IN THE HIGH COURT OF JUDICATURE AT PATNA
SANJAY KAROL, S. KUMAR, JJ.
Sunil Kumar, Son of Ramadhyan Yadav – Appellant
Versus
The State of Bihar through the Collector, Aurangabad, Bihar – Respondent
Civil Writ Jurisdiction Case No.73 of 2022
Decided on : 10-05-2022
Negotiable Instruments Act, 1881 – Sections 138 & 143 A & Bihar & Orissa Public Demands Recovery Act, 1914 – Section 3(6) read with Code of Criminal Procedure, 1973 – Section 421 – Whether an order for payment of interim compensation under the Negotiable Instruments Act can be enforceable under the Bihar & Orissa Public Demands Recovery Act, 1914 as a public demand? – Section 143 A of the NI Act under Sub-Section (5) specifically states that interim compensation payable under this Section is recoverable as a fine under Section 421 of the Code of Criminal Procedure – Section 421(1)(b) provides for issuance of warrant to the Collector to realize amounts as arrears of land revenue from movable and immovable properties of said defaulter – further, clause 3 of Schedule I of the Recovery Act states that any money realizable as arrear of land revenue by process authorized for said purpose shall be deemed a public demand under Section 3 of the Act – the interim compensation as ordered by the impugned order under Section 143 A of the NI Act is recoverable as a fine under Section 421 of the Cr.P.C., which clearly falls under the definition of 'Public Demand' and its realization thereunder cannot be stopped – impugned order does not suffer with any infirmity – Writ petition disposed of with liberty to avail alternative remedy. (Paras 18 to 21)
(2019) 1 SCC 341, (2019) 19 SCC 469, (2020)2 SCC 514 para 17, AIR 1984 Patna 107. – Referred.
JUDGMENT :
The following question of law arises for consideration in this writ petition:-
FACTS
2. The respondent No.4, namely Arun Kumar, (referred to as the private respondent) trader of paddy, wheat etc. allegedly delivered goods worth Rs.1,26,75,600/-to the petitioner, namely Sunil Kumar in the period of 23.08.2018 to 30.08.2018. As consideration, petitioner issued a cheque no.170288 on 15.03.2019 of Punjab National Bank, Aurangabad which on presentation was dishonoured. Private Respondent sent a legal notice and failure to comply subsequently filed Complaint Case No.319 of 2019 on 16.04.2019 before the Chief Judicial Magistrate, Aurangabad under Section 138 of the Negotiable Instrument Act, 1881 (hereinafter referred to as NI Act).
3. The learned Additional Chief Judicial Magistrate, III Aurangabad vide order dated 21.11.2019 upon consideration of facts and the record, passed an order of interim compensation of Rs.25,00,000/-under Section 143A of the NI Act to be paid by the petitioner herein to the private respondent, within a period of sixty days from the date of order. Subsequently, an order for execution was passed on 28.01.2021 where noting that sufficient time had passed since the original order, extension could not be granted and Section 421(1) (b) of the Code of Criminal Procedure was invoked and a warrant was issued to the Collector, Aurangabad authorizing him to realize the above stated amount from the moveable and immovable of the petitioner herein.
4. Pursuant to the above order, the Collector, Aurangabad forwarded the same to the District Certificate Officer, Aunrangabad for suitable action, who, registered Certificate Case No.100 /2021-22 and issued notice dated 03.12.2021 (Annexure-4, Page-28) calling upon the petitioner to pay the said amount within a period of thirty days.
5. In the submissions made before this Court, learned counsel for the petitioner contends that the Bihar and Orissa Public Demands Recovery Act, 1914 (hereinafter referred to as the Recovery Act) does not have any application, whatsoever, in the present case. In other words, a jurisdictional vice vitiates such proceedings.
6. It is noted here that though a separate challenge to the order for interim compensation is pending consideration before this Court bearing No. Cr. Misc. No.15524 of 2020 titled as Sunil Kumar v. The State of Bihar & ors but as on date such order is enforceable.
7. Before proceeding to the issue at hand, it would be fit to refer to and/or extract the relevant law for ready reference.
Negotiable Instruments Act, 1881
8. In Surinder Singh Deswal alias Colonel S.S. Deswal v. Virender Gandhi, (2019) 11 SCC 341, Hon’ble the Supreme Court extensively dealt with the aims, object and purpose of the Negotiable Instruments (Amendment) Act, 2018 (20 of 2018). It observed that “The Negotiable Instruments Act, 1881 (the Act) was enacted to define and amend the law relating to Promissory Notes, Bills of Exchange and Cheques. The said Act has been amended from time to time so as to provide, inter alia, speedy disposal of cases relating to the offence of dishonour of cheques. However, the Central Government has been receiving several representations from the public including trading community relating to pendency of cheque dishonour cases. This is because of delay tactics of unscrupulous drawers of dishonoured cheques due to easy filing of appeals and obtaining stay on proceedings. As a result of this, injustice is caused to the payee of a dishonoured cheque who has to spend considerable time and resources in court proceedings to realise the value of the cheque. Such delays compromise the sanctity of cheque transactions. 2. It is proposed to amend the said Act with a view to address the issue of undue delay in final resolution of cheque dishonour cases s
Ram Chandra Singh vs State Of Bihar And Ors. on 12 November, 1986
Surinder Singh Deswal alias Colonel S.S. Deswal v. Virender Gandhi
Interim compensation under Section 143-A of the NI Act is discretionary, requiring consideration of both parties' merits and the opportunity for a defense, which was not provided in this case.
[The provisions of Section 143A of the NI Act, 1881 are directory and grant discretion to the court to award interim compensation, which must be exercised based on a prima facie evaluation of the mer....
The main legal point established in the judgment is the discretionary nature of the provision under Section 143A of the N.I. Act, the requirement for the court to consider relevant factors and record....
Power under Section 143A NI Act to direct interim compensation is discretionary, requiring prima facie evaluation of case and defence, with brief reasons recorded; mechanical orders lacking applicati....
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