Interim Order 17

Order Details: COPY OF ORDER
Pdf Text: CC No. 1307/2021
SURJEET KUMAR V. ANIT KUMAR SINGH
05.01.2023
ORDER
1. Vide this order I shall decide the application of the complainant u/s. 143A of the
Negotiable Instruments Act, 1881. By way of this application, the complainant has prayed
for payment of 20% of the cheque amount as interim compensation.
BRIEF FACTS:
2. In a nutshell, it is the case of the complainant that he knows the accused from the
last 3-4 years and had met through a common friend, namely Mohd. Amaan Khan. Upon
the insistence of the accused and his friend Pankaj Singh, complainant invested money in
the liquor business of the said accused and received oral acknowledgement from him. That
accused had promised to give 50% profit on the invested amount of complainant and first
instalment towards the profit was to be made after 2 years i.e. somewhere around July
2019. Against the said investments, the accused handed over 4 cheques from his current
account for a total amount of Rs. 1,80,00,000/-. That in order to show his bonafide,
accused had handed over attested copies of his Aadhar card, PAN card, license of liquor
business etc. and had also executed an MoU admitting the receiving of huge payments
from the complainant. Accused had further executed an MoU in favour of complainant
stating that he had taken. Asper the assurances of the accused, complainant presented the
four cheques in dispute bearing no. 777192, 777185, 777182 and 314886 total amounting
to Rs. 1,80,00,000/- (Rupees One Crore Eighty Lakhs Only). Same came to be lastly
dishonoured for the reason “Payment stopped by drawer” vide separate return memos
dated 20.11.2020.
Page 1 of 7
-- 1 of 7 --
3. This was followed by a common legal demand notice dated 25.11.2020, however,
despite the service of the said notice, the accused failed to pay the amount of cheques in
dispute. Hence, the present complaint.
CONTENTIONS:
4. Ld. Counsel for the complainant submits that the complainant has suffered huge
losses and his livelihood is hugely dependent on the recovery from this case. Ld. Counsel
further submits that for deciding the present application, the court need not go into the
merits of the case. Hence, it is a fit case for granting of 20% of cheque amount as an
interim compensation. Ld. Counsel has placed reliance on the judgment of the Hon’ble
High Court of Chhatisgarh dated 30.06.2021, namely Rajesh Soni v. Mukesh Verma CRMP
No. 562/2021 (hereinafter referred to as ‘Rajesh Soni case’) in order to establish that the
word ‘may’ used in Sec. 143A NI Act be read as ‘shall’. That the provision is mandatory
and not discretionary in nature.
5. Per contra, the Ld. Counsel for the accused has prayed for dismissal of the
application on several counts-
i) That the accused never met the complainant or spoke to him (either physically or
telephonically) and denies having any kind of business transaction with him. Further,
the accused never issued the cheques in dispute to the complainant, hence, no cause
of action has arisen in favour of the complainant.
ii) That there is no existing legally enforceable liability towards the complainant and
in fact, the cheque book of the accused was stolen by a common friend of parties
herein, namely Mohd. Amaan Khan along with other signed letter heads and other
documents. That the cheque book of the accused along with other signed documents
Page 2 of 7
-- 2 of 7 --
of his business associates were kept in his car and Mohd. Amaan Khan had borrowed
the said car, however, never returned the same. That the signed cheques and signed
blank papers of the accused are being misused by Mohd. Amaan Khan through
various persons including the complainant by filing multiple litigation against the
accused and his business associates in different courts.
iii) That the accused has forged the acknowledgment letter by misusing the signed
blank paper of the accused.
iv) That the accused and his business associate/friend, Pankaj Singh Singh have
already filed separate criminal complaints with the concerned Police Station and also
u/s. 200 r/w Sec. 156(3) CrPC in the concerned Court against the said Mohd. Amaan
Khan as well as the complainant herein.
v) That on 21.09.2020, the accused instructed his bank to stop the payment of all the
cheques bearing no. 778031 to 778130.
vi) That the above-mentioned Pradeep Yadav has furnished a duly sworn affidavit
before the Police Authorities, Noida, U.P whereby he has stated that he has no
relation, personal or professional with the accused and that the accused owes no
liability towards him.
vii) Accused has placed reliance on the judicial decisions, namely, i) JSB Cargo and
Freight Forwarder Pvt Ltd. & Ors. v. State & Ors. (SCC OnLine Del 5425)
(hereinafter referred to as ‘JSB Cargo case’) and ii) LGR Enterprises & Ors. v. P.
