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TMI Blog2018 (2) TMI 2057X X X X Extracts X X X X X X X X Extracts X X X X ..... Award of compensation - permissible under Section 138 of N.I. Act or not - HELD THAT:- Learned Appellate Court while dealing with the contention has noticed that in view of conferment of special power and the jurisdiction of the Judicial Magistrate 1st Class, the ceiling as to the amount of fine stipulated in the Criminal Procedure Code has been removed and, as such, Magistrate can impose sentence or fine under Section 138 N.I. Act beyond ₹ 5000/, which opinion is based on the judgment rendered by the Hon'ble Apex Court titled R. VIJAYAN VERSUS BABY [ 2012 (6) TMI 519 - SUPREME COURT] where it was held that Even where the offence is not compounded, the courts tend to direct payment of compensation equal to the cheque amount (or even something more towards interest) by levying a fine commensurate with the cheque amount. A stage has reached when most of the complainants, in particular the financing institutions (particularly private financiers) view the proceedings under section 138 of the Act, as a proceeding for the recovery of the cheque amount, the punishment of the drawer of the cheque for the offence of dishonour, becoming secondary. The conclusions drawn by le ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... put the complainant into any discomfort, in fact he is making arrangement for payment and had also annexed a cheque worth ₹ 1,00,000/with the objections. (v) Learned trial court convicted the accused (petitioner) under Section 138 of N.I. Act and sentenced him to six months imprisonment and also ordered him to pay a fine of ₹ 3000/, in default to undergo imprisonment for a further period of six months. (vi) Aggrieved of the conviction so recorded by the Magistrate vide his judgment dated 23.10.2013, appeal has been filed unsuccessfully as the same has been dismissed by the Court of learned Additional Sessions Judge, Anantnag, vide judgment dated 30.03.2015. 2. Learned counsel for the petitioner projected that miscarriage of justice in view of two impugned judgments is quite apparent and non-application of mind in passing the judgment impugned is also clear. Buttressing this contention, would submit that the petitioner, in fact, had borrowed an amount of ₹ 12/- lacs from the respondent, which contention is belied by the petitioner himself because in the proceedings recorded by the trial court after the issue of process, issue of two cheques, bouncing ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... may be granted for returning the amount. 4. The amount was not paid, therefore, complainant filed an application under Section 243 Cr.P.C. for passing the judgment. As against that application, petitioner filed objections stating therein that he never intended to put the complainant to any discomfortable position, however, he being under financial distress, is making arrangement for payment to the complainant. In addition has also mentioned therein that a cheque for an amount of ₹ 1,00,000(rupees one lac) bearing No. 36922543 is annexed and more money would be arranged onwards. 5. Learned Magistrate has given ample opportunity to the petitioner for repayment of money which he has failed. The cheque for an amount of ₹ 1,00,000(rupees one lac), which was annexed with the objections, too has been dishonoured by the Bank. 6. Section 243 Cr.P.C. mandates that when an accused admits that he has committed the offence, his admission shall be recorded as nearly as possible in the words used by him and in case he does not show any sufficient cause for not being convicted, the Magistrate shall convict him. Learned Magistrate while following the mandate of Section 243 Cr. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 39;, or with fine which may extend to twice the amount of the cheque, or with both: 9. The provision of Negotiable Instrument Act has an object of controlling and discouraging the cheque bouncing. Conviction or sentence is only resorted to when the accused fails to pay the borrowed amount. Scheme of the Act is such which provides that when a cheque is bounced, notice of demand shall be issued. Then a cooling off period of one month for filing the complaint has been prescribed, so that the amount is paid. Commission of other crimes is different to the crime covered by the Negotiable Instrument Act. In this connection para 17 of the judgment rendered by the Hon'ble Apex Court in the case titled Damodar S. Prabhu v. Sayed Baba Lal H , reported in (2010) 5 SCC 663, is advantageous to be quoted: In a recently published commentary, the following observations have been made with regard to the offence punishable under Section 138 of the Act [Cited from: Arun Mohan, Some thoughts towards law reforms on the topic of Section 138, Negotiable Instruments Act - Tackling an avalanche of cases (New Delhi: Universal Law Publishing Co. Pvt. Ltd., 2009) at p. 5] ... Unlike that for o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under section 357 (1)(b) of the Code and the provision for compounding the offences under section 138 of the Act. Most of the cases (except those where liability is denied) get compounded at one stage or the other by payment of the cheque amount with or without interest. Even where the offence is not compounded, the courts tend to direct payment of compensation equal to the cheque amount (or even something more towards interest) by levying a fine commensurate with the cheque amount. A stage has reached when most of the complainants, in particular the financing institutions (particularly private financiers) view the proceedings under section 138 of the Act, as a proceeding for the recovery of the cheque amount, the punishment of the drawer of the cheque for the offence of dishonour, becoming secondary. 12. Learned Additional Sessions Judge has rightly recorded that the accused has admitted that he owes an amount of ₹ 7,40,000 (rupees seven lacs forty thousand) to the respondent, as such, has enhanced the amount of fine up to ₹ 7,00,000 (rupees seven lacs), on recovery payable as compensation to the respondent. 13. The conclusions drawn by learned Additional Sessio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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