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2019 DIGILAW 711 (KER)

Abu Faizal, S/o. Kasimkunju v. State Of Kerala

2019-08-30

MARY JOSEPH

body2019
ORDER : An order passed by the Court of Sessions, Kollam (for short 'the appellate court') in Crl.M.P. No.721/2019 on 13.06.2019 is under challenge in the petition on hand. The accused who has been convicted by Judicial First Class Magistrate Court (Temporary), Kadakkal in ST No.422/2015 for an offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (for short 'the N.I. Act') had preferred Crl.Appeal No.156/2016 before the appellate court and Crl.M.P. No.3117/2016 was filed by him under Section 389(1) Cr.P.C seeking to suspend the execution of sentence. That application was filed in the year 2016 itself and an order was passed by the appellate court on 15.11.2016, the copy of which is appended to the petition on hand as Annexure A1, which reads : “Heard. The sentence imposed by the trial court hereby stands suspended on the following conditions: 1. On depositing Rs.75,000/-(Rupees Seventy Five Thousand only) being a portion of the compensation awarded by the lower court within 30 days from today. 2. On executing a bond for Rs.25,000/-(Rupees twenty five thousand only) with two solvent sureties for the like amount to the satisfaction of the lower court.” 2. The accused has complied with the conditions imposed as above and got the execution of the sentence imposed by the trial court on him, suspended. During the pendency of the appeal, the complainant has filed Crl.M.P. No.721/2019 in Crl.Appeal No.156/2016 under Section 148 N.I. Act seeking for an order directing the appellant/accused to deposit such sum of compensation awarded by the trial court, and to direct the release of the amount so deposited, to him. The application was allowed by the appellate court by order passed on 13.06.2019, the copy of which is appended to this petition as Annexure A2, the relevant part of which is extracted hereunder : “In the result, the appeal is allowed as follows : 1. The appellant/accused is directed to deposit 20% of the said compensation amount awarded as per the impugned judgment before the Court below within 30 days from this day. 2. The appellant/accused is directed to file a memo before this Court on or before 15.07.2019 after making the said deposit. 3. The court below shall release the said amount, if it is deposited, to the complainant/petitioner/respondent as per rules, subject to proviso to Sub.sec.(3) of Sec.148 of the N.I. Act.” 3. 2. The appellant/accused is directed to file a memo before this Court on or before 15.07.2019 after making the said deposit. 3. The court below shall release the said amount, if it is deposited, to the complainant/petitioner/respondent as per rules, subject to proviso to Sub.sec.(3) of Sec.148 of the N.I. Act.” 3. Aggrieved appellant/accused is now before this Court challenging the order and seeking to quash the same. 4. The contention of Sri.S.Sreekumar, the learned Senior Counsel on behalf of the appellant was that Section 148 was brought into N.I. Act, by Amendment Act 20 of 2018 and was effective only from 01.09.2018 and cannot have application in an appeal filed on 15.11.2016, wherein the sentence under challenge was suspended forthwith. According to the learned counsel, the appellant/accused having been complied with the conditions imposed by the appellate court, it is illegal and unjust for the court to impose further obligations on him. According to him, as per direction in the order suspending the sentence, the appellant/accused has deposited Rs.75,000/-towards compensation payable as per judgment of the trial court. 5. According to the learned counsel, the amendment brought into N.I Act being effective only from 01.09.2018, cannot have retrospective operation to Crl.Appeals filed prior to that date and the petitioner who had deposited a part of the compensation to get the sentence imposed against him suspended in the year 2016 ought not to have been burdened with a further liability to deposit 20% of the compensation again. 6. In view of the patent illegality involved in the order, notice to respondent is dispensed with. 7. Section 148 N.I Act is extracted hereunder for easy reference; “148. Power to Appellate Court to order payment pending appeal against conviction.-(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. 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.” 8. Section 148 is a new provision incorporated into N.I Act by Negotiable Instruments (Amendment) Act, 2018, directed by the Parliament to be effective from 01.09.2018. On a reading of the provision it is unambiguous that the Parliament intends it to be invoked in appeals preferred by the accused challenging the judgment passed against them. 9. The appellate court has relied on the dictum in Surinder Singh Deswal @Col.S.S.Deswal and others v. Virender Gandhi [ 2019 (3) KHC 355 (SC)] while passing the impugned order and issuing direction to the accused to make deposit of 20% of compensation. 10. The background for introduction of the new provision into N.I Act is well explained in the objects and reasons of Amendment Act No.20/2018 which reads; “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. 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 realize the value of the cheque. Such delays compromise the sanctity of cheque transactions. 2. 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 cheque 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.” 