Himachal Pradesh High Court
Sunil Kumar vs M/S Anand Automobile And Anr on 8 April, 2024
IN THE HIGH COURT OF HIMACHAL PRADESH
AT SHIMLA
Cr. Revision No. 204 of 2024
Decided on: 8th April, 2024
___________________________________________________________
.
Sunil Kumar .......Petitioner
Versus
M/s Anand Automobile and Anr. ......Respondents
Coram
Hon'ble Mr. Justice Ranjan Sharma, Judge
1 Whether approved for reporting? Yes
For the petitioner:
r Mr. Amit Sharma, Advocate.
For the respondents: Mr. Anubhav Chopra, Advocate, for
respondent No.1.
Mr. Prashant Sen, Deputy Advocate
General for- respondent No.2-State.
Ranjan Sharma, Judge (Oral)
Cr.MP(M) No. 628 of 2024 This is an application under Section 5 of Limitations Act, praying for condonation of 1 year 7 months and 26 days, of delay in filing the accompany Criminal Revision Petition. Para 2 of the application narrate the sequel of events, leading to the aforesaid delay, 1 Whether reporters of Local Papers may be allowed to see the judgment?
::: Downloaded on - 12/04/2024 20:38:23 :::CIS -2-as the petitioner-accused could not arrange the amount due to financial stringency. The reasons mentioned in the application, explaining the delay, appear to be bonafide .
and unintentional.
2. On issuance of notice on this application on 3.4.2024, Mr. Anubhav Chopra, Advocate, has put in appearance on behalf of Respondent No.1 [M/s Anand Automobile NH-20 Bodh, Tehsil Nurpur, District Kangra, H.P]. r Mr. Anubhav Chopra, Advocate, on instructions, at the very outset submits that the Respondent No.1- Complainant/non-applicant does not intend to pursue the matter/proceedings under Section 138 of the Negotiable Instruments Act and states that he has no objection to the aforesaid application.
3. Moreover, since respondent No.2-State is a formal party-respondent in the instant proceedings, originating under the statute i.e. Negotiable Instruments Act, 1881 [hereinafter referred to as 'Act'] therefore, the respondent No.2 not file any reply or objection to the said ::: Downloaded on - 12/04/2024 20:38:23 :::CIS -3- application. The application stands disposed of.
4. In these circumstances, the instant application i.e. Cr.MP(M) No. 628 of 2024, is allowed and the delay .
of 1 year 7 months and 26 days is condoned.
Cr.MP No. 1173 of 20245. This is an application by the petitioner-accused [Sunil Kumar] under Section 482 Cr.P.C. praying for quashing the impugned judgment dated 27.11.2018 passed by the Learned Trial Court which was, affirmed by the Learned Appellate Court 08.07.2022, that the matter has been settled with the Respondent No.1-Complainnat [as per Paras No.3 and 5 of application] just to maintain good relations inter se the parties.
On listing of the case today, on 8th April, 2024, Mr. Anubhav Chopra, learned counsel for Respondent No.1-Complainnt, on instructions, does not dispute this position and confirms that the matter has been amicably resolved.
6. In these circumstances, the instant application i.e. Cr.MP No.1173 of 2024 is allowed.
::: Downloaded on - 12/04/2024 20:38:23 :::CIS -4- Cr.MP No. 1153 of 20247. On 06.04.2024, the Respondent No.1- Complainant/applicant-[M/s Anand Automobile NH-20 .
Bodh, Tehsil Nurpur, District Kangra, H.P.] has filed two applications, which were under Section 482 Cr.PC and Section 147 of the Negotiable Instruments Act, which was taken up today [on 8th April, 2024]. In Paras 3 to 5 of the application, it was stated that the Respondent-
Complainant has received entire payment and has decided to amicably settle the matter and nothing is now due/recoverable from the petitioner-accused. It is further averred in Paras 5 and 6 of the application, that the matter has been amicably resolved just to keep good relations between the petitioner and Respondent No.1, and accordingly the prayer for quashing the judgment(s) passed by the Learned Trial Court dated 27.11.2018, which was affirmed by the learned Appellate Court on 8.7.2022 has been made.
Cr. Revision No. 204 of 20248. The petitioner-accused [Sunil Kumar] has filed ::: Downloaded on - 12/04/2024 20:38:23 :::CIS -5- the instant Criminal Revision Petition under Section 397 read with Section 401 of the Code of Criminal Procedure;
assailing the judgment of conviction and sentence dated .
27.11.2018 passed by the Learned Judicial Magistrate First Class, Court No.II, Nurpur, District Kangra, (HP), [hereinafter referred to as 'Trial Court'] whereby, the petitioner-accused [Sunil Kumar] was imposed simple imprisonment for six months for offence punishable under Section 138 of the Negotiable Instruments Act and to pay compensation of Rs 6,00,000/- [Rupees Six Lakh] [cheque amount and compensation thereon]; which stands affirmed on 08.07.2022 by the Learned Additional Sessions Judge (I), Kangra at Dharamshala, Circuit Court at Nurpur, (HP) [hereinafter referred to as 'Appellate Court], in Criminal Appeal No.12-N/X/2018.
9. Now, during of the Criminal Revision Petitioner, the petitioner-accused [Sunil Kumar] has filed a Cr.MP No.1173 of 2024, as referred to above, stating that since the matter has been resolved, therefore, the mater may be compounded and the impugned Judgments may be ::: Downloaded on - 12/04/2024 20:38:23 :::CIS -6- quashed. This prayer is not disputed by Mr. Anubhav Chopra, learned counsel for Respondent No.1- Complainant, on instructions, who confirms that the .
matter has been settled and the impugned Judgments may be compounded/quashed. Likewise, the Respondent No.1- Complainant [M/s Anand Automobile, NH-20 Bodh, Tehsil Nurpur, District Kangra] has filed a Cr.MP No.1153 of 2024 confirming the averments made by petitioner-accused in Cr.MP No.1173 of 2024 and stating in Para 3 that the cheque amount has been received by the Respondent No.1- Complainant. In this background, it is prayed that the offence may be compounded and the impugned Judgments may be quashed and set-aside.
10. Heard Mr. Amit Sharma, Learned Counsel for the petitioner, Mr. Anubhav Chopra, Learned Counsel for Respondent No.1 and Mr. Prashant Sen, Learned Deputy Advocate General, for Respondent No.2.
