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Telangana High Court · body

2022 DIGILAW 743 (TS)

Lingamaneni Venkata Surya Rajasekhar v. State of Telangana, reptd by its Public Prosecutor

2022-11-19

CHILLAKUR SUMALATHA

body2022
ORDER : These Criminal Petitions seven in number, vide Criminal Petition Nos.9830, 9832, 9836, 9843, 9860, 9861 and 9744 of 2022, though arose out of different Criminal Revision Petitions, are based on similar set of facts. Also, common question of law is involved. Hence, all are taken up together for discussion and disposal. 2. Challenge in Criminal Petition No.9830 of 2022 is the order that is rendered by the Court of Metropolitan Sessions Judge, Hyderabad in Criminal Revision Petition No.82 of 2022 dated 14.10.2022. The said order is the outcome of the decision rendered by the Court of VI Metropolitan Magistrate, Hyderabad in Crl.M.P.No.90 of 2022 in STC.NI.No.288 of 2021, dated 13.6.2022. 3. Challenge in Criminal Petition No.9832 of 2022 is the order that is rendered by the Court of Metropolitan Sessions Judge, Hyderabad in Criminal Revision Petition No.83 of 2022 dated 14.10.2022. The said order is the outcome of the decision rendered by the Court of VI Metropolitan Magistrate, Hyderabad in Crl.M.P.No.88 of 2022 in STC.NI.No.300 of 2021, dated 13.6.2022. 4. Challenge in Criminal Petition No.9836 of 2022 is the order that is rendered by the Court of Metropolitan Sessions Judge, Hyderabad in Criminal Revision Petition No.88 of 2022 dated 14.10.2022. The said order is the outcome of the decision rendered by the Court of VI Metropolitan Magistrate, Hyderabad in Crl.M.P.No.323 of 2022 in STC.NI.No.296 of 2021, dated 13.6.2022. 5. Challenge in Criminal Petition No.9843 of 2022 is the order that is rendered by the Court of Metropolitan Sessions Judge, Hyderabad in Criminal Revision Petition No.89 of 2022 dated 14.10.2022. The said order is the outcome of the decision rendered by the Court of VI Metropolitan Magistrate, Hyderabad in Crl.M.P.No.328 of 2022 in STC.NI.No.294 of 2021, dated 13.6.2022. 6. Challenge in Criminal Petition No.9860 of 2022 is the order that is rendered by the Court of Metropolitan Sessions Judge, Hyderabad in Criminal Revision Petition No.84 of 2022 dated 14.10.2022. The said order is the outcome of the decision rendered by the Court of VI Metropolitan Magistrate, Hyderabad in Crl.M.P.No.92 of 2022 in STC.NI.No.292 of 2021, dated 13.6.2022. 7. Challenge in Criminal Petition No.9861 of 2022 is the order that is rendered by the Court of Metropolitan Sessions Judge, Hyderabad in Criminal Revision Petition No.87 of 2022 dated 14.10.2022. The said order is the outcome of the decision rendered by the Court of VI Metropolitan Magistrate, Hyderabad in Crl.M.P.No.92 of 2022 in STC.NI.No.292 of 2021, dated 13.6.2022. 7. Challenge in Criminal Petition No.9861 of 2022 is the order that is rendered by the Court of Metropolitan Sessions Judge, Hyderabad in Criminal Revision Petition No.87 of 2022 dated 14.10.2022. The said order is the outcome of the decision rendered by the Court of VI Metropolitan Magistrate, Hyderabad in Crl.M.P.No.77 of 2022 in STC.NI.No.314 of 2021, dated 13.6.2022. 8. Challenge in Criminal Petition No.9744 of 2022 is the order that is rendered by the Court of Metropolitan Sessions Judge, Hyderabad in Criminal Revision Petition No.81 of 2022 dated 14.10.2022. The said order is the outcome of the decision rendered by the Court of VI Metropolitan Magistrate, Hyderabad in Crl.M.P.No.89 of 2022 in STC.NI.No.289 of 2021, dated 13.6.2022. 9. The respective complainants in all the complaints, which are filed under Section 138 of the Negotiable Instruments Act, 1881, moved separate applications invoking Section 143-A of the Negotiable Instruments Act, 1881, seeking the Court to direct the accused therein to deposit 20% of the cheque amount as interim compensation pending adjudication of the main cases. The trial Court disallowed their request and aggrieved by the same, the respective complainants moved Criminal Revision Petitions before the Court of Metropolitan Sessions Judge, Hyderabad. The revisional Court allowed those Crl.R.Ps by setting aside the orders of the trial Court and consequently, directed the accused to deposit 20% of the cheque amount as interim compensation. Aggrieved by the said orders, the accused are before this Court. 10. Making his submission, learned counsel for the petitioners contended that the petitioners-accused have not admitted their liability before the trial Court. Learned counsel stated that there is no legally enforceable debt and thus, the accused are not liable to pay any amount. Learned counsel also states that the debts are barred by limitation and further, though the complainants relied upon the memorandum of understanding, no liability can be fastened upon the accused even through the said memorandum of understanding and hence, the claims for realisation of the cheque amounts are unjustifiable. Learned counsel also states that the debts are barred by limitation and further, though the complainants relied upon the memorandum of understanding, no liability can be fastened upon the accused even through the said memorandum of understanding and hence, the claims for realisation of the cheque amounts are unjustifiable. Learned counsel also stated that when the alleged debts are barred by the law of limitation, the cheques issued for the purpose of discharge of the alleged debts cannot be enforced and thus, the accused cannot be held to have committed the offence punishable under Section 138 of the Negotiable Instruments Act, 1881. Furthermore, all the disputes arising out of the memorandum of understanding have to be resolved through arbitration and therefore, the complaints filed ought not to have been entrained by the trial Courts, but somehow they were entertained. Learned counsel states that the trial Court rightly dismissed the applications filed for grant of interim compensation, but the revisional Court without looking into the merits of the case, ordered the accused to pay interim compensation and therefore, the impugned orders of the revisional Court have to be set aside. 