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2024 (2) TMI 1151
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....led under Sections 138 and 142 of the Negotiable Instruments Act, 1881 ('NI Act') through Sh. Sumit Gupta, Managing Director, GNG Stock Holding Pvt. Ltd./Respondent herein against the Petitioner Smt. Geeta Monga, in respect of cheque No. 142144 dated 11.03.2020 for Rs. 15,00,000/-, issued by the Petitioner in favour of the Respondent and which on presentation with the bank on 12.03.2020 was dishonoured vide memo dated 13.03.2020 with remarks 'Exceeds Arrangement'. Petitioner and her husband were informed of the dishonour of the cheque, who kept on assuring that the outstanding debt will be cleared and upon their request, the cheque was again presented on 12.04.2020 but was dishonoured vide memo dated 15.04.2020 with remarks 'Funds Insufficient'. Legal notice dated 17.06.2020 was issued by the Respondent calling upon the Petitioner to pay the cheque amount but to no avail and finally, the complaint was filed by the Respondent. 3. As per record, cognizance of the offence was taken under Section 138 of NI Act on 28.03.2022 and notice under Section 251 Cr.P.C. was framed on 11.01.2023. Application filed by the Petitioner seeking discharge was dismissed on 20.03.2023, alluding to the....
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....t Petitioner has raised a plausible defence that the cheque was never issued in favour of the Respondent by the Petitioner and there was no legally enforceable or recoverable debt towards the Respondent, justifying the award of interim compensation. The impugned orders are against the spirit of Section 143A of NI Act, which stipulates that the interim compensation shall not exceed 20% of the cheque amount but does not lay down that in all cases 20% must be awarded. There is no reasoning in the impugned orders indicating why the Trial Court awarded the maximum limit and not any lesser percentage, while exercising the discretion available to it. 6. Per contra, learned counsel for the Respondent argues that Trial Court had framed a notice under Section 251 Cr.P.C. on a prima facie case being established in favour of the Respondent. Petitioner has admitted her signatures on the cheque in question and presumption under Section 139 of NI Act, therefore, arose in favour of the Respondent. Petitioner was adopting all tactics to ensure that the trial is not concluded expeditiously and on several occasions exemption applications were filed. On 20.03.2023, the Trial Court had imposed an ad....
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....case where the petitioner is shown to have already invoked the revisional jurisdiction under Section 397 of the Code. Only in cases where the High Court finds that there has been failure of justice or misuse of judicial mechanism or procedure, sentence or order was not correct, the High Court may, in its discretion, prevent the abuse of the process or miscarriage of justice by exercise of jurisdiction under Section 482 of the Code. It was further held: (SCC p. 248, para 10) "10. Ordinarily, when revision has been barred by Section 397(3) of the Code, a person - accused/complainant - cannot be allowed to take recourse to the revision to the High Court under Section 397(1) or under inherent powers of the High Court under Section 482 of the Code since it may amount to circumvention of the provisions of Section 397(3) or Section 397(2) of the Code." 9. In Kailash Verma v. Punjab State Civil Supplies Corporation and Another, 2005 SCC OnLine SC 120, the Supreme Court observed as under:- "5. It may also be noticed that this Court in Rajathi v. C. Ganesan [(1999) 6 SCC 326 : 1999 SCC (Cri) 1118] said that the power under Section 482 of the Criminal Procedure Code has t....
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....such further period not exceeding thirty days as may be directed by the Court on sufficient cause being shown by the drawer of the cheque. (4) If the drawer of the cheque is acquitted, the Court shall direct the complainant to repay to the drawer the amount of interim compensation, with interest at the bank rate as published by the Reserve Bank of India, prevalent at the beginning of the relevant financial year, within sixty days from the date of the order, or within such further period not exceeding thirty days as may be directed by the Court on sufficient cause being shown by the complainant. (5) The interim compensation payable under this section may be recovered as if it were a fine under Section 421 of the Criminal Procedure Code, 1973 (2 of 1974). (6) The amount of fine imposed under Section 138 or the amount of compensation awarded under Section 357 of the Code of Criminal Procedure, 1973 (2 of 1974), shall be reduced by the amount paid or recovered as interim compensation under this section." 12. In this context, it would be profitable to refer to the judgment of the Madras High Court in V. Mahadevan Iyer v. P. Anbazhagan, 2019 SCC OnLine Mad 3....
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.... This is because of delay tactics of unscrupulous drawers of dishonoured cheques due to easy filing of appeals and obtaining stay on proceedings. As a result of this, injustice is caused to the payee of a dishonoured cheque who has to spend considerable time and resources in court proceedings to realize the value of the cheque. Such delays compromise the sanctity of cheque transactions. 2. It is proposed to amend the said Act with a view to address the issue of undue delay in final resolution of cheque dishonour cases so as to provide relief to payees of dishonour cases so as to provide relief to payees of dishonoured cheques and to discourage frivolous and unnecessary litigation which would save time and money. The proposed amendments will strengthen the credibility of cheques and help trade and commerce in general by allowing lending institutions, including banks, to continue to extend financing to the productive sectors of the economy. 3. It is, therefore, proposed to introduce the Negotiable Instruments (Amendment) Bill, 2017 to provide, inter alia, for the following namely:- (i) to insert a new section 143A in the said Act to provide that the Court t....