Anbazhagan [2019 (3) MLJ (Crl) 423, High Court of Madras] (hereinafter referred
to as ‘LGR case’) to argue that the provision of Section 143A NI Act is not
Page 3 of 7
-- 3 of 7 --
mandatory as the Section 143A of the Act uses the word ‘may’, rather it is
discretionary in nature. That it is not necessary in every case to grant interim
compensation and reasons have to be spelled out if such compensation is ordered.
Documents perused. Arguments heard at length.
OBSERVATIONS AND REASONING:
6. Before proceeding to decide the present application, the Court deems it appropriate
to first discuss Section 143A of the Negotiable Instruments Act, 1881. Section 143A of the
Act was brought in the books by way of the Negotiable Instruments (Amendment) Act,
2018 w.e.f. 01.09.2018.
7. Section 143A of the Negotiable Instruments Act, 1881 reads as follows:
“143A – Power to direct interim compensation-
(1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2
of 1974), the 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 summon
case, where the drawer pleads not guilty to the accusation made in the complaint;
and (b) in any other case, upon framing of charges.
(2) The interim compensation under sub-section (1) shall not exceed twenty per cent
of the amount of the cheque.
(3) The interim compensation shall be pad within sixty days from the date of the
order under subsection (1), or within such further period not exceeding thirty days
as may be directed by the Courton sufficient cause being shown by the drawer of
the cheque.
Page 4 of 7
-- 4 of 7 --
(4) If the drawer of the cheque is acquitted, the Court shall direct the complainant
to repay to the drawer the amount of interim compensation, with interest at the bank
rate as published by the Reserve Bank of India, prevalent at the beginning of the
relevant financial years, within sixty days from the date of the order, or within such
further period not exceeding thirty days as may be directed by the Court on
sufficient cause being shown by the complainant.
(5) The interim compensation payable under this section may be recovered as if it
were a fine under section 421 of the Code of Criminal Procedure, 1973.
(6) The amount of fine imposed under section 138 or the amount of compensation
awarded under section 357 of the Code of Criminal Procedure, 1973 shall be
reduced by the amount paid or recovered as interim compensation under this
section.” This Amendment Act, 2018 was brought with a view to address the issue of
undue delay in final resolution of cheque dishonour cases so that immediate relief is
provided to innocent payees/complainant of dishonoured cheques.
8. The present application u/s. 143A NI Act has been moved in summary/summons trial
case and after framing of notice to which the accused has pleaded not guilty. Hence, the
requirements under the said provision are being fulfilled and the procedural compliance is
not in question.
9. The Hon’ble High Court of Delhi in JSB Cargo case (supra) has held that the Section
143A NI Act is discretionary in nature and that the trial court should satisfy itself on the
basis of cogent reasons to exercise the discretion in favour of the complainant. Further, it
has also been held in the LGR case (supra) that the provision of Section 143A NI Act is not
mandatory as the Section uses the word ‘may’.
Bare perusal of the section itself leaves no room for confusion as to its discretionary
nature as the usage of word ‘may’ is clear and distinct.
Page 5 of 7
-- 5 of 7 --
10. The purpose of the provision u/s. 143A NI Act is to provide relief to genuine
complainants during the pendency of the trial , however, it can also not be negated that the
section was introduced to address the issue of undue delay in final resolution of cheque
dishonour cases so as to provide compensation to the honest payees in the midst of long
trials.
In the case in hand, no undue delay can be attributable to the accused. Moreover, the
accused has raised probable defence in his reply to the present application. Accused has
submitted that he does not know the complainant, and has never had any conversation with
him. Further, he is not only denying the existence of the liability but is also submitting that
the cheques in dispute are stolen and are being misused by the complainant. He has also
attached the relevant documents inter alia, the copy of complaints before concerned Police
Station, instruction given to bank for stopping of payment of cheques, criminal complaints
filed before concerned courts, along with his reply to the present application. Per contra,
complainant has failed to produce the MoU allegedly executed by the parties wherein
accused had admitted receiving of huge sums from the complainant and in case of failure in
returning the said amount, complainant has the right to take possession of the shop and
school of accused and derive profit from there. Though the accused has admitted the
cheques in dispute and acknowledgment letter to the extent of signature only, however, the
defence raised by the accused inspires some amount of confidence which has resulted in the
Court exercising its discretionary power in his favour.
ORDER:
11. In the light of the above discussions, this Court is of the considered opinion that the
award of the interim compensation is not proper and would unduly burden the accused at
this stage of the proceedings.
Page 6 of 7
-- 6 of 7 --
12. Nothing in this order shall tantamount to any observation on the merits of the instant
case.
Accordingly, the present application stands disposed of.
(PADMA LANDOL)
MM (NI Act) Digital Court-03
New Delhi, PHC/Delhi/05.01.2023
Page 7 of 7
-- 7 of 7 --