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IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
Karamjit Singh, J.
Dagdish Singh – Appellant
Versus
Rajinder Pal Singh – Respondent
CRM-M- No. 50569 of 2022
Decided On : 29-11-2022
Negotiable Instruments Act - Interim Compensation - Section 143A - 143A(1), 143A(1)(a)
Fact of the Case:
The petitioner sought quashing of an order directing him to deposit 20% of the cheque amount towards interim compensation to the complainant under Section 143(A) of Negotiable Instruments Act.
Finding of the Court:
The court found that the provision of Section 143(A) is discretionary and not mandatory, and the impugned order was passed in a casual manner without proper application of mind.
Issues: The issue was whether the petitioner should be directed to pay interim compensation under Section 143(A) of Negotiable Instruments Act.
Ratio Decidendi: The court held that Section 143(A) is essentially directory and cannot be termed as mandatory in nature, and the impugned order was non-speaking and contrary to the settled position of law.
Final Decision: The impugned order was set aside, and the matter was remanded back to the Trial Court to dispose of the issue regarding grant of interim compensation to the complainant/respondent under Section 143A, in accordance with law within one month of the receipt of certified copy of this order.
JUDGMENT
Karamjit Singh, J. - The present petition has been filed by the petitioner seeking quashing of the order dated 24.08.2022 (Annexure P-2) passed by Ld. JMIC, Patiala, in complaint case COMA No.2592 of 2020 dated 22.10.2020, Rajinder Pal Singh Vs. Dagdish Singh, to the extent whereby the said Court directed the petitioner to deposit 20% of cheque amount towards interim compensation to the complainant, as per the provisions of Section 143(A) of Negotiable Instruments Act.
2. The brief facts of the case are that respondent Rajinder Pal Singh has filed aforesaid complaint against the present petitioner under Section 138/142 of Negotiable Instruments Act. On the completion of preliminary evidence, the petitioner was summoned and he appeared before the Trial Court and was granted bail. The Trial Court on 24.08.2022 passed the following order:-
'Present: Surinder Gera, Advocate for complainant.
Accused on bail with Sh. Kamna Kumar, Jain, Advocate.
Today case was fixed for serving notice of accusation upon accused. Before proceeding further, I have explain to both the parties regarding mediation and other alternative mode of resolution. It has been also explained that if accused makes the payment of the cheque amount then alongwith costs, as assessed, if any, matter it hand can be compoundable. But accused is adamant to pursue the matter on merits.
Heard. Finding prima facie case, notice U/s 138 of NI Act has been served upon the accused to which he pleaded not guilty and he wants to defend the case of the complainant and he desires to cross examine the complainant's witness. Since fairly point is involved, therefore, leave to defend is granted to the accused. Accused has received copies of complaint and other documents.
After considering the defence of the plea taken by the accused, averments made in the complaint and the cheque amount involved in the present complaint, I am of the considered view that the present case should be treated as summons case. Therefore, let procedure prescribed for the summon trial be adopted.
Further, as per amendment of law with regard to NI Act, in case wherein accused pleads not guilty and claim trial, interim compensation is to awarded. For that, the latest position of law is to be seen, which provides that, as reproduced alongwith relevant provisions;
" The NI (Amendment) Act, 2018 No. 20/2018 which came into force on 02.08.2018 provides that in the NI ACt, 1881, (herein referred to as principal act), after Section 143 the following Section shall be inserted:-
143A (1) notwithstanding anything contained in the Code Criminal Procedure 1973, the Court trying An offence under Section 138 order the drawer of the cheque to pay the interim compensation to the complainant.
143 A (1) (a) reads as under:-
" In a summary trial or in summon case, where he pleads not guilty to the accusation made in the complaint and in any other case, upon framing of charge."
The afore mentioned amendment clearly provides for provisions of interim compensation, which is to be imposed upon accused, who pleaded not guilty to accusation made in the complaint and it is be noted that it must not exceed 20% of the cheque amount and shall be paid within 60 days from the date of order or within such period not exceeding 30 days alongwith other conditions as mentioned above. Further, the Hon'ble Supreme Court in case titled as G.J Raja Vs. Tejraj Surana 2019 (3) CCC 613 SC has held that provisions of 143A of NI Act came into force on 01.09.2018 and have prospective effect and interim compensation can be order to be paid if the offence was committed after the introduction of the said provision. So, in the present case the amount of interim compensation to the tune of 20% of cheque amount to be paid on or before 19.09.2022 and for cws.
Date of Order: 24.08.2022
Sd/
JMIC, Patiala'
3. The petitioner has not challenged the aforesaid order to the extent whereby notice of accusation was served upon him. However, he being aggrieved of the order passed b
The main legal point established in the judgment is that the provision of Section 143(A) of the Negotiable Instruments Act is directory in nature and not mandatory, and the trial court's order direct....
Discretionary orders under Section 143 A (1) of the Negotiable Instruments Act must be supported by reasons, as orders without reasons are illegal and subject to being set aside.
The discretion to grant interim compensation under Section 143-A of the NI Act must be supported by reasons and should be based on well-recognized principles.
Whenever a discretionary power is to be exercised by Court, same has to be exercised on well-recognized principles supported by reasons.
The court established that interim compensation under Section 143A of the N.I. Act requires careful consideration of the merits of the case and the provision's discretionary nature, necessitating a r....
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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