TaxTMI 
TaxTMI 
TaxTMI 
2024 (3) TMI 273
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....e and clarity, the parties are referred to in the capacity in which they are arrayed before the learned Magistrate. 3.2 The complainant-Respondent No. 2 claimed to have rendered certain consultancy services to the accused-Petitioner, who runs M/s. Chetak Construction Company and other entities. The consultancy charges were overdue. A purported settlement was arrived at between the complainant and the accused. The accused had drawn cheques bearing Nos. 411196 and 491942 dated 5 October 2016 and 22 December 2016 in the sum of Rs. 10,00,000/- and Rs. 11,50,000/- respectively, towards the full and final settlement of the claim of the complainant. 3.3 Both the cheques were, however, dishonoured on presentment. On 19 January 2017, the complainant addressed a demand notice calling upon the accused to pay the amount covered by the dishonoured cheques. The complainant asserts, the accused addressed a letter dated 1 March 2017 acknowledging the liability, and also assured to pay the due amount by 31 March 2017. In the event of default, the accused offered to pay interest @ Rs. 30,000/- p.m. till the payment of the full amount. The accused requested the complainant not to further proceed wi....
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....l approach which may be justifiable in civil proceedings cannot be adopted in a prosecution for an offence under Section 138 of the Act, 1881, as penal consequences ensue. Thirdly, in the facts of the case, according to Mr. Pandey, the reasons ascribed by the complainant that on account of the assurances allegedly made by the accused, he did not lodge the complaint within the stipulated time, cannot be said to be factually sustainable and thus, cannot a constitute sufficient cause for the condonation of delay. 6. Mr. Udwadia, learned Counsel for Respondent No. 2 supported the impugned orders. It was urged that since the learned Magistrate as well as the learned Additional Sessions Judge have exercised discretion to condone the delay, this Court may not interfere with the impugned orders in exercise of its extra ordinary writ jurisdiction. Mr. Udwadia would further submit that once the court is empowered to condone the delay, the submission that in case of a prosecution the court should adopt a different yardstick in the matter of condonation of delay cannot be accepted. Lastly, it was urged that it is not the length of the delay but the cause assigned for the delay which is of det....
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....tion of the matter on merits rather than on technicalities promotes the cause of justice. Ordinarily, courts lean in favour of condonation of delay, in the absence of willful negligence or want of bonafides. The prescription of period of limitation is, thus, not premised on the destroying rights of the parties but as a bar to the remedy, as an indefinite period to enforce such remedy is fraught with the consequence of uncertainty and absence of finality to the prospect of litigation. 12. There is a subtle yet significant difference in the approach of the court when the court at the first instance has exercised its discretion to condone the delay and in cases where the application for condonation of delay is rejected by such court. In the former case, since the court below has exercised its discretion in a positive manner to condone the delay, ordinarily the superior court should not interfere with such a finding, as it has the potentiality to promote the cause of substantive justice. However, where the court at the first instance refuses to condone the delay, the superior court is at liberty to reassess the entire matter of condonation of delay and arrive at its own conclusion, de....
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.... be fixed for each remedy. Unending period for launching the remedy may lead to unending uncertainty and consequential anarchy. Law of limitation is thus founded on public policy. It is enshrined in the maxim Interest reipublicae up sit finis litium (it is for the general welfare that a period be putt to litigation). Rules of limitation are not meant to destroy the right of the parties. They are meant to see that parties do not resort to dilatory tactics but seek their remedy promptly. The idea is that every legal remedy must be kept alive for a legislatively fixed period of time. 12. A court knows that refusal to condone delay would result foreclosing a suitor from putting forth his cause. There is no presumption that delay in approaching the court is always deliberate. This Court has held that the words "sufficient cause" under Section 5 of the Limitation Act should receive a liberal construction so as to advance substantial justice vide Shakuntala Devi Jain V/s. Kuntal Kumari AIR 1969 SC 575 and State of W.B. V/s. Administrator, Howrah Municipality (1972) 1 SCC 366. 13. It must be remembered that in every case of delay there can be some lapse on the part of the litig....
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....n with, from the text of proviso to Section 142(1)(b), such restrictive approach in the matter of condonation of delay is not evident. At the same time, it needs to be emphasised that there is a qualitative difference between proceedings which have civil consequences and one's which entail penal consequences. The difference in the approach in the matter of condonation of delay, therefore, cannot be said to be inconceivable. 18. De hors the aspect of limitation, where there is no statutory prescription of limitation for filing the complaint and/or lodging the prosecution, the inordinate delay in commencement of the criminal proceedings has the propensity to infringe the right of an accused to speedy trial guaranteed under Article 21 of the Constitution of India. In exercise of inherent power under Section 482 of the Code of Criminal Procedure or plenary writ jurisdiction, the High Court may be justified in quashing a proceeding for inordinate delay in the commencement of such proceedings. Viewed through this prism, the aspect of condonation of delay in commencement of the prosecution, requires striking of a delicate balance between the interest of the society in prosecution of an o....
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....ion. 22. Re-adverting to the facts of the case, the nature of the proceedings in a complaint under Section 138 of the Act, assumes significance. Learned Counsel for the Petitioner made an earnest endeavour to draw home the point that the prosecution for an offence under Section 138 of the Act, entails punishment, and, therefore, a strict interpretation is the norm. The courts below could not have, therefore, condoned the delay in a light manner. 23. The aforesaid submission regarding the nature of the proceeding under Section 138 of the Act, cannot be subscribed to, unreservedly. Chapter XVII came to be inserted in the N.I. Act by the Amendment Act, 1988 with the object of enhancing the acceptability of the cheques for the settlement of liabilities. The primary object of visiting the penal consequences to the dishonour of the cheque is not mere penal, but also to maintain the efficiency and value of a negotiable instrument in commercial transactions by making the accused to honour the negotiable instrument and pay the amount for which such instrument had been drawn. The object of provisions contained in Chapter XVII has thus been described as both punitive and compensatory. 24. ....
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....C 705. The Supreme Court observed that the nature of the offence under Section 138 of the NI Act is quasi-criminal in that, while it arises out of a civil wrong, the law, however, imposes a criminal penalty in the form of imprisonment or fine. The purpose of the enactment is to provide security to creditors and instil confidence in the banking system of the country. Laying emphasis on the fact that the statutory regime under the Act, 1881 permits composition of the offence during the pendency of the trial and even after the conviction, the Supreme Court observed that, given that the primary purpose of Section 138 of the NI Act is to ensure compensation to the complainant, the NI Act also allows for parties to enter into a compromise, both during the pendency of the complaint and even after the conviction of the accused. 27. In the case of Damodar S. Prabhu V/s. Sayed Babalal H (2010) 5 SCC 663, the Supreme Court has observed that it is quite obvious that with respect to offence of dishonour of cheques, it is compensatory aspect of the remedy which should be given priority over the punitive aspect. 28. The aforesaid being the nature of the proceedings under Section 138 of the Act,....