11. Learned counsel for the petitioners stated that grant of interim compensation under Section 143-A of the Negotiable Instruments Act, 1881, is only directory, but not mandatory and the trial Court exercised its discretion and disallowed the request of the complainants for grant of interim compensation. Learned counsel further submitted that discretion is given to the Court to award compensation ranging from 1% to 20% of the cheque amount and nowhere in Section 143-A of the Negotiable Instruments Act, 1881, it is stated that interim compensation of 20% has to be awarded. But, even that fact is ignored by the revisional Court. By submitting thus, learned counsel for the petitioners-accused sought for setting aside the impugned orders rendered by the revisional Court. 12. Vehemently opposing the submissions thus made, learned counsel for the respondents-complainants in the respective cases stated that execution of Memorandum of understanding is not denied by any of the petitioners-accused and further, the debts are not time barred. Learned counsel also states that when the debts are acknowledged, the limitation period gets extended. 12. Vehemently opposing the submissions thus made, learned counsel for the respondents-complainants in the respective cases stated that execution of Memorandum of understanding is not denied by any of the petitioners-accused and further, the debts are not time barred. Learned counsel also states that when the debts are acknowledged, the limitation period gets extended. Learned counsel further stated that the cheques in question were issued to discharge the legally enforceable debts and when the said cheques were presented for encashment, they were dishonoured and therefore, the complainants filed different complaints for realisation of the amounts due. Learned counsel also states that through amendment to the Negotiable Instruments Act, 1881, Section 143-A was introduced and the said provision was introduced to give some relief to the complainants who lost their money and were deceived by issuing cheques which could not be honoured. In the present cases also, the respective accused gave different cheques which were dishonoured and therefore, the complainants filed different complaints for realisation of the amount. 13. Learned counsel for the respondents-complainants further submits that in normal course, the complaints filed under Section 138 of the Negotiable Instruments Act, 1881, are pending for more than ten years and though the complainants are attending the Courts on each and every adjournment, the accused are filing interlocutory applications and inviting different orders from the Courts and thereafter also, they are preferring Appeals and Revisions and getting orders of stay and thus, the complaints are pending on the file of different Courts. Learned counsel also states that the complainants are also spending huge amount for litigation and at the end, though the accused are convicted, they are unable to realise at least the cheque amount and having seen the plight of the complainants, by amending the Negotiable Instruments Act, 1881, the concept of interim compensation is introduced and therefore, invoking the said provision i.e., Section 143-A of the Negotiable Instruments Act, 1881, the complainants moved the trial Court seeking interim compensation. But, adopting the same old procedure, the trial Court dismissed the applications filed by the complainants. However, the revisional Court has allowed their request and thus, the orders of the revisional Court have to be confirmed. 14. Thus, in the light of the submissions made by the respective parties, the points that arise for consideration are: (1) Whether the complainants in respective cases are entitled for interim compensation as prayed for. However, the revisional Court has allowed their request and thus, the orders of the revisional Court have to be confirmed. 14. Thus, in the light of the submissions made by the respective parties, the points that arise for consideration are: (1) Whether the complainants in respective cases are entitled for interim compensation as prayed for. (2) Whether there exists any infirmity in the orders of the revisional Court which are under challenge either in appreciating the facts of the case or in applying the established principles of law to the said facts, as contended by the petitioners in the respective Criminal Petitions, which in turn requires interference by this Court. (3) Whether the impugned orders that are rendered by the Court of Metropolitan Sessions Judge, Hyderabad, are liable to be quashed as prayed for. POINT Nos.1 to 3:- 15. The case of the complainants in the respective complaints is that the accused mentioned therein issued cheques for different amounts towards partial discharge of the legally enforceable debts and when the said cheques were presented, they were dishonoured and thus, they have committed the offence punishable under Section 138 of the Negotiable Instruments Act, 1881. It is their further case that though statutory legal notices were issued to the accused demanding them to pay the cheque amounts, replies were given with false contentions and thus, the accused are liable for punishment as provided under Section 138 of the Negotiable Instruments Act, 1881. 