11. In order to appreciate the controversy involved in the instant case, it is relevant to have a recap of the statutory provisions i.e. Sections 138 and 147 of the ::: Downloaded on - 12/04/2024 20:38:23 :::CIS -7- Negotiable Instruments Act, which read as under:-
"138. Dishonour of cheque for insufficiency, etc., of funds in the account. --
Where any cheque drawn by a person on an .
account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an ragreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provision of this Act, be punished with imprisonment for 4 [a term which may be extended to two years'], or with fine which may extend to twice the amount of the cheque, or with both:
Provided that nothing contained in this section shall apply unless --
(a) the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier;
(b) the payee or the holder in due course of the cheque, as the case may be, makes a ::: Downloaded on - 12/04/2024 20:38:23 :::CIS -8- demand for the payment of the said amount of money by giving a notice; in writing, to the drawer of the cheque, 5 [within thirty days] of the receipt of .
information by him from the bank regarding the return of the cheque as unpaid; and
(c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice.
Explanation. -- For the purposes of this section, r "debt of other liability" means a legally enforceable debt or other liability.
147. Offences to be compoundable. --
Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), every offence punishable under this Act shall be compoundable]."
12. In the backdrop of the statutory provisions, since the instant petition has been filed under Section 482 of the Code of Criminal Procedure, therefore, it is necessary to have a look at the relevant provisions of Section 482 of the Code of Criminal Procedure, which reads as under:-
"482. Saving of inherent power of High Court. -::: Downloaded on - 12/04/2024 20:38:23 :::CIS -9-
Nothing in this Code shall be deemed to limit or affect the inherent powers of the High Court to make such orders as may be necessary to give effect to any order under this Code, or to prevent abuse of the process of any Court or otherwise to secure the ends .
of justice."
12(i). In the background of the aforesaid statutory provisions, it is relevant to take note of the mandate of the Hon'ble Supreme Court, in Meters and Instruments Private Limited and another Versus Kanchan Mehta, (2018) 1 SCC 560 has also held as under:-
"6. The object of introducing Section 138 and other provisions of Chapter XVII in the Act in the year 1988 [Vide the Banking, Public Financial Institutions and Negotiable Instruments Laws (Amendment) Act, 1988] was to enhance the acceptability of cheques in the settlement of liabilities. The drawer of cheque is made liable to prosecution on dishonour of cheque with safeguards to prevent harassment of honest drawers. The Negotiable Instruments (Amendment and Miscellaneous Provisions) Act, 2002 to amend the Act was brought in, inter alia, to simplify the procedure to deal with such matters. The amendment includes provision for service of summons ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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by speed post/courier, summary trial and making the offence compoundable.
7. This Court has noted that the object of the statute was to facilitate smooth functioning of business .
transactions. The provision is necessary as in many transactions cheques were issued merely as a device to defraud the creditors. Dishonour of cheque causes incalculable loss, injury and inconvenience to the payee and credibility of business transactions suffers a setback. [Goaplast (P) Ltd. v. Chico Ursula D'Souza, (2004) 2 SCC 235 : 2004 SCC (Cri) 499].
r At the same time, it was also noted that nature of offence under Section 138 primarily related to a civil wrong and the 2002 Amendment specifically made it compoundable. [Vinay Devanna Nayak v. Ryot Sewa Sahakari Bank Ltd., (2008) 2 SCC 305 : (2008) 1 SCC (Civ) 542 :
(2008) 1 SCC (Cri) 351] The offence was also described as "regulatory offence". The burden of proof was on the accused in view of presumption under Section 139 and the standard of proof was of "preponderance of probabilities". [Rangappa v. Sri Mohan, (2010) 11 SCC 441 : (2010) 4 SCC (Civ) 477 : (2011) 1 SCC (Cri) 184].
The object of the provision was described as both punitive as well as compensatory. The intention of the provision was to ensure that the complainant received the amount of cheque by way of compensation. Though proceedings under Section 138 could not be treated as civil suits for recovery, the ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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scheme of the provision, providing for punishment with imprisonment or with fine which could extend to twice the amount of the cheque or to both, made the intention of law clear. The complainant could be given not only the cheque amount but double .
the amount so as to cover interest and costs.
Section 357(1)(b) CrPC provides for payment of compensation for the loss caused by the offence out of the fine. [R. Vijayan v. Baby, (2012) 1 SCC 260 : (2012) 1 SCC (Civ) 79 : (2012) 1 SCC (Cri) 520]. Where fine is not imposed, compensation can be awarded under Section 357(3) CrPC to the person who suffered loss. Sentence in default can also be imposed. The object of the provision is not merely penal but to make the accused honour the negotiable r instruments.
18. From the above discussion the following aspects emerge:
18.1. Offence under Section 138 of the Act is primarily a civil wrong. Burden of proof is on the accused in view of 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 Cr.PC but with such variation as may be appropriate to proceedings under Chapter XVII of the Act. Thus read, principle of Section 258 CrPC 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.::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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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) CrPC to award suitable compensation with default sentence under Section 64 IPC and with further powers of recovery under Section 431 CrPC. 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 ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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person giving affidavit and examining him and the bank's slip being prima facie evidence of the dishonour 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.PC. 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 r the accused or any other circumstances.
19. In view of the above, we hold that where the cheque amount with interest and cost as assessed by the Court is paid by a specified date, the Court is entitled to close the proceedings in exercise of its powers under Section 143 of the Act read with Section 258 Cr.P.C. As already observed, normal rule for trial of cases under Chapter XVII of the Act is to follow the summary procedure and summons trial procedure can be followed where sentence exceeding one year may be necessary taking into account the fact that compensation under Section 357(3) Cr.P.C. with sentence of less than one year will not be adequate, having regard to the amount of cheque, conduct of the accused and other circumstances.
