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2004 DIGILAW 161 (KER)

Jameela v. State of Kerala

2004-04-02

A.K.BASHEER

body2004
Judgment :- Can a criminal court remit any portion of the penalty or enforce only its part payment under Section 446 (3) of the Code of Criminal Procedure 1973 pursuant to forfeiture of the surety bond and after steps for recovery of penalty have been initiated? The above short but interesting question has arisen in the following circumstances. 2. Petitioners executed surety bonds to bail out an accused who was facing trial in the court for an offence punishable under Section 138 of the Negotiable Instruments Act. Subsequently the accused failed to appear before the court. Coercive steps were initiated against him. Though notices were issued to the petitioners/sureties, they failed to procure attendance of the accused before the court. Therefore the surety bonds were forfeited and the petitioners were directed to pay Rs.5,000/- each as penalty. The order imposing the penalty was passed by the learned Magistrate after issuing show cause notice to the sureties and after hearing them as provided under Section 446 (1) of the Code. The above order was passed on July 26, 2001. 3. The amount of penalty was not paid by the petitioners. Therefore recovery proceedings were initiated against them as provided under the Kerala Revenue recovery Act. Annexure A and B are true photocopies of the notices issued to them under the Act. 4. However, in the meanwhile there was another development. It appears that the accused either re-surfaced by himself or he was produced before the court. The case pending against him was settled between the parties. The accused was acquitted under section 256 of the Code. In the above circumstances an application was filed by the petitioners before the learned Magistrate with a prayer that “a major portion of the penalty” may be remitted and only a part payment be enforced. The learned Magistrate dismissed the above application by Annexure D order dated November 21, 2001, which has been impugned in this case filed under Section 482 of the Code. 5. Learned counsel for the petitioners submits that clause (3) of Section 446 of the Code empowers the Court “to remit any portion of the penalty” and to enforce only part payment thereof. According to the learned counsel the discretion vested with the court can be exercised at any stage and even after the order imposing the penalty has been passed, but of course before recovery has been effected. 6. According to the learned counsel the discretion vested with the court can be exercised at any stage and even after the order imposing the penalty has been passed, but of course before recovery has been effected. 6. Chapter XXXIII of the Code deals with provisions relating to bail and bond. Section 440 under the above chapter provides that the “amount of every bond executed under this chapter shall be fixed with due regard to the circumstances of the case and shall not be excessive”. The Police Officer or the Court, as the case may be, is empowered to fix the quantum of money for the bond to be executed by the accused and his sureties, if any, for releasing him on bail. The number of sureties can also be at the discretion of the officer or the court. The bond shall of course contain the conditions if any that are to be imposed. Sufficiency or fitness of the sureties is subject to the satisfaction of the Court. Sub-section (4) of Section 441 states that the Court may accept affidavit in proof of fitness or sufficiency of the sureties and may even hold an enquiry if it chooses to do so. The bond executed by the accused and the sureties are liable to be forfeited, if any of the terms or conditions in the bond is violated. 7. As mentioned earlier, the petitioners were directed to show cause why penalty should not be imposed on them for their failure to produce the accused before the court on the date fixed for hearing. Sub-section (2) of Section 446 provides that if the sureties do not show sufficient cause and they do not pay the penalty imposed on them, the Court may proceed to recover the same as though it is a fine imposed by the Court under the Code. If recovery becomes impossible, the sureties are liable to suffer imprisonment in civil jail for a term which may extend to six months. 8. There is no dispute that sub-section (3) of Section 446 empowers the Court to use its discretion to remit any portion of the penalty and enforce payment of only part of the penalty. If recovery becomes impossible, the sureties are liable to suffer imprisonment in civil jail for a term which may extend to six months. 8. There is no dispute that sub-section (3) of Section 446 empowers the Court to use its discretion to remit any portion of the penalty and enforce payment of only part of the penalty. Clause 3 of Section 446 reads as hereunder: “(3) The Court may, at its discretion, remit any portion of the penalty mentioned and enforce payment in part only” It is true that the above provision does not specify at what stage the court can remit the penalty. But the preceding clauses make it clear that the Court can impose penalty only after recording proof of forfeiture and after issuing show cause notice. 9. The short questions are: (1) Can the court which forfeits the bond of the surety remit or order part payment of the penalty after imposing such penalty? (2) Can the criminal court re-open or review its earlier order of imposition of penalty to invoke the power of discretion as provided under sub-section (3) of section 446? 