2019 (8) TMI 1358 - HC - Indian Laws

Dishonor of cheque - seeking 20% of the amount of dishonoured cheque as interim compensation - applicability of provisions of Section 143-A of Negotiable Instruments Act - petitioners submits that provisions of Section 143-A of the Act have been brought in force w.e.f. 1/9/2018 during pendency of the complaint therefore, they will not apply to the pending proceedings and will have prospective effect having application to the proceedings initiated after the amendment - HELD THAT - Undisputedly the complaint in the present case under Section 138 has been filed on 21/1/2016. By the Negotiable Instruments (Amendment) Act, 2018 published in the notification dated 2nd August 2018, Section 143-A has been incorporated in The Negotiable Instruments Act, 1881 and vide notification published in the gazette dated 16th August 2018, the amended provision has been brought in force w.e.f. 1st September 2018 - In the present case, the complaint under Section138 of Negotiable Instruments Act was filed on 21/1/2016 prior to coming into force of amended provision section 143-A, of the Act, therefore, the sole issue involved in the present case is as to whether the provisions of Section 143-A will apply to a pending complaint under section 138 of Act. The issue has been concluded in the case of G.J. RAJA VERSUS TEJRAJ SURANA 2019 (8) TMI 91 - SUPREME COURT where it was held that provisions of Section 143A are prospective in nature and can be applied or invoked only in case where the offence under Section 138 of the Act was committed after the introduction of said Section 143A in the Statute Book. The said Section was inserted in the statute Book on 1/9/2018 whereas in the present case the offence was committed much prior to that. Hence the provisions of Section 143A will not be attracted in the present case. Petition allowed.

Summary

Issues:
1. Challenge to trial court's order directing payment of interim compensation under Section 143-A of Negotiable Instruments Act.
2. Challenge to revisional order affirming trial court's decision.
3. Interpretation of the retrospective application of Section 143-A to pending complaints under Section 138 of the Act.

Analysis:
1. The petitioners challenged the trial court's order directing them to pay interim compensation under Section 143-A of the Negotiable Instruments Act, along with the revisional order affirming the same. The respondent filed a complaint under Section 138 of the Act, stating that a cheque of a specific amount was dishonored. The trial court allowed the application for interim compensation, which was upheld by the court of Sessions.

2. The petitioners argued that Section 143-A, introduced after the complaint was filed, should not apply to pending proceedings but have a prospective effect. The respondent contended that the provision rightly applied to pending cases, citing a previous decision by the Coordinate Bench. The court examined the timeline of events and legal principles regarding retrospective application of laws.

3. The High Court referred to a Supreme Court judgment regarding the retrospective application of Section 143-A. The Supreme Court held that Section 143-A should be prospective and applied only to offenses committed after its introduction. The court emphasized that Section 143-A creates a new liability and obligation before the determination of guilt, unlike previous provisions. Therefore, the court concluded that Section 143-A does not apply to cases where the offense occurred before its enactment.

4. Based on the Supreme Court's ruling, the High Court allowed the petition, setting aside the trial court's order and the revisional order. The respondent was not entitled to the benefit of a previous decision due to the retrospective nature of Section 143-A. The judgment clarified the prospective application of Section 143-A to cases where the offense under Section 138 of the Act was committed after the provision's introduction.