20. In every complaint under Section 138 of the Act, it ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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may be desirable that the complainant gives his bank account number and if possible e-mail ID of the accused. If e-mail ID is available with the Bank where the accused has an account, such Bank, on being required, should furnish such e-mail ID to .
the payee of the cheque. In every summons, issued to the accused, it may be indicated that if the accused deposits the specified amount, which should be assessed by the Court having regard to the cheque amount and interest/cost, by a specified date, the accused need not appear unless required and proceedings may be closed subject to any valid objection of the complainant . If the accused complies with such summons and informs the Court and the complainant by e-mail, the Court can ascertain the objection, if any, of the complainant and close the proceedings unless it becomes necessary to proceed with the case. In such a situation, the accused's presence can be required, unless the presence is otherwise exempted subject to such conditions as may be considered appropriate. The accused, who wants to contest the case, must be required to disclose specific defence for such contest. It is open to the Court to ask specific questions to the accused at that stage. In case the trial is to proceed, it will be open to the Court to explore the possibility of settlement. It will also be open to the Court to consider the provisions of plea bargaining. Subject to this, the trial can be on day to day basis and endeavour must be to conclude it within six months. The guilty must be punished at the earliest as per law and the one who obeys the law ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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need not be held up in proceedings for long unnecessarily."
65. In a recent judgment in M. Abbas Haji v. T.N. Channakeshava, (2019) 9 SCC 606, this Court .
held:
"6. It is urged before us that the High Court overstepped the limits which the appellate court is bound by criminal cases setting aside an order of acquittal. Proceedings under Section 138 of the Act are quasi- criminal proceedings. The principles, which apply to acquittal in other criminal cases, cannot apply to these cases.
66. r Likewise, in H.N. Jagadeesh v. R. Rajeshwari, (2019) 16 SCC 730, this Court again alluded to the quasi-criminal nature of the offence as follows:
"7. The learned counsel for the respondent has submitted that in order to advance the cause of justice, such an approach is permissible and for this purpose he has relied upon the judgment of this Court in Zahira Habibulla H. Sheikh v. State of Gujarat. We are afraid that the ratio of the aforesaid judgment cannot be extended to the facts of this case, particularly when we find that the present case is a complaint case filed by the respondent under Section 138 of the Act and where the proceedings are also quasi-criminal nature".::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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67. A conspectus of these judgments would show that the gravamen of a proceeding under Section 138, though couched in language making the act complained of an .
offence, is really in order to get back through a summary proceeding, the amount contained in the dishonoured cheque together with interest and costs, expeditiously and cheaply. We have already seen how it is the victim alone who can file the complaint which ordinarily culminates in the payment of fine as compensation which may extend to twice the amount of the cheque which would include the amount of the cheque and the interest and costs thereupon. Given our analysis of Chapter XVII of the Negotiable Instruments Act together with the amendments made thereto and the case law cited hereinabove, it is clear that a quasi- criminal proceeding that is contained in Chapter XVII of the Negotiable Instruments Act would, given the object and context of Section 14 of the IBC, amount to a "proceeding" within the meaning of Section 14(1)(a), the moratorium therefore attaching to such proceeding.
12(ii). Likewise in Madan Tiwari versus Yashwant Kumar Sahu and Another, 2020 SCC Online 1310, the Hon'ble Apex Court, has quashed the judgments of conviction and sentence in a case where the parties had arrived at a settlement under the provisions of the ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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Negotiable Instruments Act. The relevant Paras of the aforesaid judgment read as under:-
"7. Now, the applicant-appellant has filed an application being Criminal Misc. Petition No. 176956 of 2019 .
seeking modification of the Order dated 27.09.2019 stating therein that the matter has been compromised between the parties. The appellant as per Settlement Agreement dated 05.09.2019 made payment of entire sum of Rs.3,16,000/- to respondent No. 1-complainant. It has further been stated in the said application that respondent No. 1- complainant on his own after having been received a sum of Rs. 3,16,000/- along with Rs. 50,000/-, as interest, from the appellant, filed an application runder Section 147 of the Negotiable Instruments Act, 1881, for compounding of offence before the Chief Judicial Magistrate, 1st Class, Durg, Chhattisgarh.
8. It has been averred in the above-mentioned application that when the Order dated 27.09.2019 was passed by this Court, the appellant had already paid Rs.3,16,000/- to respondent No. 1-complainant, vide Settlement Agreement dated 05.09.2019, along with interest amounting to Rs.50,000/- and respondent No. 1 is completely satisfied with the amount received, which he has received wilfully, and he does not wish to continue the proceedings further.
9. Respondent No. 1-complainant has also filed an affidavit dated 08.11.2019 stating therein that he does not want to pursue the litigation further qua the appellant, since the matter has been amicably ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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settled between the parties vide Settlement Agreement dated 5.09.2019. It has further been stated in the affidavit that he has received an amount of Rs.3,16,000/- along with interest of Rs.50,000/- from the appellant and he has no .
further claim against the appellant. It has also been stated in the said affidavit that respondent No. 1 has entered into the agreement with the appellant out of his own free will and without any coercion or undue pressure from the appellant.
10. Having perused the averments made in Criminal Misc. Petition No. 176956 of 2019 filed by the applicant-appellant, as also the statement made by respondent No. 1-complainant in the affidavit dated 08.11.2019, more particularly keeping in view the settlement arrived at between the parties, we hereby allow the application(s) and set aside the conviction and sentence of two years' rigorous imprisonment with fine of Rs.5,000/- awarded to the appellant under Section 138 of the Negotiable Instruments Act, 1881 by the trial court as affirmed by the appellate court and the High Court."
12(iii). The Hon'ble Apex Court while dealing with the object of the scope of Section 138 and the provision of compounding in Section 147 of the Negotiable Instruments Act, has held as under in (2021) 6 Supreme Court Cases 258, titled as P. Mohanraj and Others versus Shah Brothers Ispat Private Limited. The Hon'ble Apex Court ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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has discussed the scope of Section 138 of the Negotiable Instruments Act Section 147, regarding compounding of offence, under the aforesaid Act, in the following terms:
.
"53. A perusal of this judgment in Ishwarlal Bhagwandas would show that a civil proceeding is not necessarily a proceeding which begins with the filing of a suit and culminates in execution of a decree. It would include a revenue proceeding as well as a writ petition filed under Article 226 of the Constitution, if the reliefs therein are to enforce rights of a civil nature. Interestingly, criminal proceedings are stated to be proceedings in which the larger interest of the State is concerned. Given these tests, it is clear that r a Section 138 proceeding can be said to be a "civil sheep" in a "criminal wolf's" clothing, as it is the interest of the victim that is sought to be protected, the larger interest of the State being subsumed in the victim alone moving a court in cheque bouncing cases, as has been seen by us in the analysis made hereinabove of Chapter XVII of the Negotiable Instruments Act.
