Himachal Pradesh High Court
M/S Tarun Fabrication & Another vs H.P. Financial Corporation on 12 September, 2019
Author: Anoop Chitkara
Bench: Anoop Chitkara
IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA
Criminal Revision No.113 of 2012
.
Date of Decision : 12-09-2019
M/S Tarun Fabrication & another ...Petitioners.
Versus
H.P. Financial Corporation ...Respondent.
Coram:
The Hon'ble Mr. Justice Anoop Chitkara, Judge.
Whether approved for reporting? No
For the petitioners : Mr. Rakesh Dhaulta, Advocate.
For the respondent : Mr. Yash Pal Rana, Advocate.
Anoop Chitkara, Judge (oral)
Challenging the judgment of conviction passed by the learned Sessions Judge, Shimla, H.P. in Criminal Appeal No. 3-S/10 of 2010 dated 30-04-2012 whereby the first Appellate Court had affirmed the judgment of conviction passed by learned Judicial Magistrate, 1st Class, Court No.6, District- Shimla, HP in complaint No. 118/3 of 2008 dated 22-12-2009 under Section 138 read with Section 142 of the Negotiable Instruments Act, 1881 (hereinafter referred to as the N.I. Act).
The petitioner has come up in this Court for invoking the revisional jurisdiction under Section 397 read with Section 401 of the Code of Criminal Procedure.
::: Downloaded on - 29/09/2019 04:18:03 :::HCHP 22. The facts of the case apposite to decide the present petition are that the accused had entered into a contract with H.P. Financial .
Corporation and availed a term loan amounting to Rs.3,66,000/-, soft loan of Rs. 1,42,000/- and Working Capital loan of Rs. 2,67,000/- from the respondent corporation on 04-04-2006. However, the accused failed to reimburse the loan amount and consequently issued a cheque bearing No. 0292234 dated 25-04-2008 amounting to Rs.50,000/- in favour of H.P Financial Corporation. On 09-05-2008 the said cheque was dishonoured on account of insufficient funds. The complainant issued the requisite notice to make up the deficiency of funds but despite that the petitioner did not make the payment. Accordingly, aforesaid complaint was filed by the H.P. Financial Corporation. The Trial Court convicted the accused under Section 138 of the N.I. Act and sentenced him to undergo simple imprisonment for six months and ordered to pay compensation amount of Rs. 50,000/- under Section 357 (3) of Cr.P.C.
3. The Appellate Court upheld the conviction and now the convict has come up with the present Criminal Revision. On 12-09-2019 Sh. Rakesh Dhaulta, Advocate, appeared for the petitioner/convict and stated at bar that entire compensation amount stands deposited and further stated that the respondent has no objection, if the matter is compounded.
4. Learned Counsel appearing for the petitioner, submits that since the complainant is an Institution, therefore, due to procedural ::: Downloaded on - 29/09/2019 04:18:03 :::HCHP 3 formalities it is almost impossible to enter into a compromise with respondent-corporation and since entire compensation has been paid as .
such matter be compounded. He further stated that the petitioner is in a very bad financial condition as such some relaxation be made in compounding fees, as directed by Hon'ble Supreme Court in Meters and Instruments Private Limited vs. Kanchan Mehta, (2018) 1 SCC 560, wherein it has been observed as under:-
"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."
5. Therefore, in my considered view, the offence is ordered to be compounded and all proceedings are quashed on the following grounds:-
I. The jurisprudence behind the N.I. Act is that the business transactions should be honoured. The legislative intention is not to send the people to suffer incarceration because their cheque was bounced. These proceedings are simply to execute the recovery of cheque amount by showing teeth of penal loss.
II. This Court has inherent powers under Section 482 of the Code of Criminal Procedure which are further supported by Section 147 of the N.I. Act to interfere in these kind of matter where parties have paid the entire money and where the complainant does not object to clear all the proceedings.::: Downloaded on - 29/09/2019 04:18:03 :::HCHP 4
6. In view of the entirety of the facts of the case, as well as .
judicial precedents, a few of which have been mentioned herein above, I am of the considered opinion that continuation of these proceedings will not suffice any fruitful purpose whatsoever. Therefore, I am of the considered opinion that in view 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, should be invoked to compound the offence and consequently to quash the consequent proceedings.
