BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
P. Devadass, J.
M/s. VTX Industries Limited and Ors. – Petitioners
Vs.
M/s. Thiagarajar Mills Private Limited – Respondent
C.R.L.RC(MD) Nos.400 of 2016 to 408 of 2016 and Crl.M.P.(MD) Nos.4858 to 4866 of 2016
Decided On : 20-06-2016
Criminal Procedure Code, 1973 – Section 357(3) and 441 - N.I. Act - Section 138 - Companies Act - Cheque amount as compensation - Suspension of sentence of imprisonment - Petition will be allowed only on condition that the petitioner is directed to deposit 1/4th amount of impugned cheque amount in this case before trial Court without prejudice to contention of both sides in appeal on or before and file proof of same before this court failing which this petition stands dismissed. Call for compliance of said order by petitioner herein - Impugned orders shows that if ¼th, of cheque amount is not deposited by appeal bail petitions itself will stand dismissed - In other words, suspension of sentence ordered itself will go away - Though appellant was happy that suspension of sentence of imprisonment was ordered, he was very much unhappy as to direction to deposit 1/4th of cheque amount – Held, transaction involved in present cheque bouncing cases arose out of supply of yarn by complainant company to accused company - Liabilities were sought to be enforced out of such transaction as legally recoverable sum since cheques for payment were bounced - Now, amounts are with reference to business transaction done by accused Company - If Court forget for a moment that it is a cheque bouncing case, for very same transaction just like any other creditors, who seek to enforce their liability before the Company Court complainant/company has to go before Provisional Liquidator and seek disbursement from amounts realised - learned appellate Judge in his order mentioning that in event of non deposit of the amount directed on or before appeal bail will go away is not correct. It is against law- Once bail granted, it cannot not be taken away automatically, whether it may be bail before judgment or after judgment - It can be cancelled only in a manner known to law, that too after hearing accused and it shall be by a specific order - Revision petitions are allowed - Consequently, connected Miscellaneous Petitions are closed.
Some queer questions arises in these revisions.
2. These revisions arose out of grant of appeal bails by the learned Principal Sessions Judge, Madurai in Crl.M.P.Nos.433 to 441 of 2016 in C.A.Nos.30 to 38 of 2016.
3. Incidentally, there arises a clash between criminal law, company law and certain basic principles of general penal law of India.
4. As these petitions presents very same complex questions we have tagged them together and we shall dispose of them together.
5. The details of the revisions are as under:
Case No.
Conviction
Sentence
S.T.C.No.1774 of 2012
u/s 138 N.I. Act
1 years S.I. + Rs.60,00,000/- as compensation u/s 357(3) Cr.P.C.
S.T.C.No.1775 of 2012
-do-
-do-
S.T.C.Nos.1776 of 2012
-do-
-do-
S.T.C.Nos.1867 of 2012
-do-
1 years S.I. + Rs.50,00,000/- as compensation u/s 357(3) Cr.P.C.
S.T.C.Nos.1868 of 2012
-do-
-do-
S.T.C.Nos.1805 of 2012
-do-
1 years S.I. + Rs.1,29,00,000/- as compensation u/s 357(3) Cr.P.C.
S.T.C.Nos.1806 of 2012
-do-
1 years S.I. + Rs.58,00,000/- as compensation u/s 357(3) Cr.P.C.
S.T.C.Nos.1807 of 2012
-do-
1 years S.I. + Rs.50,00,000/- as compensation u/s 357(3) Cr.P.C.
S.T.C.Nos.1866 of 2012
-do-
-do-
6. The accused have been prosecuted before the learned Judicial Magistrate No. I, FTC Level, Madurai under Section 138 of N.I. Act. The Company/A1 as well as its Managing Director/A2 were convicted. Besides sentence of imprisonment, cheque amount has been ordered as compensation under 357(3) Cr.P.C. No fine amount has been imposed. No default clause for non-payment of compensation has been prescribed.
7. The matter was carried further to the Principal Sessions Judge, Madurai in C.A.Nos.30 to 38 of 2016.
8. Pending consideration of the Criminal Appeals, in Crl.M.P.Nos.433 to 441 of 2016, they have sought for appeal bail from the Principal Sessions Judge, Madurai.
9. The learned Appellate Judge while granting suspension of sentence of imprisonment also ordered as under:
“11. In the result, the petition will be allowed only on condition that the petitioner is directed to deposit 1/4th amount of the impugned cheque amount in this case before the trial Court without prejudice to the contention of both sides in the appeal on or before 23.06.2016 and file the proof of the same before this court failing which this petition stands dismissed. Call on 24.06.2016 for compliance of the said order by the petitioner herein.”
10. Now, the impugned orders shows that if the ¼th, of the cheque amount is not deposited by 23.06.2016 the appeal bail petitions itself will stand dismissed. In other words, the suspension of sentence ordered itself will go away. Though the appellant was happy that suspension of sentence of imprisonment was ordered, he was very much unhappy as to the direction to deposit 1/4th of the cheque amount. That is how he is before us.
11. The learned senior counsel for the revision petitioner/appellant/accused would submit that admittedly the trial Court did not impose any fine. It had issued directions under Section 357(3) Cr.P.C. to pay the cheque amount as compensation. In the event of non-deposit of the said amount no default sentence has been prescribed. In such circumstances, in appeal bail petitions, indirectly that amount cannot be collected. Further, legally speaking as per Section 441 Cr.P.C., for collecting such compensation amount respondent has to recourse to the procedure prescribed under the Code of Criminal Procedure and pursue it with the assistance of the Revenue Authorities.
12. The learned Senior Counsel for the revision petitioners emphasized that under the Code of Criminal Procedure default sentence for non-payment of compensation amount is impermissible.
13. In this connection, the learned Senior Counsel for the petitioners referred to the proc
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