54. In Goaplast (P) Ltd. v. Chico Ursula D'Souza, the object sought to be achieved by Section 138 is succinctly set out in paragraph 3 thereof:
"3. The learned counsel for the appellant has submitted that mere writing of letter to the bank stopping payment of the post-dated cheques does not take the case out of the purview of the Act. He has invited our attention to the object behind the provision contained in Chapter XVII ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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of the Act. For appreciating the issue involved in the present case, it is necessary to refer to the object behind introduction of Chapter XVII containing Sections 138 to 142. This chapter was introduced in the Act by the Banking, Public .
Financial Institutions and Negotiable Instruments Laws (Amendment) Act, 1988 (Act 66 of 1988) with the object of inculcating faith in the efficacy of banking operations and giving credibility to negotiable instruments in business transactions and in order to promote efficacy of banking operations. With the policy of liberalisation adopted by the country which brought about increase in international trade and commerce, it became necessary to inculcate faith in banking. World trade is carried through banking operations rather than cash transactions. The amendment was intended to create an atmosphere of faith and reliance on banking system. Therefore, while considering the question of applicability of Section 138 of the Act to a situation presented by the facts of the present case, it is necessary to keep the objects of the legislation in mind. If a party is allowed to use a cheque as a mode of deferred payment and the payee of the cheque on the faith that he will get his payment on the due date accepts such deferred payment by way of cheque, he should not normally suffer on account of non-payment. The faith, which the legislature has desired that such instruments should inspire in commercial transactions would be completely lost if parties are as a matter of routine allowed to interdict ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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payment by issuing instruction to banks to stop payment of cheques. In today's world where use of cash in day-to-day life is almost getting extinct and people are using negotiable instruments in commercial transactions and plastic money for .
their daily needs as consumers, it is all the more necessary that people's faith in such instruments should be strengthened rather than weakened. Provisions contained in Sections 138 to 142 of the Act are intended to discourage people from not honouring their commitments by way of payment through cheques. It is desirable that the court should lean in favour of an interpretation which serves the object of the statute. The penal provisions contained in Sections 138 to 142 of the Act are intended to ensure that obligations undertaken by issuing cheques as a mode of payment are honoured. A post-dated cheque will lose its credibility and acceptability if its payment can be stopped routinely. A cheque is a well-recognized mode of payment and post-dated cheques are often used in various transactions in daily life. The purpose of a post-dated cheque is to provide some accommodation to the drawer of the cheque. Therefore, it is all the more necessary that the drawer of the cheque should not be allowed to abuse the accommodation given to him by a creditor by way of acceptance of a post- dated cheque. If stoppage of payment of a post- dated cheque is permitted to take the case out of the purview of Section 138 of the Act, it will amount to allowing the party to take advantage ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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of his own wrong."
55. In Vinay Devanna Nayak v. Ryot Sewa Sahakari Bank Ltd., a Division Bench of this Court referred to the object of Section 138 thus:
.
"16. Section 138 of the Act was inserted by the Banking, Public Financial Institutions and Negotiable Instruments Law (Amendment) Act, 1988 (Act 66 of 1988) to regulate financial promises in growing business, trade, commerce and industrial activities of the country and the strict liability to promote greater vigilance in financial matters. The incorporation of the provision is designed to safeguard the faith of the r creditor in the drawer of the cheque, which is essential to the economic life of a developing country like India. The provision has been introduced with a view to curb cases of issuing cheques indiscriminately by making stringent provisions and safeguarding interest of creditors.
17. As observed by this Court in Electronics Trade & Technology Development Corpn.
Ltd. v. Indian Technologists & Engineers (Electronics) (P) Ltd. [(1996) 2 SCC 739 :
1996 SCC (Cri) 454] the object of bringing Section 138 in the statute book is to inculcate faith in the efficacy of banking operations and credibility in transacting business on negotiable instruments. The provision is intended to prevent dishonesty ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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on the part of the drawer of negotiable instruments in issuing cheques without sufficient funds or with a view to inducing the payee or holder in due course to act upon it. It thus seeks to promote the efficacy .
of bank operations and ensures credibility in transacting business through cheques. In such matters, therefore, normally compounding of offences should not be denied. Presumably, Parliament also realised this aspect and inserted Section 147 by the Negotiable Instruments (Amendment and Miscellaneous Provisions) Act, 2002 (Act 55 of 2002). The said Section reads thus:
"147. Offences to be compoundable.--
Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), every offence punishable under this Act shall be compoundable."
56. Damodar S. Prabhu v. Sayed Babalal H., (2010) 5 SCC 663 is an important judgment of three Hon'ble Judges of this Court. This judgment dealt, in particular, with the compounding provision contained in Section 147 of the Negotiable Instruments Act. Setting out the provision, the Court held: (SCC pp.668-70, paras 10-12, 15-18 and
21) "10. At present, we are of course concerned with Section 147 of the Act, which reads as follows:
"147. Offences to be compoundable.--
Notwithstanding anything contained in ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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the Code of Criminal Procedure, 1973 (2 of 1974), every offence punishable under this Act shall be compoundable."
At this point, it would be apt to clarify that in view of the non obstante clause, .
the compounding of offences under the Negotiable Instruments Act, 1881 is controlled by Section 147 and the scheme contemplated by Section 320 of the Code of Criminal Procedure (hereinafter "Cr.PC") will not be applicable in the strict sense since the latter is meant for the specified offences under the Penal Code, 1860.
11. So far as Cr.PC is concerned, Section 320 deals with offences which are rcompoundable, either by the parties without the leave of the court or by the parties but only with the leave of the court. Sub-section (1) of Section 320 enumerates the offences which are compoundable without the leave of the court, while sub-section (2) of the said Section specifies the offences which are compoundable with the leave of the court.
