In this writ petition, the petitioner has sought for the

relief of striking down Section 143A of the Negotiable

Instruments (Amendment) Act, 2018 as ultra vires the

Constitution of India.

2.

Facts giving rise to filing of this appeal briefly

stated are that the petitioner had issued a cheque in favour

of respondent No.2. However, on presentation of the

cheque, the same was dishonored. Thereupon, the

respondent No.2 issued a notice dated 16.01.2019 to the

petitioner. The petitioner submitted a reply to the aforesaid

notice on 30.01.2019. Thereafter, the respondent No.2 filed

a complaint under Section 138 of the Negotiable Instruments

Act, 1881 (hereinafter referred to as 'the Act' for short).

During the pendency of the proceedings, the respondent

No.2 filed an application under Section 143A(2) of the Act, in

which a prayer was sought to deposit 20% of the amount.

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The petitioner filed objections to the aforesaid application.

The trial court by an order dated 30.10.2019 allowed the

application preferred by respondent No.2 and directed the

petitioner to deposit 10% of the amount in question. In the

aforesaid factual background, this petition has been filed.

3.

Learned counsel for the petitioner submitted that

Section 143A of the Act is violative of Articles 14 & 19 of the

Constitution of India. It is also submitted that the holder of

the cheque is required to deposit the amount without trial

and in case of default of payment of the amount as ordered

by the Court under Section 143A of the Act, the holder of the

cheque may be sent to jail and therefore, Section 143A

deserves to be struck down. On the other hand, learned

Central Government Counsel has submitted that Section

143A(2) does not suffer from any infirmity.

4.

We have considered the submissions made on

both sides and have perused the record. Section 143A deals

with power of court to direct interim compensation. The

aforesaid provision, which has been inserted by Negotiable

Instruments (Amendment) Act, 2018 with effect from

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01.09.2018 inter alia provides that the court trying an

offence under Section 138 of the Act, may order the drawer

of the cheque to pay interim compensation to the

complainant in a summary trial or summons case where he

pleads not guilty to the accusation made in the complaint on

any case upon framing of the charge. The interim

compensation so payable shall be such sum not exceeding

20% of the amount of the cheque.

5.

The Supreme Court in ‘J.G.RAJA VS. TEJRAJ

SURANA’, AIR 2019 SC 3817 has held that the provisions

of Section 143A of the Act are prospective in nature and can

be invoked only in cases where the offences under Section

138 of the Act was committed after introduction of Section

143A in the statute book.

6.

It is trite law that the validity of the provision can

be challenged only on twin grounds viz., legislative

incompetence or on a ground that the provision violates any

of the rights conferred by Part III of the Constitution of India.

In the instant case, undoubtedly the parliament has power to

enact Section 143A of the Act. So far as the contention that

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Section 143A of the Act violates the mandate contained in

Article 14 of the Constitution of India is concerned, it is

pertinent to note that Section 143A of the Act is not

mandatory in nature. However, a discretion is conferred on

the court to pass an order directing payment of interim

compensation in appropriate cases which shall not exceed

20%.

7. The provision also takes into account the eventuality

that in case, the drawer of the cheque is acquitted and in

such a case, the court has the power to direct the

complainant to repay the amount of interim compensation

with interest at such bank rate as published by the Reserve

Bank of India, prevalent at the beginning of the financial

year, within sixty days from the date of the order. Thus,

incase of acquittal of the drawer of the cheque, his interests

are protected under Section 143A(4) of the Act. So far as the

contention th