16. The version of the petitioners-accused is that the cheques in question were not issued towards discharge of any legally enforceable debts and further, the Memorandum of Understanding referred to in the complaints does not bind them. 17. Thus, when the contention of the respondents-complainants is that the petitioners-accused have issued the cheques in question towards partial discharge of legally enforceable debts, on the other hand, the contention of the accused is that the said cheques were outcome of the contractual transactions that went on between both the parties, but were not issued for discharge of any liability or debt. 18. The issue, however, to be discussed and the limited point involved is whether pending disposal of the complaints, the complainants are entitled for interim compensation as prayed for. 19. Sections 143 to 147 of the Negotiable Instruments Act, 1881 were inserted in the Negotiable Instruments Act, 1881 by Act 55 of 2002. 18. The issue, however, to be discussed and the limited point involved is whether pending disposal of the complaints, the complainants are entitled for interim compensation as prayed for. 19. Sections 143 to 147 of the Negotiable Instruments Act, 1881 were inserted in the Negotiable Instruments Act, 1881 by Act 55 of 2002. The amendments are aimed at speedy disposal of cases relating to offences of dishonor of cheques. The legislative reforms were made so as to encourage usage of cheques and to enhance the credibility of the instrument so that normal business transactions and settlement of liabilities could be ensured. Power was given to the Court to try the cases filed under Section 138 of the Negotiable Instruments Act, 1881, summarily. Also, power was given to the Court to order the drawer of the cheques to pay interim compensation to the complainants. Section 143-A grants such power, which reads as under:- “Power to direct interim compensation.- (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 subsection (1) shall not exceed twenty percent 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. (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.” 20. Thus, by the above provision, the Court which is empowered to try an offence punishable under Section 138 of the Negotiable Instruments Act, 1881, is given the power to order the drawer of the cheque to pay interim compensation to the complainant in two circumstances, firstly, in a summary trial or summons case where, the accused pleads not guilty and secondly, in respect of other cases upon framing of charges. It is clearly indicated that the interim compensation granted shall not exceed 20% of the cheque amount and that the amount awarded towards interim compensation shall be paid within 60 days from the date of the order. Also, power is granted to the Court to extend the said time for a further period not exceeding 30 days in case sufficient cause is shown by the drawer of the cheque. 21. Baring the cases in which the accused admits the liability and comes forward to get the offence compounded, in all other cases, the accused would deny the liability and contest the matter. The trial proceedings in the complaints filed under the Negotiable Instruments Act, 1881, would go on for years together and even after the judgment is rendered convicting the accused and levying compensation/fine, the accused would normally prefer appeal and even after the appeal is disposed of confirming the judgment of conviction, the accused would prefer Revision. When the statistics are looked into, one can find that cases of more than ten years old are pending either at trial stage or at appellate stage or at revisional stage. Analyzing these facts, the legislature, by its wisdom, to speed up the process of adjudication, and in the meantime, to aid the complainants, has introduced certain reforms which are in the form of Sections 143 to 148 of the Negotiable Instruments Act, 1881. Section 148 of the Negotiable Instruments Act, 1881, was inserted by Act 20 of 2018. Analyzing these facts, the legislature, by its wisdom, to speed up the process of adjudication, and in the meantime, to aid the complainants, has introduced certain reforms which are in the form of Sections 143 to 148 of the Negotiable Instruments Act, 1881. Section 148 of the Negotiable Instruments Act, 1881, was inserted by Act 20 of 2018. By the said provision, post conviction, power is granted to the appellate Court to direct the appellant to deposit a minimum of 20% of the fine or compensation awarded by the trial Court. Therefore, as the accused has taken a plea that he is not liable to answer the cheque in question or that, there is no legally enforceable debt, it cannot be held that the Court should not award interim compensation. However, the legislature has left to the discretion of the Court to award interim compensation. 