Kerala High Court
Eurotech Polymers vs State Of Kerala on 21 October, 2022
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MRS. JUSTICE MARY JOSEPH
FRIDAY, THE 21ST DAY OF OCTOBER 2022 / 29TH ASWINA, 1944
CRL.MC NO. 5043 OF 2022
AGAINST THE ORDER/JUDGMENT IN CC 226/2022 OF JUDICIAL FIRST CLASS
MAGIST. COURT, CHOTTANIKKARA(TEMPORARY) DATED 17.05.2022
PETITIONER/ACCUSED:
1 EUROTECH POLYMERS
PARAKKULAM, ANAKKARA P.O., PALAKKAD DISTRICT-
679551 REPRESENTED BY ITS MANAGING PARTNER ABDUL
RASHEED, PIN - 679551
2 ABDUL RASHEED M.C.,AGED 52 YEARS
S/O UMMAR, MANIKULATHIL HOUSE, KALATHILPADI,
ERAMANGALAM P.O., VELIYANKODE, MALAPPURAM
DISTRICT- 679587 MANAGING PARTNER, M/S EUROTECH
POLYMERS, PARAKKULAM, ANAKKARA P.O., PALAKKAD
DISTRICT, PIN - 679587
BY ADVS.ANAND KALYANAKRISHNAN
C.DHEERAJ RAJAN
RESPONDENTS/STATE & DEFACTO COMPLAINANT:
1 STATE OF KERALA
REPRESENTED BY PUBLIC PROSECUTOR,HIGH COURT OF
KERALA, PIN - 682031
2 BABU C.Y.,AGED 58 YEARS
S/O YOHANNAN, CHAMAKKALAYIL HOUSE, KANAYANNUR,
CHOTTANIKKARA P.O., ERNAKULAM, PIN - 682312
OTHER PRESENT:
PP SRI.V.S. SREEJITH
THIS CRIMINAL MISC. CASE HAVING COME UP FOR ADMISSION
ON 21.10.2022, ALONG WITH Crl.MC.5045/2022 AND CONNECTED
CASES, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:
Crl.M.C. Nos. 5043, 5045 & 5046 of 2022
-:2:-
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MRS. JUSTICE MARY JOSEPH
FRIDAY, THE 21ST DAY OF OCTOBER 2022 / 29TH ASWINA, 1944
CRL.MC NO. 5045 OF 2022
AGAINST THE ORDER/JUDGMENTCC 227/2022 OF JUDICIAL FIRST CLASS
MAGIST. COURT, CHOTTANIKKARA(TEMPORARY) DATED 17.05.2022
PETITIONER/ACCUSED:
1 EUROTECH POLYMERS
PARAKKULAM, ANAKKARA P.O., PALAKKAD DISTRICT-
679551 REPRESENTED BY ITS MANAGING PARTNER ABDUL
RASHEED, PIN - 679551
2 ABDUL RASHEED M.C.,AGED 52 YEARS
S/O UMMAR, MANIKULATHIL HOUSE, KALATHILPADI,
ERAMANGALAM P.O., VELIYANKODE, MALAPPURAM
DISTRICT- 679587 MANAGING PARTNER, M/S EUROTECH
POLYMERS, PARAKKULAM, ANAKKARA P.O., PALAKKAD
DISTRICT, PIN - 679587
BY ADVS.ANAND KALYANAKRISHNAN
C.DHEERAJ RAJAN
RESPONDENTS/STATE & DEFACTO COMPLAINANT:
1 STATE OF KERALA
REPRESENTED BY PUBLIC PROSECUTOR,HIGH COURT OF
KERALA, PIN - 682031
2 BABU C.Y.,AGED 58 YEARS
S/O YOHANNAN, CHAMAKKALAYIL HOUSE, KANAYANNUR,
CHOTTANIKKARA P.O., ERNAKULAM, PIN - 682312
THIS CRIMINAL MISC. CASE HAVING COME UP FOR ADMISSION ON
21.10.2022, ALONG WITH Crl.MC.5043/2022 AND CONNECTED CASES, THE
COURT ON THE SAME DAY PASSED THE FOLLOWING:
Crl.M.C. Nos. 5043, 5045 & 5046 of 2022
-:3:-
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MRS. JUSTICE MARY JOSEPH
FRIDAY, THE 21ST DAY OF OCTOBER 2022 / 29TH ASWINA, 1944
CRL.MC NO. 5046 OF 2022
AGAINST THE ORDER/JUDGMENTCC 898/2021 OF JUDICIAL FIRST CLASS
MAGIST. COURT, CHOTTANIKKARA(TEMPORARY) DATED 17.05.2022
PETITIONER/ACCUSED:
1 EUROTECH POLYMERS
PARAKKULAM, ANAKKARA P.O., PALAKKAD DISTRICT-
679551 REPRESENTED BY ITS MANAGING PARTNER ABDUL
RASHEED, PIN - 679551
2 ABDUL RASHEED M.C.,AGED 52 YEARS
S/O UMMAR, MANIKULATHIL HOUSE, KALATHILPADI,
ERAMANGALAM P.O., VELIYANKODE, MALAPPURAM
DISTRICT- 679587 MANAGING PARTNER, M/S EUROTECH
POLYMERS, PARAKKULAM, ANAKKARA P.O., PALAKKAD
DISTRICT, PIN - 679587
BY ADVS.ANAND KALYANAKRISHNAN
C.DHEERAJ RAJAN
RESPONDENTS/STATE & DEFACTO COMPLAINANT:
1 STATE OF KERALA
REPRESENTED BY PUBLIC PROSECUTOR,HIGH COURT OF
KERALA, PIN - 682031
2 BABU. C.Y.,AGED 58 YEARS
S/O YOHANNAN, CHAMAKKALAYIL HOUSE, KANAYANNUR,
CHOTTANIKKARA P.O., ERNAKULAM, PIN - 682312