12. Section 147 of the Negotiable Instruments Act, 1881 is in the nature of an enabling provision which provides for the compounding of offences prescribed under the same Act, thereby serving as an exception to the general rule incorporated in sub-section (9) of Section 320 Cr.PC which states that "No offence shall be compounded except as provided by this Section". A bare ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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reading of this provision would lead us to the inference that offences punishable under laws other than the Penal Code also cannot be compounded. However, since Section 147 was inserted by way of an amendment .
to a special law, the same will override the effect of Section 320(9) CrPC, especially keeping in mind that Section 147 carries a non obstante clause." xxx xxx xxx
15. The compounding of the offence at later stages of litigation in cheque bouncing cases has also been held to be permissible in a recent decision of this Court, reported as K.M. Ibrahim v. K.P. Mohammed wherein Kabir, J. has noted as follows:-
"13. As far as the non obstante clause included in Section 147 of the 1881 Act is concerned, the 1881 Act being a special statute, the provisions of Section 147 will have an overriding effect over the provisions of the Code relating to compounding of offences. ...
14. It is true that the application under Section 147 of the Negotiable Instruments Act was made by the parties after the proceedings had been concluded before the appellate forum.However, Section 147 of the aforesaid Act does not bar the parties from compounding an offence under Section 138 even at the appellate stage of the proceedings.
Accordingly, we find no reason
to reject the application
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under Section 147 of the
aforesaid Act even in a
proceeding under Article
136 of the Constitution."
16. It is evident that the permissibility of the .
compounding of an offence is linked to the perceived seriousness of the offence and the nature of the remedy provided. On this point we can refer to the following extracts from an academic commentary [cited from: K.N.C. Pillai, R.V. Kelkar's Criminal Procedure, Fifth Edn. (Lucknow: Eastern Book Company, 2008):
"17.2. Compounding of offences.--A crime is essentially a wrong against the society and the r State. Therefore any compromise between the accused person and the individual victim of the crime should not absolve the accused from criminal responsibility. However, where the offences are essentially of a private nature and relatively not quite serious, the Code considers it expedient to recognise some of them as compoundable offences and some others as compoundable only with the permission of the court."
17. In a recently published commentary, the following observations have been made with regard to the offence punishable under Section 138 of the Act [cited from: Arun Mohan, Some thoughts towards law reforms on the topic of Section 138, Negotiable ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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Instruments Act--Tackling an avalanche of cases (New Delhi: Universal Law Publishing Co. Pvt. Ltd., 2009:
"... Unlike that for other forms of crime, the punishment here .
(insofar as the complainant is concerned) is not a means of seeking retribution, but is more a means to ensure payment of money. The complainant's interest lies primarily in recovering the money rather than seeing the drawer of the cheque in jail. The threat of jail is only a mode to ensure recovery. As against the accused who is willing to undergo a jail term, there is little available as remedy for the holder of the r cheque.
If we were to examine the number of complaints filed which were 'compromised' or 'settled' before the final judgment on one side and the cases which proceeded to judgment and conviction on the other, we will find that the bulk was settled and only a miniscule number continued."
18. It is quite obvious that with respect to the offence of dishonour of cheques, it is the compensatory aspect of the remedy which should be given priority over the punitive aspect.
21. With regard to the progression of litigation in cheque bouncing cases, the learned Attorney General has urged this Court to frame guidelines for a graded scheme of imposing ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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costs on parties who unduly delay compounding of the offence. It was submitted that the requirement of deposit of the costs will act as a deterrent for delayed composition, since at present, free and easy .
compounding of offences at any stage, however belated, gives an incentive to the drawer of the cheque to delay settling the cases for years. An application for compounding made after several years not only results in the system being burdened but the complainant is also deprived of effective justice. In view of this submission, we direct that the following guidelines be followed:-
THE GUIDELINES
(i) In the circumstances, it is proposed as follows:
(a) That directions can be given that the Writ of Summons be suitably modified making it clear to the accused that he could make an application for compounding of the offences at the first or second hearing of the case and that if such an application is made, compounding may be allowed by the court without imposing any costs on the accused.
(b) If the accused does not make an application for compounding as aforesaid, then if an application for compounding is made before the Magistrate at a ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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subsequent stage, compounding can be allowed subject to the condition that the accused will be required to pay 10% of the cheque amount to be deposited as a .
condition for compounding with the Legal Services Authority, or such authority as the Court deems fit.
(c) Similarly, if the application for compounding is made before the Sessions Court or a High Court in revision or appeal, such compounding may be allowed on the condition that the accused pays 15% of the cheque amount by way of costs.
(d) Finally, if the application for compounding is made before the Supreme Court, the figure would increase to 20% of the cheque amount."
57. This judgment was followed by a Division Bench of this Court in JIK Industries Ltd. v. Amarlal V. Jumani, (2012) 3 SCC 255, stating:
"68. It is clear from a perusal of the aforesaid Statement of Objects and Reasons that offence under the NI Act, which was previously non-compoundable in view of Section 320 sub- section (9) of the Code has now become compoundable. That does not mean that the effect of Section 147 is to obliterate all statutory provisions of Section 320 of the Code relating to the mode ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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and manner of compounding of an
offence. Section 147 will only override
Section 320(9) of the Code insofar as offence under Section 147 of the NI Act is concerned. This is also the ratio in Damodar .
[(2010) 5 SCC 663 : (2010) 2 SCC (Civ) 520 :
(2010) 2 SCC (Cri) 1328] (see para 12).
Therefore, the submission of the learned counsel for the appellant to the contrary cannot be accepted."
58. The Court then went into the history of compounding in criminal law as follows:
"78. Compounding as codified in Section 320 of the Code has a historical background. In common law compounding was considered a r misdemeanour. In Kenny's Outlines of Criminal Law (19th Edn., 1966) the concept of compounding has been traced as follows:
"422. Mercy should be shown, not sold.--It is a misdemeanour at common law to 'compound' a felony (and perhaps also to compound a misdemeanour); i.e. to bargain, for value, to abstain from prosecuting the offender who has committed a crime. You commit this offence if you promise a thief not to prosecute him if only he will return the goods he stole from you; but you may lawfully take them back if you make no such promise. You may show mercy, but must not sell mercy. This offence of compounding is committed by the bare ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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act of agreement; even though the compounder afterwards breaks his agreement and prosecutes the criminal. And inasmuch as the law permits not merely the person injured by a crime, .
but also all other members of the community, to prosecute, it is criminal for anyone to make such a composition;
even though he suffered no injury and indeed has no concern with the crime."
79. Russell on Crime (12th Edn.) also describes:
"Agreements not to prosecute or to stifle a prosecution for a criminal offence are in certain cases criminal."
r (Ch. 22-- Compounding
Offences, p. 339.)
