___________________ vs State Of Himachal Pradesh
2021 Latest Caselaw 2742 HP

IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA

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Cr.MMO No.574 of 2019

Reserved on 23rd April, 2021 Decided on : _27th April, 2021

___________________ Mythri Projects and others ...Petitioners.

                                   Versus





    State of Himachal Pradesh                                      ...Respondents.
                                                                                __________
    Coram:

The Hon'ble Mr. Justice Anoop Chitkara, Judge.

Whether approved for reporting?1 No.

For the petitioner : Mr. Sandeep Pandey, Advocate.

For the respondent : Mr. Nand Lal Thakur, Additional Advocate General, for Respondent No.1/State.

Mr. Arun Kumar, Advocate, vice Mr. Ajay Kumar Dhiman, Advocate, for Respondent No.2.

PROCEEDIGNS CONVENED THROUGH VIDEO CONFERENCE

Anoop Chitkara, Judge

The petitioner, who is facing a criminal prosecution for the commission of offence

punishable under Section 138 of the Negotiable Instruments Act, 1881, has come up before this Court under Section 482 of the Code of Criminal Procedure, for quashing the proceedings because the parties have compromised the matter.

2. Learned counsel for the parties, state that the matter stands compromised between the parties and thus the complaint and all consequent proceedings be quashed.

Whether reporters of Local Papers may be allowed to see the judgment?

REASONING:

3. A perusal of the petition reveals that the accused has met all the liability as detailed in the petition. The complainant had put in appearance and on 23.4.2021, made

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a statement on oath that he had received the full and final payment and prays for closure of the complaint/case. The said statement forms part of the record.

4. The jurisprudence behind the N.I. Act is that the business transactions are honored. The legislative intention is not to send the people to suffer incarceration because their cheque was bounced. These proceedings are to execute the recovery of cheque amount by showing teeth of penalty loss.

5. Hon'ble Supreme Court held as follows:

[11].

r to In Kaushalya Devi Massand v Roopkishore Khore, (2011) 4 SCC 593, the

Having considered the submissions made on behalf

of the parties, we are of the view that the gravity of a complaint under the Negotiable Instruments Act cannot be equated with an offence under the provisions of the Indian Penal Code or other criminal offences. An offence under Section 138 of the Negotiable Instruments Act, 1881, is almost in the nature of a

civil wrong which has been given criminal overtones. [12]. The learned Magistrate, in his wisdom was of the view that imposition of a fine payable as compensation to the Appellant was sufficient to meet the ends of justice in the instant

case. Except having regard to the submission made that the Appellant/ complainant, is a widowed lady of advanced age, there is no other special circumstance which calls for

interference with the order of the learned Magistrate, as confirmed by the High Court, with an increased fine. [13]. After an interval of 14 years, we are not inclined to

interfere with the order of the High Court impugned in the appeal, except to the extent of increasing the amount of compensation payable by a further sum of ` 2 lakhs. The said amount of ` 2 lakhs in addition to the sum of ` 6 lakhs already directed to be paid by the Respondent to the Appellant, shall be deposited in the Trial Court within two weeks from date and upon such deposit being made, the Appellant will be at liberty to withdraw the same by way of compensation, together with the amounts already deposited, if not already withdrawn. In default of such deposit, the Appellant shall undergo one month's simple imprisonment.

6. The Hon'ble Supreme Court in Meters and Instruments Private Limited and another v Kanchan Mehta,(2018) 1 SCC 560 holds, [18]. From the above discussion following aspects emerge: [18.1]. Offence under Section 138 of the Act is primarily a

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civil wrong. Burden of proof is on accused in view

presumption under Section 139 but the standard of such proof is "preponderance of probabilities". The same has to be normally tried summarily as per provisions of summary trial under the Cr.P.C. but with such variation as may be

appropriate to proceedings under Chapter XVII of the Act. Thus read, principle of Section 258Cr.P.C. will apply and the Court can close the proceedings and discharge the accused on satisfaction that the cheque amount with assessed costs and interest is paid and if there is no reason to proceed with the

punitive aspect.

[18.2] The object of the provision being primarily compensatory, punitive element being mainly with the object of enforcing the compensatory element, compounding at the initial stage has to be encouraged but is not debarred at later

stage subject to appropriate compensation as may be found acceptable to the parties or the Court.