11. To see that the object and reasons behind enactment of Section 138 N.I Act, not being frustrated the Parliament has thought it fit to incorporate Section 148 into the N.I Act empowering the appellate court to issue direction to the accused to deposit such sum which shall be a minimum of 20% of the fine or compensation awarded by the trial court vide the judgment convicting and sentencing him. 12. Accordingly, the Apex court has discarded the argument of the learned counsel on behalf of the appellant in Surinder's case (supra) that the amendment has taken away or effected the vested right of appeal of the accused and therefore the amendment shall not be made applicable retrospectively and more particularly with reference to cases/complaints filed prior to 01.09.2018 and held that with the amendment incorporating Section 148 into N.I Act, no substantive right of appeal has been taken away and/or effected. 13. The situation on hand needs to be analysed in that backdrop. In the case on hand, the cause of action for preferring the prosecution before the trial court was originated with the dishonour of a cheque on 05.11.2012 for insufficiency of funds. 13. The situation on hand needs to be analysed in that backdrop. In the case on hand, the cause of action for preferring the prosecution before the trial court was originated with the dishonour of a cheque on 05.11.2012 for insufficiency of funds. The judgment which constrained the accused to file appeal was passed as early as on 17.10.2016. Crl.Appeal was filed against the judgment on 15.11.2016. 14. By Annexure A1 order the sentence was ordered to be suspended on compliance of conditions directing execution of bond and deposit of Rs.75,000/-towards compensation awarded by the trial court. According to the petitioner, he has complied both conditions and got his sentence suspended. 15. The Apex Court in Surinder's case (supra) had held that the power under Section 148 N.I. Act to issue direction to the accused to deposit a sum, which shall not be less than 20% of the fine or compensation can be invoked by the appellate court either on an application filed by the accused under Section 389 Cr.P.C seeking to suspend the sentence or on an application filed by the complainant seeking deposit. 16. The power under Section 148 is meant to be invoked by the appellate court while entertaining an appeal from a judgment of conviction imposing sentence on the accused. That is why, it was held as applicable to complaints filed to launch the prosecution under Section 142 N.I. Act and pending before the courts, prior to 01.09.2018. 17. That does not mean that the provision is meant to be invoked in all Crl.Appeals pending before the appellate court which are at the fag end of trial or pronouncement of judgment, why because, with the pronouncement of the judgment there is possibility for the accused being acquitted also. Therefore, no purpose will be served by directing the accused to deposit any sum, at that stage in view of the provision incorporated under Proviso to sub-Section (3) of Section 148 N.I Act directing to refund the amount in deposit within 60 days or 90 days as the case may be, after the judgment turns against the complainant. 18. As the objects and reasons behind the Amendment Act reveal, the deposit was insisted to restrict filing of non-meritorious appeals by unscrupulous complainants and getting orders imposing sentence, suspended leisurely. 18. As the objects and reasons behind the Amendment Act reveal, the deposit was insisted to restrict filing of non-meritorious appeals by unscrupulous complainants and getting orders imposing sentence, suspended leisurely. The Parliament in its wisdom intended to limit the filing of appeals from judgments, where any valid grounds to sustain appeals do not exist. Or in other words, the Parliament's intention while incorporating Section 148 in the N.I. Act was to prevent the prosecution under Section 142 N.I. Act from being dragged unnecessarily. Parliament thought it fit to put a restriction on the filing of frivolous appeals and therefore made provision for deposit of a portion, not less than 20% of the fine or compensation imposed by the trial court. This aspect is made clear in the provisions incorporated for refund of the amount, on the judgment turns in favour of the accused and ends in acquittal. 19. Therefore, the power is meant to be invoked at a point of time when appeal is preferred or to say more specifically, prior to passing of an order suspending the execution of sentence in an application preferred under Section 389(1) Cr.P.C in the Appeal. The application preferred by either party to the appeal beyond that time shall not be entertained by the appellate court in view of sub-sections (2) and (3) and proviso thereunder, which stipulate time for making deposits, provision for release of the amount deposited to the complainant and for refund of the amount to the appellant/accused on himself being acquitted. 20. In the case on hand as revealed from the dates and events of Crl.A. No.156/2016, the appeal was preferred on 15.11.2016, finally heard on 05.07.2018 and posted for judgment on 25.07.2018. On 10.08.2018, the case was reopened for further hearing and Crl.M.P. No.721/2019 was filed by the complainant. On 13.06.2019, Crl.M.P was allowed directing the accused to deposit 20% of the compensation awarded by the trial court within 30 days from 13.06.2019, the date of Annexure A2 order. The accused was directed to file a memo before the court which passed the order on or before 15.07.2019 after making the deposit. The trial court was directed to release the amount, if deposited to the complainant subject to proviso to sub-section (3) of Section 148 N.I. Act. 21. The accused was directed to file a memo before the court which passed the order on or before 15.07.2019 after making the deposit. The trial court was directed to release the amount, if deposited to the complainant subject to proviso to sub-section (3) of Section 148 N.I. Act. 21. Crl.M.P. No.721/19 seeking for an order directing the accused to deposit a portion of the