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....mental right of an accused person to defend himself in a criminal case. This is the reason why the legislature had thoughtfully used the word "may" under Section 143A(1) of the Negotiable Instruments Act. Therefore, it is not possible to read the word "shall" into the word "may" which is used in the provision. xxx xxx xxx 8. Therefore, whenever the trial Court exercises its jurisdiction under Section 143A(1) of the Act, it shall record reasons as to why it directs the accused person (drawer of the cheque) to pay the interim compensation to the complainant. The reasons may be varied. For instance, the accused person would have absconded for a long time and thereby would have protracted the proceedings or the accused person would have intentionally evaded service for a long time and only after repeated attempts, appears before the Court, or the enforceable debt or liability in a case, is borne out by overwhelming materials which the accused person could not on the face of it deny or where the accused person accepts the debt or liability partly or where the accused person does not cross-examine the witnesses and keeps on dragging with the proceedings by filing one pe....
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.... be exercised depending on its facts, as provision of Section 143A is directory and not mandatory. It was further observed that whenever the Trial Court exercises its jurisdiction under Section 143A(1) of NI Act, it shall record reasons as to why it is directing payment of the interim compensation to the complainant. The Court further observed that the reasons may be varied, for instance accused has absconded for a long time or evades service or the liability to pay is borne out by overwhelming material or where the accused keeps on dragging the proceedings and this list of illustrations is only illustrative. The duty of the Court to give reasons in support of award of interim compensation is reiterated by the High Court of Karnataka in Vijaya v. Shekhapappa and Another, 2022 SCC OnLine Kar 515. 14. From the impugned order dated 18.08.2023 passed by the learned Trial Court, it is discernable that one of the reasons that weighed with the Court to award interim compensation was the adjournments sought by the Petitioner from time to time leading to the conclusion of the trial being delayed. Therefore, in this context, it would be useful to allude to the observations of the Karnatak....
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.... fold: The second fold of discretion in any given case, the compensation may vary from 1% to 20%. It is nowhere depicted in the statute that the amount of interim compensation should be of a particular figure. It can vary from 1% to 20%. It is this variance that gives the learned Magistrate power to exercise discretion to grant such compensation. The mandate of the statute is that it should not exceed 20%. In the cases where learned Magistrate proceeds to grant compensation, has to bear in mind the amount involved in the instrument, as certain transactions would run to several cores and the accused may have formidable defence against the complainant. In such cases, the learned Magistrate should exercise discretion in a cautious manner. Here again the conduct of the accused should be noticed. Therefore, the aforesaid two fold discretion is sine qua non for an order to be passed by the learned Magistrate while considering the application under Section 143A of the Act. xxx xxx xxx 19. There is no reason recorded by the learned Magistrate that the accused in the case at hand has adopted any of the factors as narrated hereinabove that would entail consideratio....
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....t has exercised its discretion rationally, keeping into account the facts of the case and the conduct of the Petitioner and if the exercise of discretion warrants any interference by this Court while exercising inherent powers under Section 482 Cr.P.C. Impugned order dated 18.08.2023 shows that the learned Magistrate has passed a reasoned order supporting the award of compensation in favour of the Respondent. Trial Court observed that Petitioner has admitted her signatures on the cheque in question as well as the factum of issuance of the cheque from her account, leading to the mandatory presumptions under Sections 118A and 139 of the NI Act against her to the effect that the cheque was drawn by her for a consideration and the Respondent Company had received the same in discharge of a debt/liability, from the Petitioner. Trial Court rightly observed that the only factor which could then have come to the rescue of the Petitioner while deciding the application was that Petitioner was not responsible for dragging or delaying the proceedings. Having so stated, the Trial Court, on perusal of the order sheets, came to a finding that on multiple occasions exemption applications were filed....
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....navailability of her counsel. Having perused the order sheets, this Court concurs with the finding of the Trial Court that dilatory tactics were being adopted by the Petitioner by seeking repeated adjournments. The order awarding 20% of compensation also merits no interference for other reasons also, as noted by the learned Trial Court and the Revisional Court that Petitioner admitted her signatures on the cheque as well as the factum of the cheque having been issued from her account albeit the defence was that her business was primarily looked after by her husband and she had no knowledge of the cheque being issued or its dishonour, which would be a matter of trial. 19. As noticed in the earlier part of the judgment, power under Section 482 Cr.P.C. has to be exercised sparingly and not as a substitute for second revision. High Court can entertain a petition under Section 482 Cr.P.C. where there is serious miscarriage of justice and abuse of process of Court or an error of jurisdiction or violation of mandatory provisions of law, however, this provision cannot be invoked calling upon the High Court to substitute its findings for that of the Trial Court or the Revisional Court, p....