10. On a perusal of the provisions in Section 446, it is evident that a bond which has been executed either for appearance of accused or production of property shall be forfeited the moment it is proved that a condition in the bond has been violated. For instance, if the accused fails to appear on the day on which he has been directed to appear, the Magistrate is empowered to forfeit the bond of the accused as well as that of the sureties forthwith. Of course, the court must be satisfied that the condition in the bond has been violated. Thus it can be seen that the power vested with the court to forfeit the bond is unfettered. However clause (1) of Section 446 provides that the court shall record the grounds of proof of forfeiture. Thereafter the Court may call upon any person bound by such bond to pay the penalty or to show cause why it should not be paid. Thus clause (1) of Section 446 clearly indicates that the forfeiture of a bond for breach of any of the conditions is almost an inevitable or automatic consequence. It is then for the surety to explain the reasons for the breach. Thus clause (1) of Section 446 clearly indicates that the forfeiture of a bond for breach of any of the conditions is almost an inevitable or automatic consequence. It is then for the surety to explain the reasons for the breach. Clause (2) of Section 446 stipulates that if sufficient cause is not shown and the penalty is not paid the court may proceed to recover it. The proviso to clause (2) deals with the consequences of failure to pay the penalty. The person who is bound as surety is liable to suffer imprisonment in civil jail if he fails to pay the penalty imposed. 11. A reading of the above two clauses of Section 446 clearly shows that forfeiture of the bond and payment of penalty would follow as a natural consequence for breach of any of the conditions for the bond. The quantum of penalty may be the entire amount covered under the bond or it may be as decided by the Court after hearing the surety. It is provided in clause (1) that “the court may call upon any person bound by such bond to pay the penalty thereof or to show cause why it should not be paid”. (emphasis supplied). Nevertheless, the court can exonerate the surety from payment of penalty, if it is satisfied that there are valid reasons for the failure to produce the accused or the property. The court can exercise its discretion in the matter after hearing the surety. The court can remit any portion of the penalty and direct the surety to pay only a portion thereof. 12. But incidentally, it may be noticed that by the subsequent introduction of Section 446-A in the Code, the situation is slightly different. If the bond is executed for appearance of an accused and the bond is cancelled due to his failure to appear then the court can forfeit the bond. His release can be ordered “upon the execution of a fresh, personal bond … with one or more of such sureties.” No penalty is envisaged under Section 446-A. More importantly the provisions contained in Section 446-A are “without prejudice to the provisions of Section 446.” 13. However, the question that has arisen in this case is at what stage the court can use its discretion to remit a portion of the penalty if the bond is cancelled under Section 446. However, the question that has arisen in this case is at what stage the court can use its discretion to remit a portion of the penalty if the bond is cancelled under Section 446. Evidently the court which forfeits the bond has to necessarily consider all facts and circumstances before imposing the penalty. There may be situations where the accused might have been prevented from appearance in Court due to valid reasons beyond his control. Instances may be numerous and variegated depending on factual situations which cannot be enumerated. But the crucial issue is to find out whether the accused had failed to appear before the Court for genuine and justifiable reasons and also whether the sureties were at fault in failing to procure the attendance of the accused. All the attendant circumstances have to be considered by the Court while imposing the penalty consequent on the forfeiture. Question of remission of penalty or enforcement of payment only in part is also to be considered at that stage. In my view, the discretion has to be exercised at the time when the penalty is imposed and not at any later stage. In that view of the matter, the order impugned cannot be faulted. 14. But learned counsel for the petitioners submits that the court can exercise the power of discretion at any stage. He places reliance on a few reported decisions in support of his contention. 15. In Balraj S. Kapoor v. State of Bombay (AIR 1954 Bombay 365) it was held that the court can remit a portion of the penalty invoking its discretionary power under Section 514(5) of 1898 Code (Section 446(3) of the 1973 Code) even at a subsequent stage. 16. In Sualal Mushilal v. State (AIR 1954 M.P. 231) it was held that the power to remit a portion of the penalty in exercise of its power under clause (5) of Section 514 of the 1898 Code (corresponding to Section 446(3) of 1973 Code) could be exercised so long as the payment of any portion of the penalty remains unenforced. In Sualal Mushilal v. State (AIR 1954 M.P. 231) it was held that the power to remit a portion of the penalty in exercise of its power under clause (5) of Section 514 of the 1898 Code (corresponding to Section 446(3) of 1973 Code) could be exercised so long as the payment of any portion of the penalty remains unenforced. Though the circumstances which justify remission of a portion of the penalty have to be considered by the court before it proceeds to consider the answer of the surety to the show cause notice, still the Court could remit any portion of the penalty if such circumstances occur subsequent to the order of recovery so long as the amount was not totally recovered. 