sides.

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Issues: (i) Whether a High Court can decline to follow the law declared by the Supreme Court on the use of compensation and sentence in default under the Code of Criminal Procedure. (ii) Whether the sentence imposed for dishonour of cheques was so inadequate that it required interference and reconsideration.

Issue (i): Whether a High Court can decline to follow the law declared by the Supreme Court on the use of compensation and sentence in default under the Code of Criminal Procedure.

Analysis: The law declared by the Supreme Court binds all courts under Article 141 of the Constitution of India. A High Court cannot refuse to follow a binding precedent on the ground that some aspect was not adverted to in that decision. Section 431 of the Code of Criminal Procedure provides for recovery of money payable under an order as if it were a fine, and the earlier Supreme Court ruling permitting enforcement of compensation by a sentence in default remained operative.

Conclusion: The High Court was not justified in refusing to follow the binding precedent, and the approval of that line of reasoning was disapproved.

Issue (ii): Whether the sentence imposed for dishonour of cheques was so inadequate that it required interference and reconsideration.

Analysis: The cheque amount remained unpaid and the sentence of imprisonment till rising of the court with a small fine did not reflect the object of Section 138 of the Negotiable Instruments Act. The legislative purpose is to give proper efficacy to cheque dishonour prosecutions, and the court held that such cases require a sentence with real deterrent effect. Since the amount had not been paid, the sentence deserved reconsideration by the trial court after hearing both sides.

Conclusion: The sentence was set aside and the matter was remitted to the trial Magistrate for passing an appropriate sentence after hearing both sides.

Final Conclusion: The appeal succeeded to the extent of reopening the question of sentence, while the conviction remained undisturbed and the trial court was directed to resentence the respondent in accordance with law.

Ratio Decidendi: A court must follow the law declared by the Supreme Court under Article 141, and in cheque dishonour cases the sentencing court may award compensation and enforce it through a sentence in default where legally permissible; an unduly lenient sentence may be interfered with if it undermines the object of the penal provision.

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