80. Later on compounding was
permitted in certain categories of cases where the rights of the public in general are not affected but in all cases such compounding is permissible with the consent of the injured party.
81. In our country also when the Criminal Procedure Code, 1861 was enacted it was silent about the compounding of offence. Subsequently, when the next Code of 1872 was introduced it mentioned about compounding in Section 188 by providing the mode of compounding. However, it did not contain any provision declaring what offences were compoundable. The decision as to what offences were ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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compoundable was governed by reference to the exception to Section 214 of the Penal Code. The subsequent Code of 1898 provided Section 345 indicating the offences which were compoundable but the .
said section was only made applicable to compounding of offences defined and permissible under the Penal code. The present Code, which repealed the 1898 Code, contains Section 320 containing comprehensive provisions for compounding.
82. A perusal of Section 320 makes it clear that the provisions contained in Section 320 and the various sub-sections is a code by itself r relating to compounding of offence. It provides for the various parameters and procedures and guidelines in the matter of compounding. If this Court upholds the contention of the appellant that as a result of incorporation of Section 147 in the NI Act, the entire gamut of procedure of Section 320 of the Code are made inapplicable to compounding of an offence under the NI Act, in that case the compounding of offence under the NI Act will be left totally unguided or uncontrolled.
Such an interpretation apart from being an absurd or unreasonable one will also be contrary to the provisions of Section 4(2) of the Code, which has been discussed above. There is no other statutory procedure for compounding of offence under ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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the NI Act. Therefore, Section 147 of the NI Act must be reasonably construed to mean that as a result of the said section the offences under the NI Act are made compoundable, but the main .
principle of such compounding, namely, the consent of the person aggrieved or the person injured or the complainant cannot be wished away nor can the same be substituted by virtue of Section 147 of the NI Act."
59. In Kaushalya Devi Massand v. Roopkishore Khore, (2011) 4 SCC 593, a Division Bench of this Court r succinctly stated:
"11. 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 Penal Code, 1860 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."
60. In R. Vijayan v. Baby, (2012) 1 SCC 260, this Court referred to the provisions of Chapter XVII of the Negotiable Instruments Act, observing that Chapter XVII is a unique exercise which blurs the dividing line between civil and criminal jurisdictions. The Court held:
"16. We propose to address an aspect of the cases ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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under Section 138 of the Act, which is not dealt with in Damodar S. Prabhu. It is sometimes said that cases arising under Section 138 of the Act are really civil cases masquerading as criminal cases. The .
avowed object of Chapter XVII of the Act is to "encourage the culture of use of cheques and enhance the credibility of the instrument".
In effect, its object appears to be both punitive as also compensatory and restitutive, in regard to cheque dishonour cases. Chapter XVII of the Act is a unique exercise which blurs the dividing line between civil and criminal jurisdictions. It provides a single forum and single proceeding, for enforcement of criminal liability (for dishonouring the cheque) and for enforcement of the civil liability (for realisation of the cheque amount) thereby obviating the need for the creditor to move two different fora for relief. This is evident from the following provisions of Chapter XVII of the Act:
(i) The provision for levy of fine which is linked to the cheque amount and may extend to twice the amount of the cheque (Section 138) thereby rendering Section 357(3) virtually infructuous insofar as cheque dishonour cases are concerned.
(ii) The provision enabling a First
Class Magistrate to levy fine
exceeding Rs 5000 (Section
143) notwithstanding the
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ceiling to the fine, as Rs 5000
imposed by Section 29(2) of
the Code.
(iii) The provision relating to
mode of service of summons
(Section 144) as contrasted
.
from the mode prescribed for
criminal cases in Section
62 of the Code.
(iv) The provision for taking
evidence of the complainant
by affidavit (Section 145)
which is more prevalent in
civil proceedings, as
contrasted from the
procedure for recording
evidence in the Code.
(v) The provision making all
offences punishable
under Section 138 of the Act
r compoundable.
17. The apparent intention is to ensure that not only the offender is punished, but also ensure that the complainant invariably receives the amount of the cheque by way of compensation under Section 357(1)(b) of the Code. Though a complaint under Section 138 of the Act is in regard to criminal liability for the offence of dishonouring the cheque and not for the recovery of the cheque amount (which strictly speaking, has to be enforced by a civil suit), in practice once the criminal complaint is lodged under Section 138 of the Act, a civil suit is seldom filed to recover the amount of the cheque. This is because of the provision enabling the court to levy a fine linked to the cheque amount and the usual direction in such cases is for payment as compensation, the cheque amount, as loss incurred by ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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the complainant on account of dishonour of cheque, under Section 357(1)(b) of the Code and the provision for compounding the offences under Section 138 of the Act. Most of the cases (except those where liability is denied) get .
compounded at one stage or the other by payment of the cheque amount with or without interest.
Even where the offence is not compounded, the courts tend to direct payment of compensation equal to the cheque amount (or even something more towards interest) by levying a fine commensurate with the cheque amount. A stage has reached when most of the complainants, in particular the financing institutions (particularly private financiers) view the proceedings under Section r 138 of the Act, as a proceeding for the recovery of the cheque amount, the punishment of the drawer of the cheque for the offence of dishonour, becoming secondary." (emphasis supplied)
61. In Dashrath Rupsingh Rathod v. State of Maharashtra, (2014) 9 SCC 129, a three-Judge Bench of this Court answered the question as to whether the territorial jurisdiction for filing of cheque dishonour complaints is restricted to the court within whose territorial jurisdiction the offence is committed, which is the location where the cheque is dishonoured, i.e., returned unpaid by the bank on which it is drawn. This judgment has been legislatively overruled by Section 142(2) of the Negotiable Instruments Act set out hereinabove. However, Shri Mehta relied upon paragraphs 15.2 and 17 of the judgment of Vikramjit Sen, J., which ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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states as follows:
"15.2. We have undertaken this succinct study mindful of the fact that Parliamentary debates have a limited part to play .
in interpretation of statutes, the presumption being that legislators have the experience, expertise and language skills to draft laws which unambiguously convey their intentions and expectations for the enactments. What is palpably clear is that Parliament was aware that they were converting civil liability into criminal content inter alia by the deeming fiction of culpability in terms of the pandect comprising Section 138 and the succeeding sections, which severely curtail defences to prosecution. Parliament was also aware that the offence of cheating, etc. already envisaged in IPC, continued to be available."