7. In Shakuntala Sawhney v. Kaushalya Sawhney, (1979) 3 SCR 639, at p 642, Hon'ble Supreme Court observed as follows:
"The finest hour of Justice arise propitiously when parties, despite falling apart, bury the hatchet and weave a sense of fellowship or reunion."
8. Consequently, in view of compounding of offence, the judgment dated 30-04-2012, passed in Criminal Appeal No.3-S/10 of 2010, titled as M/s Tarun Fabrication & another Vs. Himachal Pradesh Financial corporation, pronounced by learned Sessions Judge-Shimla, Himachal Pradesh, whereby he upheld the judgment passed by Judicial Magistrate 1st Class, Court No.6, Shimla, District Shimla, H.P., in Complaint No.118/3 of 2008, titled as Himachal Pradesh Financial corporation Vs. M/s Tarun Fabrication & another, convicting and sentencing the petitioner, are quashed and set aside. Consequently, the petitioner is acquitted of the ::: Downloaded on - 29/09/2019 04:18:03 :::HCHP 5 offence under Section 138 of the Act. The bail bonds are accordingly discharged.
.
9. This compounding is subject to the convict/accused depositing 15% of the cheque amount, in terms of the judgment passed by a Larger Bench of Hon'ble Supreme Court in Damodar S. Prabhu v.
Sayed Babalal H., (2010) 5 SCC 663, whereby following law for compounding of offences punishable under Negotiable Instruments Act, 1881 was laid down:
"....21...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 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 ::: Downloaded on - 29/09/2019 04:18:03 :::HCHP 6 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.
Let it also be clarified that any costs imposed in accordance with these guidelines should be deposited with the Legal Services Authority operating at the level of the Court before which compounding takes place. For instance, in case of compounding during the pendency of proceedings before a Magistrate's Court or a Court of Sessions, such costs should be deposited with the District Legal Services Authority. Likewise, costs imposed in connection with composition before the High Court should be deposited with the State Legal Services Authority and those imposed in connection with composition before the Supreme Court should be deposited with the National Legal Services Authority."
10. The learned trial Court shall release all the amount in the manner discussed here-in-above on the production of certified copy of this judgment by respondent. In view of the above statement of the learned counsel for the petitioner, the respondent/complainant is entitled to receive the compensation amount of Rs. 50,000/-. In case, the compensation amount is deposited with the Trial Court or put in the Fixed Deposit, then all the interest accrued, thereupon shall also be given to the complainant.
However, if there is short fall in deposit of compensation then such short fall shall be met with by the convict/petitioner on or before 31 st ::: Downloaded on - 29/09/2019 04:18:03 :::HCHP 7 October,2019. It is made clear that the interest, if any, accrued upon the fixed deposit shall not be treated towards compensation and total .
compensation amount shall have to be deposited by the convict/petitioner.
11. Apart from the above, the petitioner/convict shall deposit 15% of the cheque amount in view of the judgment in Damodar S. Prabhu (supra) before the H.P. State Legal Services Authority, Shimla. The compensation awarded is Rs.50,000/- therefore, 15% of the same comes to Rs. 7,500/-. In view of the above, this Criminal Revision is allowed in aforesaid terms. The certified copy of this petition be sent to the Trial Court. Record of the Trial Court, if called for, be also returned. The petitioner shall do the needful on or before 31 st October, 2019, failing which the present compounding shall automatically be revoked and he shall be deemed to be convicted. In case of any exigency, the petitioner/convict may come up before this Court for extension of time.
12. Accordingly, Criminal Revision is disposed of. Bail bonds are discharged. Record be returned.
All pending application(s), if any, also stand disposed of.
(Anoop Chitkara), Judge.
September 12th, 2019 (NK) ::: Downloaded on - 29/09/2019 04:18:03 :::HCHP