The Amendment No. 20 of 2018 to the Negotiable Instrument Act, 1881(N.I.) where challenged by a bunch of 14 petitions against the orders passed by the Trial Courts under Section 143- A and orders passed by Appellate Courts under Sec. 148 of the N.I. Act.
Section 143 A (1) and 143 A (2) of the N.I. Act, Reads: -
“143-A. Power to direct interim compensation---
(1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973(2 of 1974), 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 theaccusation 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 per cent of the amount of the cheque.”
Section 143-A of the N.I. Act, provides power to the trial court to grant interim compensation up to 20% of the cheque amount to the Complainant.
On the other hand Section 148(1) of N.I. Act, is read as follow: -
‘‘148. Power of Appellate Court to order payment pending appeal against conviction------
- Notwithstanding anything contained in the Code of Criminal Procedure, 1973, in an appeal by the drawer against conviction under section 138, the Appellate Court may order the appellant to deposit such sum which shall be a minimum of twenty per cent. of the fine or compensation awarded by the trial Court:
Provided that the amount payable under this sub-section shall be in addition to any interim compensation paid by the appellant under section 143A.”
Here, Section 148 of the N.I. Act, empowers the Appellate court to direct the Accused to deposit a minimum of 20% of the fine or compensation awarded by the Trial Court.
The challenge raised by the petitioners before the HC of Punjab and Haryana was that since the Amendment Act has been enforced with effect from 02.08.2018, therefore. These provisions cannot be made applicable to the cases, where the trials for an offence under Sec. 138 of the N.I. Act was already pending or where the appeals have arisen from such trials, which were already pending on the date of enforcement of these provisions.
The HC bench by answering the questions in respect to Sec. 143-A held that “Since the amended provision provides for enforcement of recovery of interim compensation by way of coercive procedure, it is nothing but an obligation imposed upon the accused and if not paid, making him subject to legal deprivement/disability to his properties. Therefore, it has to be held that Section 143-A of the Act cast a substantive obligation upon the accused and thereby effect the substantive right of the accused. Since the Amendment Act has not made the provision applicable retrospectively, specifically, to pending cases, hence, it cannot be applied retrospectively, to pending cases; which arose from the default of the accused which has taken place before coming into force of this provision.”
The bench going by the reasoning that as no such similar provisions existed prior to the amendment of N.I. Act if applying the provision retrospectively would lead to totally devastating, irrecoverable and irreparable damages to the accused. Therefore, this provision can at the best be applicable prospectively where prospective accused would be aware of such consequences in advance, and it cannot be applied to the cases where the trial has already commenced.
However, by giving a contrary judgment in respect to Sec. 148 of the N.I. Act, court observed “Since the provisions for recovery of fine or compensation from the appellant already existed in the existing procedure relating to the recovery, therefore, the provision introduced vide Section 148 of the Act; which relates only to recovery of amount partly, as interim measure, has to be treated purely procedural only, which is otherwise also beneficial for the appellant as compared to the pre-existing provisions. Hence it has to be held that provision of Section 148 of the Act shall govern all the appeals pending on the date of enforcement of this provision or filed thereafter."
Justice Rajbir Sehrawat said that the provision similar to Sec. 148 of the N.I. Act already existed in Cr.P.C before the advent of the Sec. 148 of the Act. The amendment gives more breathing space to the convict as compared to other procedures of recovery, as contemplated under Sec. 421 and 424 of Cr.P.C., which is far more onerous in terms of the time limit and the consequence.
The Punjab and Haryana High Court in the judgment held that the Section 143A of the Negotiable Instruments Act has no retrospective effect whereas the Section 148 will apply to the pending appeals pending on the date of enforcement of this provision.
Courtesy/By: Jayant Upadhyay
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14 Apr 2019
