2021 (8) TMI 479 - HC - Indian Laws

Dishonor of Cheque - payment of amount of compensation awarded by the trial Court - Principles of natural justice - refusal to entertain cross-examination of respondent-accused - HELD THAT - On perusal of Sections 143A(5) and (6), it clearly reveals that the amount of compensation awarded by the trial Court if not deposited by the accused, then it may be recovered as if it were fine under Section 421 of Cr.P.C., and if it is after completion of the trial, if any fine is 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. Section 143A(5) is exception to the Section 143A(1) of the N.I. Act. Section 143A(1) empowers the order for interim compensation of at least 20% of the cheque amount to be paid within sixty days from the date of order and the same may be recovered as if it a fine under Section 421 of Cr.P.C., as per Section 143A(5) of the N.I. Act. On perusal of the order passed by the trial Court and First Appellate Court for the purpose of non payment of the interim compensation, the right of cross-examination cannot be denied by the trial Court - The First Appellate Court has also considered the aspect holding that the right of cross-examination cannot be denied. It is also pertinent to note under Section 143A(4) empowers that 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. Such being the case, if the accused is not permitted to cross-examine the complainant, the interim order cannot be considered as the final order until completion of trial. Therefore, directing the accused to deposit 20% of the compensation though it is mandatory but it is recoverable by the complainant as if it is fine recovered under Section 421 of Cr.P.C. - Petition dismissed.

Summary

Issues:
1. Rejection of memo filed by the petitioner for refusing to entertain cross-examination of respondent-accused.
2. Interpretation of Section 143A of the Negotiable Instruments Act, 1881 regarding interim compensation.
3. Denial of right of cross-examination based on non-payment of interim compensation.
4. Applicability of Section 421 of the Code of Criminal Procedure in recovering interim compensation.

Analysis:
1. The petition was filed under Section 482 of Cr.P.C. challenging the rejection of a memo by the trial court and the First Appellate Court, which sought to direct the respondent-accused to deposit 20% of the compensation before proceeding with cross-examination. The petitioner contended that non-compliance with the court's order to deposit compensation should result in denial of the right of cross-examination to the accused. The petitioner argued that the trial court and the First Appellate Court erred in allowing cross-examination despite non-compliance with the compensation order.

2. The case involved a private complaint under Section 200 of Cr.P.C. for an offense under Section 138 of the Negotiable Instruments Act, where the respondent-accused failed to deposit the interim compensation as ordered by the trial court under Section 143A(1) of the N.I. Act. The petitioner argued that the compensation order should be enforced before allowing cross-examination, citing the judgment of a Co-ordinate Bench of the Court in support of this position.

3. The respondent-accused objected to the petitioner's argument, asserting that the compensation should be recovered as per Section 421 of Cr.P.C., but denial of cross-examination based on non-payment was unwarranted. The respondent argued that the trial court and the First Appellate Court rightly dismissed the memo seeking to deny cross-examination, maintaining that the right to cross-examination cannot be denied solely based on non-payment of interim compensation.

4. The Court analyzed the provisions of Section 143A of the N.I. Act, emphasizing that the interim compensation could be recovered as a fine under Section 421 of Cr.P.C. The Court noted that the compensation order was separate from the right to cross-examination and that denying cross-examination solely on non-payment grounds was not justified. Referring to previous judgments and statutory provisions, the Court held that the accused's failure to deposit interim compensation did not warrant denial of the right to cross-examination. The Court upheld the decisions of the lower courts in rejecting the petitioner's memo and dismissed the criminal petition accordingly.