xxx xxx xxx "17. The marginal note of Section 138 of the NI Act explicitly defines the offence as being the dishonour of cheques for insufficiency, etc. of funds in the account. Of course, the headings, captions or opening words of a piece of legislation are normally not strictly or comprehensively determinative of the sweep of the actual Section itself, but it does presage its intendment. See Frick ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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India Ltd. v. Union of India [(1990) 1 SCC 400 : 1990 SCC (Tax) 185] and Forage & Co. v. Municipal Corpn. of Greater Bombay [(1999) 8 SCC 577]. Accordingly, unless the provisions of the section .
clearly point to the contrary, the offence is concerned with the dishonour of a cheque; and in the conundrum before us the body of this provision speaks in the same timbre since it refers to a cheque being "returned by the bank unpaid". None of the provisions of IPC have been rendered nugatory by Section 138 of the NI Act and both operate on their own. It is trite that mens rea is the quintessential of every crime. The objective of Parliament was to strengthen the use of cheques, distinct from other negotiable instruments, as mercantile tender and therefore it became essential for Section 138 of the NI Act offence to be freed from the requirement of proving mens rea. This has been achieved by deeming the commission of an offence dehors mens rea not only under Section 138 but also by virtue of the succeeding two sections. Section 139 carves out the presumption that the holder of a cheque has received it for the discharge of any liability. Section 140 clarifies that it will not be available as a defence to the drawer that he had no reason to believe, when he issued the cheque, that it ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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would be dishonoured. Section 138 unequivocally states that the offence is committed no sooner the drawee bank returns the cheque unpaid."
The focus in this case was on the .
court within whose jurisdiction the offence under Section 138 can be said to have taken place. This case, therefore, has no direct relevance to the point that has been urged before us.
62. In Lafarge Aggregates & Concrete India (P) Ltd. v.
Sukarsh Azad, (2014) 13 SCC 779, this Court, continuing the trend of the earlier judgments in describing the hybrid nature of these provisions, held:
"6. The respondents have agreed to pay the said amount but the appellant has refused to accept the payment and insisted that the appeal against rejection of the recall application should be allowed by this Court. The counsel for the appellant submitted that merely because the accused has offered to make the payment at a later stage, the same cannot compel the complainant appellant to accept it and the complainant appellant would be justified in pursuing the complaint which was lodged under the Negotiable Instruments Act, 1881. In support of his submission, the counsel for the appellant also relied on Rajneesh Aggarwal v. Amit J. Bhalla.::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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7. However, we do not feel persuaded to accept this submission as the appellant has to apprise himself that the primary object and reason of the Negotiable Instruments Act, 1 The judgment .
in Rajneesh Aggarwal v. Amit J. Bhalla, (2001) 1 SCC 631 was delivered prior to the 2002 and 2018 Amendment Acts to the Negotiable Instruments Act. The perceptible shift in the provisions by introducing Sections 143 to 148 has been noticed by this Court hereinabove, as a result of which the observations contained in this judgment would no longer be valid.
1881, is not merely penal in nature but is r to maintain the efficiency and value of a negotiable instrument by making the accused honour the negotiable instrument and paying the amount for which the instrument had been executed.
8. The object of bringing Sections 138 to 142 of the Negotiable Instruments Act on statute appears to be to inculcate faith in the efficacy of banking operations and credibility in transacting business of negotiable instruments. Despite several remedies, Section 138 of the Act is intended to prevent dishonesty on the part of the drawer of negotiable instrument to draw a cheque without sufficient funds in his account maintained by him in a bank ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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and induces the payee or holder in due course to act upon it. Therefore, once a cheque is drawn by a person of an account maintained by him for payment of any amount or discharge of liability or debt or .
is returned by a bank with endorsement like (i) refer to drawer, (ii) exceeds arrangements, and (iii) instruction for stop payment and like other usual endorsement, it amounts to dishonour within the meaning of Section 138 of the Act. Therefore, even after issuance of notice if the payee or holder does not make the payment within the stipulated period, the statutory presumption would be of r dishonest intention exposing to criminal liability."
xxx xxx xxx
10. However, in the interest of equity, justice and fair play, we deem it appropriate to direct the respondents to make the payment to the appellant by issuing a demand draft in their favour for a sum of Rs 5 lakhs, which would be treated as an overall amount including interest and compensation towards the cheque for which stop-payment instructions had been issued. If the same is not acceptable to the appellant, it is their choice but that would not allow them to prosecute the respondents herein in pursuance to the complaint which they have lodged implicating these two respondents."
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13. In the background, of the facts of the instant case and the statutory provisions and the mandate of the Hon'ble Supreme Court, in cases of Kanchan .
Mehta, Madan Tiwari and P. Mohanraj [supra], once the proceedings under Section 138 have been held to be proceedings in the form of a civil sheep in a criminal wolf's clothing, therefore, once the petitioner-accused has amicably decided to settle/liquidate/discharge his liability, though, the transaction-proceedings have a tinge of criminal liability, then, on settling the entire liability in view of Section 147 of the Negotiable Instruments Act, the compounding of offences, on discharge of liability, appears to be genuine, which is certainly is a step towards securing the ends of justice. It is relevant to observe that once the Respondent-Complainant who had initiated the proceedings under Section 138 of the Negotiable Instruments Act, 1881, has received his cake then, no useful purpose will be achieved in continuing the criminal proceedings, against the accused-petitioner who has discharged/liquidated his liability.
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14. It is not in dispute that the cheque dated 01.02.2016, was issued by petitioner [Sunil Kumar], which was presented to the Bank and thereafter the same .
was dishonoured. Consequently, Respondent No.1 [M/s Anand Automobile NH-20 Bodh, Tehsil Nurpur, District Kangra, H.P], instituted a Criminal Case No. 6-III/2016, before the Learned Judicial Magistrate First Class, Court No.II, Nurpur, District Kangra, (HP), which was decided on 27.11.2018 [Annexure P-1], whereby, the petitioner-accused [Sunil Kumar] herein was convicted and sentenced for six months' simple imprisonment and was held liable for a compensation of Rs.6,00,000/-
[Rupees Six Lakh] [cheque amount and compensation thereon] to be paid to the complainant.