22. Admittedly, the word “may” is used and not “shall” in Section 143-A of the Negotiable Instruments Act, 1881. Hence, it is clear that wide discretion is granted to the Court either to award interim compensation or to deny. However, when sensing the difficulty of the complainants in getting redressal, a particular provision is introduced, it would be wholly desirable to give value to the aims and objectives of the said provision. 23. When the orders of the trial Court are gone through, this Court finds that the said Court has gone too deep into the merits of the cases and discussed about the genuineness in the pleadings raised. When no evidence on either side is on record, it would not be safe to discuss about the merits of the case, that too purely based on the pleadings, and give findings. Sensing the same, the revisional Court had set aside the orders that were rendered by the trial Court, and attaching value to the legislative intent, directed the accused to deposit interim compensation which is to an extent of 20% of the cheque amounts. 24. Sensing the same, the revisional Court had set aside the orders that were rendered by the trial Court, and attaching value to the legislative intent, directed the accused to deposit interim compensation which is to an extent of 20% of the cheque amounts. 24. Though an argument is raised by the learned counsel for the petitioners-accused that when it is indicated in Section 143-A of the Negotiable Instruments Act, 1881, that interim compensation would be awarded upto 20%, it can be from 1% to 20% and therefore, the revisional Court should have awarded interim compensation less than 20% of the cheque amount, this Court does not find any justifiable grounds even to reduce the said percentage. Before this Court, no such grounds are projected so as to interfere with the impugned orders of the revisional Court for reducing the said percentage from 20. 25. Likewise, though it is contended that the Criminal Revision Petitions itself are not maintainable as the orders rendered by the trial Court under Section 143-A of the Negotiable Instruments Act, 1881, are interlocutory orders, this Court is not inclined to appreciate the said submission as such a ground was not put forth before the revisional Court. 26. Learned counsel for the respondents-complainants bringing to the notice of this Court the orders of the revisional Court, has contended that no such ground is urged before the revisional Court and hence, such a ground cannot be permitted to be taken before this Court. Learned counsel for the petitioners-accused has not answered that point. Learned counsel did not state whether such a ground was urged before the revisional Court. 27. Coming to the decisions relied upon, learned counsel for the petitioners relied upon the decision of the Hon'ble Apex Court in the case between Noor Mohammed Vs. Khurram Pasha, (2022) 9 SCC 23 . When the said decision is gone through, this Court finds that though the applicability of Section 143-A of the Negotiable Instruments Act, 1881, was discussed, the facts and circumstances of the said case differ to that of the present cases. In the said case, the Hon'ble Apex Court dealt with the legality in denial of right to cross-examine the witnesses on the ground of failure on part of the accused to deposit interim compensation. 28. In the said case, the Hon'ble Apex Court dealt with the legality in denial of right to cross-examine the witnesses on the ground of failure on part of the accused to deposit interim compensation. 28. The second decision that is relied upon by learned counsel for the petitioners is the decision of the High Court of Karnataka in the case between V.Krishnamurthy Vs. Dairy Classic Ice Creams Private Limited, (2022) 236 AIC 762, wherein the Court, dealing with the provision under discussion, at para 16 of the judgment held as under: “16. Application of mind and passing of a reasoned order of grant of compensation becomes necessary in the light of penal consequences that ensue an accused who failed to comply with the order granting 20% compensation as the complainant is given several remedies of recovery which result in the accused being taken into custody. Therefore, such orders which result in such penal consequences should be rendered giving cogent reasons which would demonstrate application of mind and such orders should be passed only after hearing the accused in the matter. In cases where the learned Magistrate is to exercise discretion, such discretion should become two fold. First fold : Where an application is so made, the learned Magistrate has to apply his mind whether such an application is to be considered at all, as every application that is made need not result in grant of 20% interim compensation Several factors need be gone into for considering such applications bearing in mind the reason and backdrop of the amendment. As quoted herein-above the bedrock of the amendment was to stall unscrupulous drawers of cheques drawing proceedings with frivolous applications, absenting themselves, seeking continuous adjournments causing delay and grave prejudice to the case of the complainants. In these factors, the learned Magistrate after analyzing the conduct of the accused should grant compensation which would vary from 1% to 20% after recording reasons. In a given case if the accused is cooperating with the trial without seeking any unnecessary adjournments, not absenting himself or his counsel on any date and cooperating with the conclusion of the trial in such cases, the learned Magistrate will have to apply his