Government has sanctioned the above Bill and may come up in present on-going monsoon session for consideration.
Highlights of Bill
Section 143 A is inserted after section 143, the following section shall be inserted, namely:—
‘‘143A (1) Notwithstanding anything contained in the Code of Criminal
Procedure, 1973, 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
the accusation 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.
(3) The interim compensation shall be paid within sixty days from the date of the order under sub-section (1), or within such further period not exceeding thirty days as may be directed by the Court on sufficient cause being shown by the drawer of the cheque.
(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 year, 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.’’.
- In the principal Act, after section 147, the following section shall be inserted,namely:—
‘‘148. (1) 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.
(2) The amount referred to in sub-section (1) shall be deposited 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 appellant.
(3) The Appellate Court may direct the release of the amount deposited by the appellant to the complainant at any time during the pendency of the appeal:
Provided that if the appellant is acquitted, the Court shall direct the complainant
to repay to the appellant the amount so released, with interest at the bank rate as published by the Reserve Bank of India, prevalent at the beginning of the relevant financial year, 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.’’.
Comments on the proposed amendment Bill:
It’s a good provision directing drawer of cheque to deposit not more than 20% of cheque amount as compensation. We see in courts, that creditor drags matter and avoid payment. Issue and service of summons takes virtually one year and another six months for effecting service of proceedings. This procedure sometimes takes more if court is vacant or there are clerical and technical objections. Service by Register Post comes back with remark ‘left’, that Advocate has to hunt for whereabouts of the creditor/drawer of cheque and it becomes difficult to serve summons. Then comes news paper advertisements, which costs not less than 10 to 50 thousand depending upon the newspaper available.
After this if drawer of cheque comes and attends, than he pleads not guilty and matter goes on for nearly 5 to 7 years. Followed by Appeal to various higher courts. Our judicial set up is such that Complainant/Plaintiff is treated as “criminal” and the defendant/accused always gets benefit of doubt. So till finality upto Supreme Court orders may be reversed. This is called “mens rea” It’s a Latin term which means “Guilty Mind”. The Complainant/Plaintiff/Prosecution has to prove beyond doubt the guilty mind of accused/respondent/defendant. “guilty mind” is the mental element of a person’s intention to commit a crime; or knowledge that one’s action or lack of action would cause a crime to be committed. It is a necessary element of many crimes. As a general rule, someone who acted without mental fault is not liable in criminal law, except horrendous crimes. This gives confidence to the wrongdoers to escape from clutches of law.
This is a good amendment. Economic crimes are worst than murder. Here the lender dies every minute, and entire family pays price. It creates social turmoil and affects the thread of trust in society.
Yet one problem is the drawer of cheque escapes to other country!!! It happens several times, in one of our matter a lady had issued several cheques of total amount of Rs.13 crore. When 138 proceedings were filed we came to know she is in USA. In such case it becomes very difficult to recover money. Such persons run their business on leave and license and even residence is not permanent. I doubt with this amendment too, such cases will be benefitted !!!.
Statement of Object and Reasons
STATEMENT OF OBJECTS AND REASONS
The Negotiable Instruments Act, 1881 (the Act) was enacted to define and amend the law relating to Promissory Notes, Bills of Exchange and Cheques. The said Act has been amended from time to time so as to provide, inter alia, speedy disposal of cases relating to the offence of dishonour of cheques. However, the Central Government has been receiving several representations from the public including trading community relating to pendency of cheque dishonour cases. This is because of delay tactics of unscrupulous drawers of dishonoured cheques due to easy filing of appeals and obtaining stay on proceedings. As a result of this, injustice is caused to the payee of a dishonoured cheque who has to spend considerable time and resources in court proceedings to realise the value of the cheque. Such delays compromise the sanctity of cheque transactions.
- It is proposed to amend the said Act with a view to address the issue of undue delay in final resolution of cheque dishonour cases so as to provide relief to payees of dishonoured cheques and to discourage frivolous and unnecessary litigation which would save time and money. The proposed amendments will strengthen the credibility of cheques and help trade and commerce in general by allowing lending institutions, including banks, to continue to extend financing to the productive sectors of the economy.