2019 (8) TMI 1921 - HC - Indian Laws

Court Rules Section 143A of Negotiable Instruments Act Applies Prospectively; Quashes Trial Court's 20% Deposit Order

Budh Ram Regar Versus Sanwar Mal Mochi

The court determined that Section 143A of the Negotiable Instruments Act, which allows for interim compensation in cheque dishonor cases, is prospective ... Application of Section 143A of the Negotiable Instruments Act - retrospectve or prospective application - Section 143A could be applied to cases where the offence under Section 138 of the Act was committed prior to the introduction of Section 143A on September 1, 2018 - HELD THAT:- The question which arose before the Hon'ble Apex Court in the case of G.J. Raja [2019 (8) TMI 91 - SUPREME COURT] was whether Section 143A of the Act is retrospective in operation and can be invoked in cases where the offences punishable Under Section 138 of the Act were committed much prior to the introduction of Section 143A. Hon'ble Apex Court after considering previous judgments including the case of Surinder Singh Deswal [2019 (5) TMI 1626 - SUPREME COURT] held that 'Section 143A to be prospective in operation and that the provisions of said Section 143A can be applied or invoked only in cases where the offence Under Section 138 of the Act was committed after the introduction of said Section 143A in the statute book.' The impugned order dated 24.07.2019 is not sustainable and same is hereby quashed and set aside - petition allowed. ISSUES PRESENTED and CONSIDEREDThe primary issue considered in this judgment is whether Section 143A of the Negotiable Instruments Act is retrospective in operation. Specifically, the court examined if Section 143A could be applied to cases where the offence under Section 138 of the Act was committed prior to the introduction of Section 143A on September 1, 2018.ISSUE-WISE DETAILED ANALYSISRelevant Legal Framework and PrecedentsSection 143A of the Negotiable Instruments Act allows for interim compensation to be paid by the accused in cheque dishonor cases. The provision was introduced to provide relief to the complainant during the pendency of the trial. The legal question arose regarding its applicability to offences committed before its enactment.The court referred to the precedent set by the Supreme Court in the case of G.J. Raja vs. Tejraj Surana, which addressed the prospective nature of Section 143A. The judgment also discussed the case of Surinder Singh Deswal vs. Virender Gandhi, which dealt with Section 148 of the same Act, highlighting the differences in their applicability.Court's Interpretation and ReasoningThe court, following the Supreme Court's reasoning in G.J. Raja, concluded that Section 143A is prospective in nature. The court emphasized that Section 143A applies only to offences committed after its introduction on September 1, 2018. The court distinguished this from Section 148, which was deemed retrospective because it applies at the appellate stage, where the accused has already been found guilty.Key Evidence and FindingsThe court relied on the Supreme Court's interpretation of the legislative intent behind Section 143A, which was to provide interim relief during trials commenced after the provision's enactment. The court found no evidence or legislative intent suggesting that Section 143A should apply retrospectively.Application of Law to FactsThe petitioner in this case was directed by the trial court to deposit 20% of the cheque amount based on Section 143A. However, the offence in question occurred in 2016, prior to the enactment of Section 143A. Applying the Supreme Court's interpretation, the court held that the trial court's order was not sustainable as Section 143A could not be applied retrospectively to the petitioner's case.Treatment of Competing ArgumentsThe court noted that the public prosecutor did not oppose the petitioner's submissions, indicating a lack of contention against the prospective application of Section 143A. The court's analysis focused on aligning with the Supreme Court's interpretation, which was unchallenged by the respondents.ConclusionsThe court concluded that the trial court's order directing the petitioner to deposit 20% of the cheque amount under Section 143A was unsustainable. The court quashed the order and directed the trial court to expedite the trial without applying Section 143A retrospectively.SIGNIFICANT HOLDINGSThe court reaffirmed the principle that Section 143A of the Negotiable Instruments Act is prospective in operation. It established that the provision can only be applied to offences under Section 138 committed after September 1, 2018. The judgment emphasized the importance of adhering to legislative intent and existing legal principles regarding the retrospective application of laws.The court's final determination was to quash the trial court's order requiring the petitioner to deposit interim compensation, as it was based on a misapplication of Section 143A. The court directed the trial court to proceed with the trial without imposing the interim compensation requirement retroactively.