mind, exercise his discretion as to whether such applications should he entertained at all. Therefore, it forms two classes of litigants. One who would cooperate with the proceedings and the other who would not. Therefore, it forms two classes of litigants. One who would cooperate with the proceedings and the other who would not. In cases where there is complete co-operation from the hands of the accused in the trial, the Court may consider whether interim compensation has to be granted at all and in cases where there is no cooperation on the part of the accused, the Court may proceed to consider the application. Second fold : The second fold of discretion in any given case, the compensation may vary from 1% to 20%. It is nowhere depicted in the statute that the amount of interim compensation should be of a particular figure. It can vary from 1% to 20%. It is this variance that gives the learned Magistrate power to exercise discretion to grant such compensation. The mandate of the statute is that it should not exceed 20%. In the cases where learned Magistrate proceeds to grant compensation, has to bear in mind the amount involved in the Instrument, as certain transactions would run to several cores and the accused may have formidable defence against the complainant. In such cases, the learned Magistrate should exercise discretion in a cautious manner. Here again the conduct of the accused should be noticed. Therefore, the aforesaid two fold discretion is sine qua non for an order to be passed by the learned Magistrate while considering the application under Section 143A of the Act.” 29. The third decision which is relied upon by learned counsel for the petitioners is also one of the High Court of Karnataka in the case between Jahangir Vs. Farooq Ahmed Abdul Razak in Criminal Petition No.201213 of 2020, wherein the Court opined that Section 143-A(1) of the Negotiable Instruments Act, 1881, is not mandatory. In the said decision, the observation of the Court is as under:- “Section 143-A(1) is not a mandatory provision and it says that Court may order the drawer of the cheque to pay the interim compensation as per conditions stipulated thereunder. So it is evident that the power under Section 143-A is vested with the magistrate to be exercised judiciously after recording the plea and it is not mandatory, but the learned Magistrate is required to exercise his judicious discretion under Section 143-A of the Act.” 30. So it is evident that the power under Section 143-A is vested with the magistrate to be exercised judiciously after recording the plea and it is not mandatory, but the learned Magistrate is required to exercise his judicious discretion under Section 143-A of the Act.” 30. On the other hand, contending that the word “may” used in Section 143-A of the Negotiable Instruments Act, 1881, has to be read as “shall”, the learned counsel for the respondents-complainants relied upon the decision of the High Court of Chhattisgarh in the case between Rajesh Soni Vs. Mukesh Verma, 2021 SCC Online Chh 1761. 31. Undoubtedly, wide discretion is vested upon the Court to award interim compensation which may extend upto 20% of the cheque amount in deserving cases. The parameters that are required to be adopted are not indicated in the said provision. Therefore, the Courts are under obligation to apply their judicious mind and to take a decision whether or not to award interim compensation. This Court does not find any such circumstances to hold that the word “may” used in Section 143-A of the Negotiable Instruments Act, 1881, be read as “shall”. At the same time, having regard to the aims and objectives for which the said provision is introduced, this Court is of the view that in all deserving cases, it would be wholly desirable to award interim compensation to the extent indicated in the said provision, however, subject to the judicious discretion to be exercised. 32. Admittedly, Section 143-A(4) of the Negotiable Instruments Act, 1881, clearly says that if the drawer of the cheque is acquitted, the Court is under obligation to direct the complainant to repay to the drawer of the cheque the amount of interim compensation with interest at the bank rate within 60 days from the date of such order or within such further period not exceeding 30 days in case sufficient cause is shown by the complainant. Therefore, the trial Court ought to have awarded interim compensation as prayed for. However, it did not do so. As earlier stated, the trial Court went deep into the merits of the case without there being any evidence on record and gave a finding that the complainants in the respective cases are not entitled to interim compensation. However, the revisional Court having discussed the law laid down, has come to a just conclusion. However, it did not do so. As earlier stated, the trial Court went deep into the merits of the case without there being any evidence on record and gave a finding that the complainants in the respective cases are not entitled to interim compensation. However, the revisional Court having discussed the law laid down, has come to a just conclusion. This Court, therefore, does not find any grounds, more so justifiable grounds to exercise the power granted under Section 482 Cr.P.C. and to quash the impugned orders that are rendered by the revisional Court. 33. Resultantly, all the Criminal Petitions are dismissed. 34. As a sequel, pending miscellaneous applications, if any, shall stand closed.