Sessions Court must reconsider waiver of 20% fine deposit under Section 148 NI Act based on exceptional circumstances

HC remanded the case to Sessions Court for fresh consideration regarding waiver of 20% fine deposit under Section 148 NI Act during pendency of appeal against Section 138 conviction. Petitioner claimed three exceptional circumstances: pendency of insolvency petition, medical condition, and consumer complaints seeking same amount. Sessions Court had not properly addressed medical condition argument despite being raised in application. HC directed Sessions Court to decide afresh whether these circumstances warrant waiver of deposit condition, allowing petitioner to raise additional exceptional circumstances.

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Issues Involved:
1. Quashing of the order directing deposit of Rs. 1,20,00,000/- within 30 days under Section 148 of the Negotiable Instruments Act, 1881.
2. Consideration of exceptional circumstances for waiving the deposit requirement.

Summary:

Issue 1: Quashing of the Order
The petitioner sought quashing of the order dated 20.01.2020, passed in C.A. No. 174/2019, which directed the petitioner to deposit Rs. 1,20,00,000/- within 30 days under Section 148 of the Negotiable Instruments Act, 1881 (NI Act). The petitioner was convicted by the learned Metropolitan Magistrate for the offense under Section 138 of the NI Act and was sentenced to six months of simple imprisonment along with a compensation payment of Rs. 6 crores. The petitioner's appeal led to the suspension of the sentence, but the Sessions Court dismissed the application seeking waiver of the deposit of 20% of the compensation amount.

Issue 2: Consideration of Exceptional Circumstances
The petitioner argued that the Sessions Court failed to consider exceptional circumstances warranting the waiver of the deposit. These included the petitioner's financial and health conditions and the pendency of insolvency proceedings. The petitioner cited the Supreme Court's decision in Jamboo Bhandari v. M.P. State Industrial Development Corporation, which states that the imposition of a 20% deposit is not an absolute rule and can be waived under exceptional circumstances. The petitioner's counsel highlighted three main points:
1. Financial hardship due to insolvency proceedings.
2. The pendency of consumer complaints against the insurance company seeking the same amount.
3. The petitioner's severe health issues, including Multiple Sclerosis.

Court's Decision:
The High Court noted that the Sessions Court had considered the insolvency proceedings but did not address the petitioner's health condition adequately. The High Court also recognized the additional argument regarding the consumer complaints, which was not presented before the Sessions Court.

The High Court, referencing the Supreme Court's decision in Jamboo Bhandari, held that the case should be remanded back to the Sessions Court to reconsider whether the exceptional circumstances justify waiving the deposit requirement. The Sessions Court is directed to decide the issue within two months, considering all arguments and any additional exceptional circumstances the petitioner may present.

The petition was disposed of with these directions, and the judgment was to be forwarded to the concerned Sessions Court for further action.

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