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2023 Supreme(All) 2396

IN THE HIGH COURT OF ALLAHABAD
SURENDRA SINGH -I, J.
Avanish Kumar Gaur And Another - Petitioners
Versus
State of U.P. and Another - Respondents
MATTERS UNDER ARTICLE 227 NO. - 8690 OF 2023.
Decided On : 22-08-2023

Advocates appeared:
For the Petitioners: Krishna Kant Dubey,Santosh Kumar Dubey.
For the Respondents: G.A.,Dheeraj Kumar Singh.

Headnote:(A) Negotiable Instruments Act, 1881 - Section 138 and Section 143A - Interim compensation for dishonoured cheque - The Trial Court directed the petitioner to pay interim compensation of Rs.1,70,000/- (20% of the cheque amount), which the High Court found excessive and modified to Rs.85,000/- (10% of the cheque amount) to be paid within 60 days - The use of 'may' in Section 143A indicates that granting interim compensation is not mandatory and should be just and reasonable - The court emphasized that statements and evidence should be established during the trial. (Paras 9, 10, 11, and 8)

(B) Criminal Procedure - Judicial discretion - The court remarked that the Trial Court must act justly and not impose excessive interim compensation. (Para 9)

Table of Content
1. petition filed under article 227. (Para 1 , 2)
2. overview of the case and interim orders. (Para 3 , 4)
3. petitioner's and respondent's arguments. (Para 5 , 6)
4. court's analysis of compensation provisions. (Para 7 , 8 , 9)
5. modification of trial court's orders. (Para 10 , 11)
6. conclusion and further proceedings ordered. (Para 12 , 13 , 14)

JUDGMENT

Surendra Singh-I, J.

The instant petition under Article 227 of the Constitution has been preferred with a prayer to set aside the order dated 24.07.2023 passed by the Sessions Judge, Ghaziabad in Criminal Revision No. 463 of 2023, Avnish Kumar Gaur v. State of U.P. and another as well as order dated 23.05.2023 passed by the Presiding Officer, Additional Court, Court No. 2, Ghaziabad in Complaint Case No. 1179 of 2022, Samleshwar v. Avnish Kumar and others, under section 138 of Negotiable Instruments Act, 1881 (hereinafter referred to as "N.I. Act"), Police Station Sahibabad, District Ghaziabad.

2. Heard Shri Santosh Kumra Dubey, learned counsel for petitioners, Shri Dheeraj Kumar Singh, learned counsel appearing on behalf of opposite party no. 2 and the learned A.G.A. appearing on behalf of the State.

3. As per averments made in the petition, the above mentioned complaint case was filed by respondent no. 2 against the petitioner under section 138 of N.I. Act about dishonouring of cheque. The petitioner was summoned vide order dated 30.11.2021 for trial under Section 138 N.I. Act. The Trial Court vide order dated 23.05.2023 directed the petitioner/accused, under section 143A of the N.I. Act, to pay Rs. 1,70,000/- (20% of the value of cheque) to the complainant as interim compensation within 60 days, subject to the condition mentioned in clause (4) of section 143A of the N.I. Act.

4. A revision has also been filed against the aforesaid order passed by the Trial Court whereby the learned Sessions Judge, Ghaziabad vide order dated 24.07.2023 rejected the criminal revision at the admission stage on the ground that the Magistrate has passed just and proper order under the provisions of section 143A N.I. Act.

5. It has been submitted by the learned counsel for the petitioner that the impugned orders passed by the Trial Court as well as the Revisional Court are wholly illegal and against the provisions of law. It has also been submitted that the Trial Court has passed the order at the initial stage of the proceeding whereas neither statement charge has been recorded against the accused nor any evidence has been adduced by the complainant in the case.

6. Learned counsel for opposite party no. 2/complainant as well as learned A.G.A. for the State have opposed the petition and submitted that the Trial Court has rightly passed the impugned order as per the provisions of section 143A N.I. Act and, therefore, there is no ground to interfere in the impugned order.

7. Against the dishonoured cheques of total value of Rs. 8,50,000/-, which were allegedly given by accused to the complainant in discharge of a debt, the Trial court vide order dated 23.05.2023 passed under section 143A of N.I. Act had directed the accused/petitioner to pay 20% of this amount i.e. Rs. 1,70,000/- as interim compensation to the complainant. The provisions of section 143A of N.I. Act reads as follows:

    "143A. Power to direct interim compensation. -

    (1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973, the Court trying an offence under section 138 may order the drawer of the cheque to pay interim compensation to the complainant-

    (a) in a summary trial or a summons case, where he pleads not guilty to the accusation made in the complaint; and

    (b) in any other case, upon framing of charge.

    (2) The interim compensation under sub-section (1) shall not exceed twenty percent of the amount of the cheque.

    (3) The interim compensation shall be paid within sixty days from the date of the order under sub-section (1), or within such further period not exceeding thirty days as may be directe

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