17. In Moola Ram v. State of Rajasthan (1982 Crl.L.J. 2333) the High Court of Rajasthan held as follows: “Even after passing the final order forfeiting the bond, the Court under Section 446(3) can remit any portion of the penalty so long as the amount is not totally recovered. There is nothing in Section 446(3) can remit any portion of the penalty so long as the amount is not totally recovered. There is nothing in Section 446(3) to show that an order remitting any portion of the penalty and enforcing payment of part thereof can be passed by the Court only at the time it passed the final order directing forfeiture of the bond and realization of the amount thereof as penalty.” In the above decision the learned Single Judge had followed Balraj Kapoor’s case and Sualal Mushilal’s case mentioned supra. 18. Sri. Mohammed Anzar, learned counsel for the petitioners submits that judicial precedents mentioned above are unanimous in the view that the court which imposes the penalty after forfeiture of the bond can remit the penalty or direct that only a portion thereof be paid. This can be done even at a subsequent stage. But I find it difficult to agree with the above proposition. 19. In Balraj Kapoor’s case (supra), the learned Judge of the Bombay High Court had observed that: “……. it seems to me that the better view is that the Court is called upon to require the surety to pay the amount of the penalty or to remit a portion of the penalty as soon as the bond is forfeited. 19. In Balraj Kapoor’s case (supra), the learned Judge of the Bombay High Court had observed that: “……. it seems to me that the better view is that the Court is called upon to require the surety to pay the amount of the penalty or to remit a portion of the penalty as soon as the bond is forfeited. It is at that stage that the court is called upon to consider the question as to whether the entire amount of the penalty should be ordered to be paid or only a portion of the amount should be ordered to be paid…. The question whether the discretion is to be exercised at a subsequent stage or at the stage when the Court calls upon the surety to pay the amount of the penalty is, I think, not free from difficulty. It is, I think, possible to take the view that the Court may, in its discretion, remit a portion of the penalty and enforce payment in part only even at a subsequent stage. But I would prefer to say that the Court can insist upon the payment of the entire amount of the penalty or may make an order remitting a portion of the penalty as soon as the bond is forfeited and the Court is called upon to apply its mind to the matter….” 20. I am inclined to agree with the above observation in the judgment, though it was ultimately held by the learned judge that the Court can remit the penalty even at a subsequent stage. 21. There is yet another reason to take the above view. A criminal Court does not have the power to review or re-open its own order. In this case the order that was passed imposing a penalty of Rs.5,000/- each had become final. Therefore, the Court could not have reopened or reviewed its own earlier order as requested by the petitioners. 22. However, the discretion vested in the Court by virtue of clause (3) of Section 446 can be exercised by the appellate or revisional court if the order is challenged as provided under the Code. The appellate or revisional Court, as the case may be, can always consider, even at a later stage, whether there are circumstances warranting remission of penalty. 23. The appellate or revisional Court, as the case may be, can always consider, even at a later stage, whether there are circumstances warranting remission of penalty. 23. It is contended by the leaned Public Prosecutor that in the case on hand, the petitioners had a remedy to challenge the impugned order before the Sessions Court by filing an appeal. It is contended that this petition under Section 482 of the Code cannot be entertained since the petitioners had not resorted to the remedy available to them. It is true that an appeal is provided under Section 449 of the Code, which enables the aggrieved party to file an appeal against “all orders passed under Section 446”. If the impugned order is passed by a Magistrate, an appeal shall lie to the Sessions Court. In the case of an order made by a Court of Sessions, an appeal lies before the High Court. Therefore there is force in the contention of the learned Public Prosecutor that the petitioners are not without any remedy as provided under the Code. 24. But in the peculiar facts and circumstances of this case, I am not inclined to direct the petitioners to approach the appellate court. This Court can always consider the question whether an order passed by the inferior court is just or legal. If there is any illegality or irregularity, this Court can always interfere in order to meet the ends of justice. 25. In the case on hand, the petitioners had stated before the court below that the accused had not actually absconded or had willfully defaulted in appearance. In fact, he was traced out from a mental hospital in Erwadi in Tamil Nadu where he was undergoing treatment. The petitioners had absolutely no information about him at the time when the show cause notice was issued by the court. Immediately after the whereabouts of the accused were known, he was brought back from the mental hospital. The cheque amount was paid to the complainant and the case was settled out of court. It was in the above circumstances that the petitioners had moved an application for remission of the penalty amount. 26. Having regard to the entire facts and circumstances, I am of the view that the penalty imposed on the petitioners can be reduced. Therefore the order passed by the learned Magistrate is modified. It was in the above circumstances that the petitioners had moved an application for remission of the penalty amount. 26. Having regard to the entire facts and circumstances, I am of the view that the penalty imposed on the petitioners can be reduced. Therefore the order passed by the learned Magistrate is modified. The petitioners shall pay a penalty of Rs.500/- each before the court below within four weeks from the date of receipt of a copy of this order. The Crl.M.C is allowed. No costs.