[18.3]. Though compounding requires consent of both parties, even in absence of such consent, the Court, in the interests of justice, on being satisfied that the complainant has been duly compensated, can in its discretion close the proceedings and discharge the accused.

[18.4]. Procedure for trial of cases under Chapter XVII of the Act has normally to be summary. The discretion of the Magistrate under second proviso to Section 143, to hold that it was undesirable to try the case summarily as sentence of

more than one year may have to be passed, is to be exercised after considering the further fact that apart from the sentence

of imprisonment, the Court has jurisdiction under Section 357(3) Cr.P.C. to award suitable compensation with default sentence under Section 64 I.P.C. and with further powers of recovery under Section 431Cr.P.C. With this approach,

prison sentence of more than one year may not be required in all cases.

[18.5]. Since evidence of the complaint can be given on affidavit, subject to the Court summoning the person giving affidavit and examining him and the bank's slip being prima facie evidence of the dishonor of cheque, it is unnecessary for the Magistrate to record any further preliminary evidence. Such affidavit evidence can be read as evidence at all stages of trial or other proceedings. The manner of examination of the person giving affidavit can be as per Section 264Cr.P.C. The scheme is to follow summary procedure except where exercise of power under second proviso to Section 143

becomes necessary, where sentence of one year may have to be awarded and compensation under Section 357(3) is considered inadequate, having regard to the amount of the cheque, the financial capacity and the conduct of the accused or any other circumstances.

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7. Given the judgment passed by Hon'ble Supreme Court of India in Damodar S. Prabhu v Sayed Babalal, (2010) 5 SCC 663, the law is well settled that when the entire money is paid, then the complainant cannot have any objection to such

compromise, and 5% of the cheque amount is to be paid by the accused to the Himachal Pradesh State Legal Services Authority.

8. This Court has inherent powers under Section 482 of the Code of Criminal

Procedure, further supported by Section 147 of the N.I. Act to interfere in this kind of matter where parties have paid the entire money and where the complainant does not object to clear all the proceedings. Given the entirety of the case and judicial precedents,

I am of the considered opinion that the continuation of these proceedings will not

suffice any fruitful purpose whatsoever.

9. Therefore, I am of the considered opinion that because of the compromise, this is

a fit case where the inherent jurisdiction of the High Court under Section 482 of the Code of Criminal Procedure read with 147 of Negotiable Instruments Act, is invoked to compound the offence and consequently to quash the proceedings mentioned above.

10. In Shakuntala Sawhney v Kaushalya Sawhney, (1979) 3 SCR 639, at p 642,

Hon'ble Supreme Court observed that the finest hour of Justice arise propitiously when parties, despite falling apart, bury the hatchet and weave a sense of fellowship or

reunion.

11. Consequently, given the compounding of offences, the proceedings are quashed. Accordingly, the petitioner is acquitted of the offence under Section 138 of the Act.

12. The amount of cheque in question was Rs.Thirty lacs and the trial was pending before the Trial Court i.e., Ld. Additional Chief Judicial Magistrate, Court No.1, Ghumarwin District Bilaspur, H.P. As such the accused No. 1, (Mythri Projects) is to

pay compensation at the rate of 5%, which comes out to be Rs. 1,50,000/-. The petitioner shall deposit aforesaid amount in the account of the concerned HP Legal Aid Authority, on or before 30 June 2021, failing which this entire order, including

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compounding, shall automatically stand recalled, and this petition shall be posted for

hearing on merits. However, in extraordinary circumstances, the petitioner may approach this Court for an extension of time to deposit the compounding fee. Petitioner to file the receipt in the Registry.

13. Based on the compromise, the petitioner makes out a case for closure of the proceedings. Accordingly, the proceedings pending before learned Additional Chief

Judicial Magistrate Court No.1, Ghumarwin, District Bilaspur, H.P., in case No.1-3 of 2016 titled as M/s Rajindra Filling Station vs. Mythri Projects and others, are closed.

The petition stands allowed in the terms mentioned above. Copy Dasti.

(Anoop Chitkara), Judge.

April 27, 2021 (KS)