compensation awarded by the judgment of the trial court and release of the same was filed by the complainant at a time when hearing of the appeal was over and posted for judgment. The application was filed after getting the case reopened for further hearing. Annexure A2 order allowing the application was passed by the appellate court on 13.06.2019. The said order, which is under challenge, is undoubtedly against the intention of the Parliament while incorporating Section 148 into N.I. Act, which could be deduced from the object and reasons extracted supra. It is pertinent to note that the appeal was heard once and posted for judgment on 25.07.2018. Sub-section (3) of Section 148 makes provision for release of the amount deposited by the accused to the complainant on application being filed for the purpose. Therefore, under sub-section (2) the period within which the deposit can be made is specified. At any cost, the period shall not exceed 90 days from the date of passing of the order. In that context, sub-section (3) and proviso thereto assume much importance. As per sub-section (3), the appellate court may direct the release of the amount deposited by the accused to the complainant during the course of pendency of the appeal. Proviso to sub-section (3) says that on the appeal culminated in acquittal of the accused after reversal of the judgment convicting him, the court shall direct the complainant to repay the amount received by him to the accused with interest at the bank rate as published by Reserve Bank of India and prevalent at the beginning of the relevant financial year, within 60 days from the date of the order or within such further period not exceeding 30 days as may be directed by the Court on being convinced of the reason stated by the complainant for not making the deposit within 60 days. Therefore, the appellate court is empowered to direct repayment of compensation amount received by the complainant to the accused on the judgment appealed against being reversed and the latter, acquitted. The time limit within which the refund shall be made by the complainant is also precisely stated therein as 60 days in case the complainant has no cogent reasons for failure to make deposit within that time and 30 days more in case complainant has convincing reasons for failure to deposit the sum within 60 days from the date of the order. However, on reversal of the judgment under challenge and acquittal of the accused, the complainant has to repay the amount to the accused. In the case on hand, since the judgment in the appeal was at the verge of pronouncement, the very purpose contemplated under sub-sections (2) and (3) and proviso thereto could not be served with the deposit directed to be made by the appellant vide order passed on 13.06.2019. The pronouncement of the judgment either convicting or acquitting the accused being imminent, provisions (2) and (3) and proviso thereunder would become meaningless on directing deposit being made at that stage. 22. Moreover, the impugned order was passed by the appellate court unmindful of Annexure A1 order passed by it in Crl.M.P. No.3177 of 2016 on 15.11.2016. At the time of passing Annexure A1 order to suspend the execution of the sentence, the court has directed the accused to deposit Rs.75,000/-, a portion of the compensation awarded by the lower court by the impugned judgment. The said direction was also complied with by depositing Rs.75,000/-before the trial court. Accordingly, the execution of the sentence under challenge in Crl.A.156/2016 was suspended. The order suspending the execution of the sentence was passed immediately after preferring Criminal Appeal challenging the judgment of the trial court. Rs.75,000/-of the compensation amount is now under deposit from the side of the appellant. The appeal in question is found originated from a complaint filed in the year 2015. The appeal is filed two years prior to incorporation of Section 148 into the N.I. Act. Rs.75,000/-of the compensation amount is now under deposit from the side of the appellant. The appeal in question is found originated from a complaint filed in the year 2015. The appeal is filed two years prior to incorporation of Section 148 into the N.I. Act. Since the appeal was admitted and an order suspending the execution of the sentence was passed after 2 years of incorporation of Section 148 into the N.I. Act and Rs.75,000/-as directed by the Court was deposited as a condition precedent for suspending execution of sentence in the appeal, the trial court is highly unjustified in re-opening the prosecution which was almost concluded and posted for judgment for the purpose of consideration of Crl.M.P No.721/2019 and to pass the impugned order. Annexure A2 order, undoubtedly is an erroneous one as it was passed in total disregard of the object and reasons of the Parliament while incorporating Section 148 into the Act. The Apex Court has held that Section 148 has application in complaints filed to launch prosecution under Section 142 N.I Act prior to 01.09.2018, which are pending consideration of courts. The Appellate court in the case on hand misread the direction as if it has application to all appeals pending on the files of the appellate court. To appeals already admitted and pending consideration prior to 01.09.2018, the provision does not have application or in other words Section 148 can have retrospective operation only to pending prosecutions under Section 142 N.I Act (complaints). As far as appeals are concerned, Section 148 can have only prospective application i.e. invocation of Section 148 N.I Act is confined only to appeals filed after 01.09.2018. For the foregoing reasons, the order under challenge is liable to be set aside. In the result, Crl.M.C stands allowed. The order under challenge is set aside.