Court quashes interim compensation order, directs new order issuance, and emphasizes focus on valid cheques.

The court partially allowed the petition, quashing the interim compensation order due to lack of proper reasoning and directing the Magistrate to issue a new order. The proceedings on the complaint were to proceed, focusing only on the five valid cheques, with the court emphasizing the Magistrate's consideration of this aspect during the trial.

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Issues Involved:
1. Validity of the complaint based on stale cheques.
2. Legality of the interim compensation order dated 23.07.2021/29.07.2021.

Issue-wise Detailed Analysis:

1. Validity of the Complaint Based on Stale Cheques:
The petitioner challenged the complaint on the ground that some cheques were not presented for encashment within their validity period. Specifically, cheques dated 01.02.2019 and 04.01.2019 were alleged to be stale. Upon review, it was found that the cheque dated 04.01.2019 was indeed presented after its validity period, making it stale. However, the cheque dated 01.02.2019 was presented within its validity period when excluding the day of presentment as per Section 24 of the NI Act. The court noted that the complaint involved six cheques, but only one was stale. The prosecution under Section 138 of the NI Act was found to be maintainable for the other five valid cheques. It was concluded that the complaint should proceed regarding the five valid cheques, and the learned trial Magistrate should consider this aspect during the trial.

2. Legality of the Interim Compensation Order Dated 23.07.2021/29.07.2021:
The petitioner contended that the interim compensation order was invalid because it was dated when the Presiding Officer was on leave, suggesting non-application of mind and potential tampering. The court found that the order was announced on 29.07.2021, but the date was mistakenly recorded as 23.07.2021, an inadvertent error not rendering the order illegal. Additionally, the petitioner argued that the order lacked reasons for awarding interim compensation. Section 143-A of the NI Act grants discretionary power to award interim compensation, but such discretion must be exercised with reason and logic. The court found the order devoid of reasons and noted the inclusion of the stale cheque amount, indicating non-application of mind. Consequently, the order was quashed, and the Magistrate was directed to pass a fresh order with proper reasoning after hearing the parties.

Conclusion:
The petition was partly allowed. The interim compensation order was quashed, and the Magistrate was directed to issue a new order considering the court's observations. The proceedings on the complaint were to continue but limited to the five valid cheques. A copy of the order was sent to the Magistrate for compliance.

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