Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2024 Supreme(SC) 1331

SUPREME COURT OF INDIA
DIPANKAR DATTA, PRASHANT KUMAR MISHRA, JJ.
Muskan Enterprises & Anr. - Appellants
Versus
The State Of Punjab & Anr. - Respondents
Criminal Appeal No. 5491 of 2024 [Arising out of SLP (Crl.) No. 8072/2024]
Decided on : 19-12-2024

Advocates appeared:
For the Petitioner(s): Ms. Shumaila Altaf, Adv. Mr. Harvinder Singh Mann, Adv. Mr. Sakib Altaf, Adv. Mr. Abhimanue Shrestha, AOR
For the Respondent(s): Mr. Mohd Irshad, A.A.G. Mr. Karan Sharma, AOR Mr. Dilpreet Singh Gandhi, Adv. Mr. Nishant Bishnoi, AOR Ms. Srishti Prabhakar, Adv. Mr. R. C. Goutam, Adv.

The Appellate Court has discretion under Section 148 of the N.I. Act to waive the deposit requirement in exceptional cases, contrary to previous interpretations.

Headnote:(A) Negotiable Instruments Act, 1881 - Section 138 - Code of Criminal Procedure, 1973 - Section 482 - Conviction under Section 138 upheld by trial court with compensation ordered - High Court dismissed subsequent petition on grounds of maintainability after earlier withdrawal - Court found dismissal unjustified, emphasizing the distinction between civil and criminal procedural laws and the maintainability of successive petitions. (Paras 10, 14, 20, 28)

(B) Interpretation of Statutes - Legislative intent in using 'may' and 'shall' in Section 148 - Court clarified that 'may' implies discretion for appellate courts to waive deposit in exceptional cases, while 'shall' mandates a minimum deposit of 20%. (Paras 24, 27)

Facts of the case:
The appellants were convicted under Section 138 of the N.I. Act and ordered to pay substantial compensation. They challenged the requirement to deposit 20% of the compensation pending appeal, which was upheld by the High Court based on prior case law.

Findings of Court:
The High Court's dismissal of the subsequent petition was found to be legally unsustainable, and the matter was remitted to the Sessions Court for reconsideration of the deposit requirement.

Issues: Whether the High Court was justified in dismissing the subsequent petition based on the withdrawal of the earlier petition without leave.

Ratio Decidendi: The court ruled that procedural laws differ between civil and criminal contexts, and the principle of res judicata does not apply to criminal proceedings, allowing for successive petitions under Section 482.

Result: Appeal allowed; matter remitted to Sessions Court.

JUDGMENT :

DIPANKAR DATTA, J.

1. Leave granted.

2. The judgment and order dated 18th May, 2024, passed by a learned Judge of the High Court of Punjab and Haryana at Chandigarh¹[High Court] dismissing a petition²[CRM-M-25041-2024] under Section 482 of the Code of Criminal Procedure, 1973³[Cr. PC] preferred by the appellants is under assail in this appeal.

3. The basic facts are not in dispute.

4. Conviction for offence punishable under Section 138 of the Negotiable Instruments Act, 1881⁴[N. I. Act] had been recorded against the appellants by the Judicial Magistrate, 1st Class, Amloh, District Fatehgarh⁵[trial magistrate] vide judgment and order dated 15th September, 2022. Consequently, the second appellant (the proprietor of the first appellant) was sentenced to 2 years’ rigorous imprisonment; also, under Section 357(3), Cr. PC. they were directed to pay compensation of Rs.74,00,000/- (double the cheque amount) to the complainant who was given the liberty to recover the same from the appellants.

5. The conviction and sentence, as aforesaid, were carried in appeal by the appellants before the Sessions Court, Fatehgarh Sahib⁶[Sessions Court ]. While admitting the appeal by order dated 17th October, 2022, the Sessions Court suspended the sentence till disposal of the appeal. The second appellant was granted bail. Additionally, the Sessions Court directed the appellants to deposit 20% of the compensation amount awarded by the trial magistrate within a period of sixty days in the court below, being of the view that such a deposit (of 20%) was imperative. The complainant was given liberty to withdraw the deposit subject to furnishing an undertaking that the same would be returned, if the appellants succeeded in the appeal.

6. Imposition of such condition by the Sessions Court for deposit of 20% of the compensation awarded by the trial magistrate was questioned by the appellants before the High Court in a petition⁷[CRM-M-21715-2023] filed under Section 482, Cr. PC.

7. The said petition was considered by the High Court on 01st May, 2023, i.e., at a point of time when the decision of this Court in Surinder Singh Deswal @ Col. S. S. Deswal vs Virender Gandhi, 2019 (11) SCC 341 was governing the field on interpretation of Section 148 of the N.I. Act. The said decision held the condition for deposit in terms of Section 148, N.I. Act as mandatory.

8. Learned counsel appearing for the appellants had argued for some time. However, having found that his arguments would yield no fruitful result since the High Court was bound by the ratio of the decision in Surinder Singh Deswal (supra), he made a statement that the appellants would withdraw the petition. Accordingly, an order was passed to the effect that the petition stands dismissed as withdrawn.

9. Close on the heels of dismissal of the said petition of the appellants, as withdrawn, came the decision of another coordinate bench of this Court in Jamboo Bhandari v. Madhya Pradesh State Industrial Development Corporation Ltd. and ors., (2023) 10 SCC 446. Upon consideration of the law laid down in Surinder Singh Deswal (supra), the bench in Jamboo Bhandari (supra) proceeded to hold as follows: -

7. Therefore, when Appellate Court considers the prayer under Section 389 of the Cr. P.C. of an accused who has been convicted for offence under Section 138 of the N.I. Act, it is always open for the Appellate Court to consider whether it is an exceptional case which warrants grant of suspension of sentence without imposing the co