THIS CRIMINAL MISC. CASE HAVING COME UP FOR
ADMISSION ON 21.10.2022, ALONG WITH Crl.MC.5043/2022
AND CONNECTED CASES, THE COURT ON THE SAME DAY PASSED
THE FOLLOWING:
Crl.M.C. Nos. 5043, 5045 & 5046 of 2022
-:4:-
MARY JOSEPH, J.
---------------------------
Crl.M.C. Nos. 5043, 5045 & 5046 of 2022
---------------------------
Dated this the 21st day of October, 2022
ORDER
Petitioners are accused in CC No.898/2021, 226/2022 and
227/2022 filed for prosecuting the accused for an offence under
Section 138 of the Negotiable Instruments Act, 1881 (for short
'N.I. Act'). Allegation was that cheques issued towards payment
of cost of materials purchased were dishonoured for the reason,
want of sufficient funds. In all cases the complaints have been
taken on file after recording the sworn statement of the
complainant and process was issued to the accused. On process
being served, the accused entered appearance. Particulars of
the offences alleged were read over and explained to the
respective accused in the prosecutions. They pleaded not guilty.
On an oral request made by the complainant before the court
below, orders were passed. Copy of the proceedings containing
Crl.M.C. Nos. 5043, 5045 & 5046 of 2022
the relevant orders are incorporated alongwith the petitions on
hand as Annexure 2. Order dated 17.05.2022 is under
challenge.
2. The impugned orders read :
"Complainant absent represented. Summons served to
accused. Accused present represented. Sureties present.
Accused enlarged on bail. Vakkalath already filed and copy
already served. Particulars of offence read over and explained to
accused to which he pleaded not guilty. Learned counsel for
complainant submitted to invoke S.143A NI Act. Hence as per
Section 143A NI Act, the accused is directed to pay 20
percentage of the amount of the cheque as interim
compensation to the complainant. For payment of interim
compensation 18.07.2022."
3. The impugned orders were passed by the court below in
prosecutions numbered as above, launched by the 2 nd respondent
herein under Section 138 of the Negotiable Instruments Act,
1881 (for short 'N.I. Act'). The allegation in the complaints was
that the cheques drawn and issued by the 1 st petitioner in favour
of the 2nd respondent were dishonoured for want of sufficient
funds. According to the 2nd respondent, the petitioner is an
establishment dealing with manufacture, marketing, sale and
Crl.M.C. Nos. 5043, 5045 & 5046 of 2022
distribution of "Hanbaz water tank cleaner" and an agreement
was entered into with the 2nd respondent on 04.04.2019 for the
distributionship of the above said product and for the sale, a sum
of Rs.10,50,000/- was received by the 2 nd petitioner from the 2nd
respondent in two instalments through bank transfer. The case
of the 2nd respondent was that most of the delivered units of the
water tank cleaner were faulty. The first batch of materials being
defective, the 2nd respondent informed the 2nd petitioner about
his unwillingness to continue with the business. Thereupon the
2nd petitioner executed and handed over cheques drawn on State
Bank of India for different sums towards the costs of materials
undelivered. Cheques were presented for collection but,
dishonoured for want of sufficient funds. The factum of
dishonour of the cheques was intimated to the 2nd petitioner who
had agreed to pay back the entire amount after deducting the
value of the materials already sold out by the 2 nd respondent.