15. Feeling aggrieved against the judgment passed by the Learned Trial Court, the petitioner-accused [Sunil Kumar], herein assailed the same before the Learned Appellate Court in Criminal Appeal No. 12-N/X/2018, but the aforesaid appeal also met the fate of dismissal on 08.07.2022 [Annexure P-2], whereby, the judgment ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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of conviction and sentence was upheld.
16. After the order of conviction and sentence passed by the Learned Trial Court, which was affirmed .
by the Learned Appellate Court, the petitioner-accused [Sunil Kumar], is suffering custody in Sub Jail, Nurpur, District Kangra [H.P.], since 08.03.2024, till day.
17. Now, once the petitioner-accused [Sunil Kumar] has remitted his outstanding entire liability of Rs.6,00,000/-r [Rupees Six Lakh], in favour of the Respondent No.1-Complainant [M/s Anand Automobile NH-20 Bodh, Tehsil Nurpur, District Kangra, H.P] and the Respondent No.1-complainant [M/s Anand Automobile NH-20 Bodh, Tehsil Nurpur, District Kangra, H.P] also admits that Respondent No.1-Complainant has received the entire amount and nothing is outstanding from the petitioner-accused [Sunil Kumar], in relation to the cheque, in question, as on day.
18. Notably, the object of Section 147 of the Negotiable Instruments Act, 1881, is that in case the accused under the aforesaid enactment remits/discharges ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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or liquidates his liability then such a person can be absolved of the criminal action-prosecution by permitting compounding of offence in proceedings under Section 138 .
of the Act. Moreover, once the petitioner-accused has discharged/liquidated his liability towards Respondent-
Complainant, therefore, the continuance of criminal proceedings will not serve any purpose. The compounding of an offence would enable both the parties to lead life of respect and dignity in the society. Once, no dispute remains between the parties to the lis, then obviously the law cannot be so harsh so as to stand as a wall between the parties notwithstanding the amicable settlement inter se the parties. Continuation of criminal proceedings in such circumstances, would only cause an irreparable harassment and hardship and may even tarnish and spoil the reputation of the petitioner-accused. The Court proceedings cannot be permitted to de-generate into a weapon of harassment and persecution. The power to do complete justice is the very essence of every judicial justice dispensation system. It cannot be diluted by ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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distorted perceptions and is not a slave to anything, except to the caution and circumspection, the standards of which the Court sets before it, in exercise of such plenary .
and unfettered power inherently vested in it while donning the cloak of compassion to achieve the ends of justice.
19. The compromise, in a modern society, is the sine qua non of harmony and orderly behavior. It is the soul of justice and if the power under Section 482 of the Cr.P.C or power under other statutes, including Section 147 of the Negotiable Instruments Act, 1881, is used to enhance such a compromise which, in turn, enhances the social amity and reduces friction, then it truly is "finest hour of justice".
20. As observed by the Hon'ble Supreme Court in Mrs. Shakuntala Sawhney vs. Mrs. Kaushalya Sawhney and others, 1980 (1) SCC 63, while summing up the essence of compromise, it observed as under:-
"....The finest hour of justice arrives propitiously when parties, despite falling apart, bury the hatchet and weave a sense of fellowship of reunion."::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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21. In the entirety of the facts and circumstances and the mandate of law, referred to above, this Court on .
the basis of the material placed on record is satisfied that the petitioner-accused [Sunil Kumar] and Respondent No.1-Complainant have settled the dispute and Respondent No.1-Complainant has no grudges against the petitioner-
accused, who has liquidated/discharged/remitted his liability in r favour of the complainant. In these circumstances, allowing the judicial prosecution to continue will result in disturbing the peace and harmony but will also create or give rebirth to bitterness and enmity amongst them. Moreover, the ends of justice would be satisfied in case, the parties herein are allowed to compromise. Further continuance of the proceedings despite having been amicably settled, will otherwise lead to abuse of process. Lastly, once the proceedings originating from Section 138 of the Negotiable Instruments Act primarily being civil proceedings with criminal clothing but it has an objective to ensure that the parties to the ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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proceedings under Section 138 of the Negotiable Instruments Act remit their monetary liability and such transactions inter se the parties do not have any .
adversarial societal ramifications. Continuance of the judicial proceedings when parties have compromised or amicably resolved the dispute will be a futile exercise; will burden the dockets of Courts; and making the parties to lis to face proceedings despite having amicably resolved the issue knowing fully well that these proceedings will not end in conviction and the continuance will end in futility.
22. Consequently, the judgments dated 27.11.2018 [Annexure P-1], passed by the Learned Trial Court, in Criminal Case No.6-III/2016, titled as M/s Anand Automobile, NH20 Bodh, Teshil Nurpur (Kangra (HP) versus Sunil Kumar which stands affirmed by Learned Appellate Court, in Criminal Appeal No.12-N/X/2018, titled as Sunil Kumar versus M/s Anand Automobile, NH20 Bodh, Teshil Nurpur (Kangra) (HP) on 08.07.2022 [Annexure P-2], convicting and sentencing the petitioner-
accused [Sunil Kumar] herein, are quashed-set aside and ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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rendered inoperative, for all intents and purposes, so far it relates to the cheque in dispute, in the instant case.
Resultantly, the petitioner-accused shall stand acquitted of .
alleged offence under Section 138 of the Negotiable Instruments Act, 1881.
23. Since, the petitioner-accused [Sunil Kumar] is suffering custody in Sub Jail, Nurpur, District Kangra, [H.P.]; therefore, the Respondents-State Authorities are directed to release the petitioner-accused [Sunil Kumar], if not required in any other case. Release warrants be prepared and consequential action be taken expeditiously in accordance with law.
24. Petitioner is permitted to produce/use copy of this order, downloaded from the web-page of the High Court of Himachal Pradesh, before the authorities concerned, and the said authorities shall not insist for production of a certified copy, but if required, may verify passing of order from Website of the High Court.
In the aforesaid terms, the petition stands disposed of accordingly. Pending miscellaneous ::: Downloaded on - 12/04/2024 20:38:23 :::CIS
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application(s), if any, also stands disposed of.
(Ranjan Sharma)
April, 08, 2024 Judge
(himani)
.
r to
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