October 5,2017:
Read here Landmark Judgement which allows the Criminal Courts to drop Cases on mere payment of Cheque amount despite Complainant not agreeing.
The Supreme Court has clarified that an accused in a case under Section 138 of Negotiable Instruments Act can be discharged even without the consent of the complainant, if the Court is satisfied that the complainant has been duly compensated.
It was also held that the normal role of criminal law that composition of offence is possible only with the consent of complainant/victim is not applicable for cases under Sec.138 of NI Act.
This was because the offence under Section 138 was ‘primarily a civil wrong’.
Therefore, the power under Section 258 of the Code of Criminal Procedure to stop trial and discharge the accused was available to the Magistrate even though the summary trial under Chapter XXI of Cr.P.C.
The bench consisting of Justices Adarsh Kumar Goel and Uday Umesh Lalit was dealing with the prayer of a person for compounding the offence or in the alternative for exempting from personal appearance.
Though the appellant was ready to pay the cheque amount along with interest and costs and thereby to compound the matter, the complainant did not consent to it and therefore the Magistrate proceeded with the matter without exempting personal appearance.
The High Court refused to provide relief citing a 2012 SC Caselaw and held that consent of the complainant was necessary for compounding the offence.
In cheque bounce cases court can discharge the accused.
The Supreme Court has used the expression “so far as may be” available in Section-143 NI Act in a manner that though the concept of dropping of proceeding in Section-258 CrPC applies only to police cases of summons nature, the same can be made applicable to Section-143 NI Act also as the summons procedure has to be applied only so far as may be applicable and therefore, there may be deviation made in the summons procedure available in CrPC. Consequently, the proceeding may be dropped.
The Supreme Court observed “Thus, Section 258 Cr.P.C. which enables proceedings to be stopped in a summons case, even though strictly speaking is not applicable to complaint cases, since the provisions of the Cr.P.C. are applicable “so far as may be”, the principle of the said provision is applicable to a complaint case covered by Section 143 of the Act which contemplates applicability of summary trial provisions, as far as possible, i.e. with such deviation as may be necessary for speedy trial in the context”.
The Supreme Court also distinguished the earlier judgment given in Subramanium Sethuraman versus State of Maharashtra by observing as “this Court observed that once the plea of the accused is recorded under Section 252 of the Cr.P.C., the procedure contemplated under Chapter XX of the Cr.P.C. has to be followed to take the trial to its logical conclusion, the said judgment was rendered as per statutory provisions prior to 2002 amendment. The statutory scheme post 2002 amendment as considered in Mandvi Cooperative Bank and J.V. Baharuni (supra) has brought about a change in law and it needs to be recognised”.
On a first reading of the judgment it may appear that it is concerned only with a facet when the accused compensate the complainant. A closure reading however will show that once Section-258 is made applicable to Section-143 NI Act by explaining the expression “so far as may be” the same will apply to every situation and compensating scenario can be treated as one facet of it and as such, dropping of proceeding will be done in other desirable cases also on legal & factual points. Consequence of dropping of proceedings as is well known will be release of accused amounting to his discharge.
Supreme Court in the judgment has passed following directions:
i) Offence under Section 138 of the Act is primarily a 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 258 Cr.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.
ii) 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.
iii) 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.
iv) 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 IPC and with further powers of recovery under Section 431 Cr.P.C. With this approach, prison sentence of more than one year may not be required in all cases.
v) 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 264 Cr.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.
Supreme Court has also advised the High Courts to issue updated directions for speedy disposal in accordance with the judgments already pronounced.
This judgment will certainly help in disposal of cases and also in early settlement of commercial disputes arising out of bouncing of cheques.
SC Judgement on Speedy Disposal of Cheque Bounce Cases by Latest Laws Team on Scribd
Related News @ Latest Laws-
3.11.2016 - Mediation in Cheque Dishonour Cases: Legality and Binding effect by Bharat Chugh
30.3.2016 - Law Commission Report No. 213- Fast Track Magisterial Courts for Dishonoured Cheque Cases
23.2.2016 - Legendary actor Dilip Kumar acquitted in the 18-year-old cheque bounce case
18.9.2015 - Even though dishonoured Cheque was for Security purpose, there is no escape from Criminal Liability
7.6.2015 - Dishonour of Cheque
Share this Document :Picture Source :