Dishonoured cheques were returned to the 2 nd petitioner. The
matter was settled for an amount of Rs.8,59,325/- and the
petitioner has undertaken to pay it to the 2 nd respondent. The
Crl.M.C. Nos. 5043, 5045 & 5046 of 2022
complaints were taken on file after recording the sworn
statement of the 2nd respondent in each case. Accused entered
appearance on receipt of summons and enlarged on bail in each
cases. Particulars of the offences alleged were read over and
explained to him and he pleaded not guilty.
4. Thereupon the learned counsel for the complainant urged
to invoke Section 143A N.I. Act. The court below directed the
accused to pay 20% of the amount covered by the cheques as
interim compensation to the complainant and posted for payment
of the same to 18.07.2022. The petitioner/accused was
aggrieved by the order issued as above and accordingly seeks to
quash the same for reasons stated hereinbelow.
5. According to the learned counsel, Section 143A
empowers the court to pass an order against the accused
directing him to pay interim compensation to the complainant,
which shall not exceed 20% of the cheque amount. According to
him, the word used in the provision being 'may' and in view of
the direction it incorporates that compensation to be paid shall
not exceed 20% of the cheque amount, the power conferred on
Crl.M.C. Nos. 5043, 5045 & 5046 of 2022
the court below can only be taken as discretionary. According to
him, the power being discretionary, the court below is bound to
state the reasons while directing deposit of interim
compensation. Moreover, it is submitted by the learned counsel
that the direction to pay interim compensation under Section
143A N.I. Act can only be issued on an application filed by the
complainant seeking for that. According to the learned counsel,
in the case on hand, no such application was filed by the
complainant but an oral submission alone was made. According
to him, as per Section 143A the maximum amount to be paid as
interim compensation is 20% of the amount covered by the
cheque. Therefore, the court below shall exercise discretion
while fixing the quantum ordered to be paid as interim
compensation. According to him,the sum directed to be paid can
be a sum equivalent to 20% or below that.
6. According to the learned counsel, the impugned order is
a cryptic one and it directs deposit of 20% of the cheque amount
as interim compensation. The impugned order does not contain
Crl.M.C. Nos. 5043, 5045 & 5046 of 2022
reasons for issuance of the direction. Accordingly the learned
counsel canvassed for setting aside the impugned order.
7. Section 143A N.I. Act is extracted hereunder :
"143A. Power to direct interim compensation
(1) Notwithstanding anything contained in the Code
of Criminal Procedure, 1973, the Court trying an offence under
section 138 may order the drawer of the cheque to pay interim
compensation to the complainant--
(a) in a summary trial or a summons case, where he
pleads not guilty to the accusation made in the complaint; and
(b) in any other case, upon framing of charge.
(2) The interim compensation under sub-section (1) shall
not exceed twenty
per cent. of the amount of the cheque.
(3) The interim compensation shall be paid within sixty
days from the date of the order under sub-section (1), or within
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.
Crl.M.C. Nos. 5043, 5045 & 5046 of 2022
(5) The interim compensation payable under this section
may be recovered as if it were a fine under section 421 of the
Code of Criminal Procedure, 1973.
(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, shall be reduced by the amount
paid or recovered as interim compensation under this section."
