LexM/S. METERS AND INSTRUMENTS PRIVATE LIMITED & ANR. versus KANCHAN MEHTA
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[2017] JO S.C.R. 66 A M/S. METERS AND INSTRUMENTS PRIVATE LIMITED & B c ANR. v. KANCHAN MEHTA (Criminal Appeal No. 1731 of 2017) OCTOBER 5, 2017 [ADARSH KUMAR GOEL AND UDAY UMESH LALIT, JJ.] Negotiable Instruments Act, 1881: ss. 138, 147 - Compounding" the offence under s. 138 on payment of cheque amount and in alternative for exemption from ·personal appearance - Permissibility - Question is how the proceedings for offence under s. 138 can be regulated where accused . is willing to deposit the cheque amount - Held: Where the cheque D amount with interest and cost as assessed by the Court is paid by a specified date, the Court is entitled to close the proceedings in exercise of its powers under s.143 of the Act read with s.258 Cr.P.C. - The normal rule for trial of cases under Chapter XV/l of the Act is to follow the .rnmmary procedure and the summons trial procedure E F can be followed where sentence exceeding one year may be necessary taking into account the fact that compensation under s.357(3) Cr.P.C. with sentence of less than one year will not be adequate, having regard to the amount of cheque, conduct of the accused and other circumstances - !11 every summon:1-, issued to the accused, it may be indicated that if the accused deposits the specified amount, which should be assessed by the Court having regard to the cheque amount and interest/cost, by a specified date, the accused need not appear unless required and proceedings may be closed subject to any valid objection of the complainant. s. 138 - Object of legislation - Held: The object of introduCing s. 138 and other provisions of Chapter XVII in the Act in the year G 1988 was to enhance the acceptability of cheques in the settlement of liabilities - The drawer of cheque is made liable to prosecution 011 dishonour of cheque with safeguards to prevent harassment of honest drawers - The object of the provision is both punitive as well as compensatory - The intention of the provision is to ensure H that the complainant received the amount of cheque by way of 66 MIS. METERS AND INSTRUMENTS PRIVATE LIMITED & 67 ANR. v. KANCHAN MEHTA compensation - Though proceedings under s.138 could not be A treated as civil suits for recovery, the scheme of the provision, providing for punishment with imprisonment or with fine which could extend to twice the amount of the cheque or to the both, makes the intention of law clear - The complainant could be given not only the cheque amount but double the amount so as to cover interest and costs. B s.138 - Affidavit evidence - Reliability of - Held: Since evidence of the co111plaint can be given 011 affidavit, subject to the Court swnmoning tlze person giving affidavit and examining hi111 and the bank'.~ slip being pri111a facie evidence of the dishonor of c cheque, it is unnecessary for the Magistrate to record any further preliminary evidence - Such affidavit evidence can be read as evidence at all stages of trial or other proceedings - The manner of examination of the person giving 4fidavit can be as per s.264 C1: P. C. - The scheme is to follow summary procedure except' where exercise of power under second proviso to s.143 becomes nec:essary, D where sentence of one year may have to be awarded and compensation under s.357( 3) is considered inadequate, having regard to the amount of the cheque, the financial capacit); and the conduct of the accused or any other circumstances. Criminal law: Compounding of offence .,... Held: Though E compounding requires consent of both the ,parties~ even in absence of such consent, the Court, in the interests of justice, on being satisfied that the complainant has been duly co111penrnted, can in · its discretion close the proceedings and discbarge tl_ie accused. Code of Cri111inal Procedure, 1973: F s.357(/)(b) - Scope of, in case of cheque dishonour cases - Held: s.357( l)(b) provides for payment of compensation for the loss caused by the offence out of the ji'ne - Where fine is not imposed, compensation can be awarded under s.357(3) to the person who suffered loss - Sentence in default can also be imposed - The object 0 of the provision is not merelv penal but to make the accused honour the negotiable instruments - In view of the above scheme, the accused could make an application for compounding at the first or second hearing in which case the Court ought to allow the same - lf such · application is made late
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