Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2022 Supreme(P&H) 714

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
Namit Kumar, J.
Rajesh Sharma - Appellant
Versus
Gagan Fibres Pvt. Ltd. - Respondent
CRM-M-42518-2022
Decided On : 26-09-2022

Advocates:
Mr. Manuj Nagrath, Advocate for the petitioner., for the Appellant; ; , for the Respondent

The main legal point established in the judgment is the retrospective applicability of Section 148 of the Negotiable Instruments Act, the mandatory nature of the Appellate Court's discretion to direct the appellant to deposit the sum, and the validity of the condition for depositing compensation to prevent delay tactics in cheque dishonor cases.

Headnote:
Section 482 - Quashing of Order - Negotiable Instruments Act, 1881 - Section 138 - Section 148 - [Section 138, Section 148 of the Negotiable Instruments Act, 1881] - The court discussed the applicability of Section 148 of the Negotiable Instruments Act, 1881, which allows the Appellate Court to order the appellant to deposit a minimum of twenty per cent of the fine or compensation awarded by the trial Court. The court highlighted the retrospective application of Section 148 and its purpose to prevent delay tactics in cheque dishonor cases. The court emphasized that the discretion vested with the Appellate Court to direct the appellant to deposit the sum is to be construed as mandatory, and failure to comply may result in the cancellation of the bail order. The judgment also referenced case law to support the interpretation of Section 148 and upheld the validity of the condition for depositing compensation. The court concluded that the impugned order was legal and valid.
Fact of the Case:

The respondent filed a complaint under Section 138 of the Negotiable Instruments Act against the petitioner for dishonoring cheques. The petitioner was convicted and sentenced to imprisonment and fine. The petitioner filed an appeal and subsequent applications for suspension of sentence. The respondent filed an application under Section 148 of the Negotiable Instruments Act for directing the petitioner to deposit the cheque amount as compensation. The impugned order directed the petitioner to pay 20% of the compensation on the next date of hearing, failing which the bail order would be cancelled.
Finding of the Court:

The court found that Section 148 of the Negotiable Instruments Act is retrospective and applicable to all appeals filed against the order of conviction and sentence for the offence under Section 138, even in cases where the complaints were filed prior to the amendment. The court upheld the validity of the condition for depositing compensation and emphasized the mandatory nature of the Appellate Court's discretion in this regard.
Issues: The issues involved the applicability of Section 148 of the Negotiable Instruments Act to appeals filed before and after the amendment, and the validity of the condition for depositing compensation imposed by the Appellate Court.
Ratio Decidendi: The court held that Section 148 of the Negotiable Instruments Act is retrospective and applicable to all appeals, and the discretion vested with the Appellate Court to direct the appellant to deposit the sum is to be construed as mandatory. The court also emphasized the importance of upholding the condition for depositing compensation to prevent delay tactics in cheque dishonor cases.
Final Decision: The court concluded that the impugned order was legal and valid, and there was no ground for interference.

JUDGMENT

Namit Kumar, J. - The instant petition has been filed by the petitioner under Section 482 of the Code of Criminal Procedure, 1973 for quashing the order dated 27.07.2022 passed by the learned Additional Sessions Judge, Ludhiana in Criminal Appeal No.126 of 2020 (Rajesh Sharma versus M/s Gagan Fibers Pvt. Ltd.), whereby, the application filed by the complainant/respondent under Section 148 of Negotiable Instruments Act, 1881 has been allowed and the petitioner has been directed to pay 20% of the compensation i.e. Rs.3,07,828/- of Rs.15,39,142/- on the next date of hearing with a further direction that in case this amount is not paid then bail order shall be cancelled and petitioner shall be taken into custody as the bail granted to him is always subject to the decision of Section 148 of the Negotiable Instruments Act, 1881.

2. Briefly stated the facts of the case are that the respondent filed a complaint under Section 138 of the Negotiable Instruments Act read with Section 420 IPC against the petitioner titled as 'M/s Gagan Fibres Private Ltd. versus Rajesh Sharma', COMA/924/2014 dated 13.02.2014 before the learned Judicial Magistrate 1st Class, Ludhiana on the basis of allegations that petitioner purchased polyester chips from the respondent-complainant from time to time on credit basis and that in discharge of the said invoices, the petitioner had issued eight cheques bearing Nos. 155141; 155145; 155147; 155148; 155150; 155175; 155179 & 155200 dated 16.12.2013 which were dishonoured with remarks 'Exceed Arrangement'.

3. On completion of trial, vide judgment dated 23.01.2020 (Annexure P-1) passed by the trial Court, the petitioner was convicted and sentenced to undergo rigorous imprisonment for two years along with a fine of Rs.5,000/- and in case of default, he was to undergo imprisonment for seven days and compensation to the tune of the amount of cheques only was awarded after the appeal or revision.

4. The petitioner filed an application under Section 389 (3) Cr.P.C. for suspension of sentence for enabling him to file an appeal against the judgment/order of sentence dated 23.01.2020. Vide order dated 23.01.2020 (Annexure P-4), the sentence of the petitioner was suspended for a period of one month i.e. upto 23.02.2020 subject to furnishing personal bonds in the sum of Rs.50,000/- to enable him to file an appeal, failing which, he shall be taken into custody to undergo the sentence.

5. Thereafter, the petitioner filed an appeal dated 17.02.2020 along with an application for suspension of sentence, against the above said judgment of conviction and order of sentence and the sentence of the petitioner was suspended by the Appellate Court during the pendency of the appeal, vide order dated 19.02.2020 till the disposal of the appeal and was ordered to be released on bail subject to furnishing personal bonds in the sum of Rs.30,000/- with one surety in the like amount.

6. Thereafter, an application dated 25.03.2022 under Section 148 of the Negotiable Instruments Act, was filed by the complainant/respondent for directing the accused/appellant to deposit the cheque amount as compensation before the Court as per latest amendment in the Negotiable Instruments Act. The petitioner/convict filed reply to the said application and finally vide impugned order dated 27.07.2022, the said application was accepted by the learned Additional Sessions Judge, Ludhiana and the petitioner/convict was directed that 20% of the compensation i.e. Rs.3,07,828/- i.e. 20% of Rs.15,39,142/- be paid on the next date of hearing i.e. 08.09.2022 and it was further clarified that in case, this amount is not paid then the bail order shall be cancelled and the convict shall be taken into custody. The next date fixed for hearing is 07.10.2022.

7. Feeling aggrieved against the said order, the petitioner has filed the present petition. I have heard learned counsel for the petitioner and have gone through records.

8. Learned counsel for the petitioner has submitted th