Section starts with a non-obstante clause. It provides that
a court in seizin of a complaint filed to prosecute an offender
under Section 138 N.I. Act may order the drawer of the cheque
to pay interim compensation to the complainant in a summary
trial or summons case, when he pleads not guilty to the
accusations made in the complaint. Sub-section (2) provides
that interim compensation under sub-Section (1) shall not exceed
20% of the amount covered by the cheque. Sub-section (3)
provides that interim compensation shall be paid within 60 days
from the date of the order or within such further period, not
exceeding 30 days as directed by the court on sufficient cause
being shown by the drawer of the cheque. Though the word
'may' is incorporated in the provision, when viewed in the
backdrop of the objects and reasons of the Negotiable
Crl.M.C. Nos. 5043, 5045 & 5046 of 2022
Instruments (Amendment) Act, 2018, the meaning 'shall' is
required to be assigned to it. As per the provision, the court is
empowered to direct payment of interim compensation in all
prosecutions under Section 138 N.I. Act filed after the
introduction of the provision.
8. The Section does not contemplate filing of an application
under the provision for getting interim compensation. It can be
ordered either on application being filed by the complainant or
suo motu by the court. It is provided under the provision that in
a summary trial or a Summons Trial Case, the right time for
invocation of the provision is after making a plea of not guilty to
the accusations made in the complaint. A prosecution under
Section 138 N.I. Act being a summons trial, a direction to pay
interim compensation can be issued immediately when the
accusations are read over to the accused and himself making a
plea that he is not guilty of those.
9. In the case on hand, the impugned orders directing to
pay 20% of the amount covered by the cheques were passed by
the court below, immediately after appearance of the accused
Crl.M.C. Nos. 5043, 5045 & 5046 of 2022
and making a plea that he is not guilty of the offence alleged
against him. The direction of the court below was to deposit
20% of the amount covered by each of the cheques. Section
143A empowers a court of law to direct deposit of a sum to the
maximum of 20% of the cheque amount as interim
compensation.
10. The third ground of argument was that the reasons for
issuing direction to deposit 20% of the cheque amount, was not
furnished by the court in the impugned orders. Section 143A
does not say anything about recording of reasons while directing
deposit of 20% or below 20% of cheque amount towards interim
compensation.
In view of the above discussion, this Court has no hesitation
to hold that the challenge made against the impugned orders is
untenable being devoid of merits. The impugned orders are legal,
proper and correct and therefore interference is uncalled for.
Crl.M.Cs fail for the reasons and are dismissed.
Sd/-
MARY JOSEPH,
JUDGE.
Ttb
Crl.M.C. Nos. 5043, 5045 & 5046 of 2022
APPENDIX OF CRL.MC 5043/2022
PETITIONERS' ANNEXURES :
Annexure1 THE TRUE COPY OF THE COMPLAINT DATED
01.01.2022 IN CC NO. 226/2022 ON THE
FILES OF JUDICIAL FIRST CLASS MAGISTRATE
COURT, CHOTTANIKKARA
Annexure2 THE CERTIFIED COPY OF THE PROCEEDINGS
DATED 17.05.2022 IN CC NO. 226/2022 ON
THE FILES OF JUDICIAL FIRST CLASS
MAGISTRATE COURT, CHOTTANIKKARA
Crl.M.C. Nos. 5043, 5045 & 5046 of 2022
APPENDIX OF CRL.MC 5045/2022
PETITIONERS' ANNEXURES :
Annexure1 THE TRUE COPY OF THE COMPLAINT DATED
01.01.2022 IN CC NO. 227/2022 ON THE
FILES OF JUDICIAL FIRST CLASS MAGISTRATE
COURT, CHOTTANIKKARA
Annexure2 THE CERTIFIED COPY OF THE PROCEEDINGS
DATED 17.05.2022 IN CC NO. 227/2022 ON
THE FILES OF JUDICIAL FIRST CLASS
MAGISTRATE COURT, CHOTTANIKKARA
Crl.M.C. Nos. 5043, 5045 & 5046 of 2022
APPENDIX OF CRL.MC 5046/2022
PETITIONERS' ANNEXURES :
Annexure1 THE TRUE COPY OF THE COMPLAINT DATED
15.04.2021 IN CC NO. 898/2021 ON THE
FILES OF JUDICIAL FIRST CLASS MAGISTRATE
COURT, CHOTTANIKKARA
Annexure2 THE CERTIFIED COPY OF THE PROCEEDINGS
DATED 17.05.2022 IN CC NO. 898/2021 ON
THE FILES OF JUDICIAL FIRST CLASS
MAGISTRATE COURT, CHOTTANIKKARA
