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TMI Blog2023 (5) TMI 645X X X X Extracts X X X X X X X X Extracts X X X X ..... ds". According to the respondent no. 1, the liability of repayment of loan amount was Rs. 19 lakhs which the respondent no. 1 advanced to the petitioner. The summons was served on the petitioner on 04/01/2022. The petitioner pleaded not guilty on 05/04/2022. The applications were made by the petitioner on 21/06/2022 for permitting him to cross examine the respondent no. 1 under section 145(2) of the NI Act at Exhibit D-33. The petitioner set up a defence that there is no legally enforceable debt as claimed by the respondent no. 1. Further, the petitioner denied having any loan transaction with the complainant. The petitioner stated that he did not receive any notice as contemplated under NI Act. 4. The respondent no. 1 filed reply at Exhibit D-35. The applications under section 145(2) of the NI Act were opposed by the respondent no. 1 on the ground that the petitioner has not set out any specific point of defence and the application is mere denial of the complaint. It is stated that the petitioner did not avail of his opportunity for defence at the time when legal notice was served upon the petitioner and secondly, when the Court summons of the complaint was served upon the petiti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e accused to disclose and defence, it is humbly stated that in the present case, the Petitioner had moved an application for cross examination, which clearly spells out two defences, one that there existed no loan transaction between the Petitioner and the Respondent and secondly that the Statutory Notice allegedly sent on the email of the Petitioner was never received by him. [Reference : Annexure C, Pg. 65] 8. It bears mentioning that the Respondent has not produced a single document in support of their claim of a loan transaction between himself and the Petitioner. 9. Therefore, even in terms of Meters and Instruments Private Limited and Ors vs Kanchan Mehta, the Petitioner has complied with the requirements, by disclosing his defence in his application under section 145(2) and the Ld. Magistrate thus acted beyond his jurisdiction by entering into the merits of the defence set out and rejecting the application." 6. Learned counsel for respondent no. 1 has apart from oral submissions, tendered written submissions as under : "2. The issue is squarely covered by the Judgment of the Hon'ble Supreme Court in the case of Indian Bank Association & Ors Vs. UOI. In Indian Bank ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erence to the judgments of the Hon'ble Supreme Court in the case of Indian Bank Association & Ors. Vs. Union of India & Ors., 2014 (5) SCC 590, and Meters and Instruments Private Limited & Anr. Vs. Kanchan Mehta, 2018 (1) SCC (Cri) 477. 10. In Indian Bank Association (supra) directions were issued that, "after appearance of the accused, the Magistrate should ask him to take notice under Section 251 of Cr.P.C. in order to enable the accused to enter his plea of defence and thereafter fix the case for defence evidence, unless an application is made by the accused under Section 145(2) for reading a witness for cross-examination. 11. In the case of Meters and Instruments Private Limited (supra), the Hon'ble Supreme Court has held that," if the accused wants to contest the case, he must be required to disclose specific defence for such contest and for this purpose, it is open to the Court to ask specific questions to the accused at that stage." 12. Therefore, considering the above settled position of law, the application filed by the accused is silent on the specific ground of defence or point on which the accused wishes to cross-examine the complainant. Therefore, the permissio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act is also available to the accused? [Appeal arising from SLP (Crl.) No.3915 of 2006.]" 10. Their Lordships examined the relevant legal provisions and ascertained the object and reasons for which those provisions were brought into existence by making amendment in the NI Act. Relevant in the context of the present case are paragraphs 20 to 25 which are as under : "20. It may be noted that the provisions of Sections 143, 144, 145 and 147 expressly depart from and override the provisions of the Code of Criminal Procedure, the main body of adjective law for criminal trials. The provisions of Section 146 similarly depart from the principles of the Evidence Act. Section 143 makes it possible for the complaints under Section 138 of the Act to be tried in the summary manner, except, of course, for the relatively small number of cases where the Magistrate feels that the nature of the case is such that a sentence of imprisonment for a term exceeding one year may have to be passed or that it is, for any other reason, undesirable to try the case summarily. 21. It is, however, significant that the procedure of summary trials is adopted under Section 143 subject to the qualification "as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tages and processes in a regular criminal trial that normally cause inordinate delay in its conclusion and to make the trial procedure as expeditious as possible without in any way compromising on the right of the accused for a fair trial. Here we must take notice of the fact that cases under Section 138 of the Act have been coming in such great multitude that even the introduction of such radical measures to make the trial procedure simplified and speedy has been of little help and cases of dishonoured cheques continue to pile up giving rise to an unbearable burden on the criminal court system." 11. The Supreme Court held that the evidence on affidavit given by the complainant or his witness under section 145(1) is in the nature of his examination-in-chief and on being summoned by the Court on application made by the accused under section 145(2), is not required to depose again in examination-in-chief before being cross examined as to the facts stated in the affidavit. In paragraphs 30 and 34, the Supreme Court held thus : "30. Nevertheless, the submissions made on behalf of the parties must be taken note of and properly dealt with. Mr. Ranjit Kumar, learned Senior Advocate, a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... construction should not be departed from, particularly when the words of the statute are clear and unambiguous. He relied upon the decision in Raghunath Rai Bareja v. Punjab National Bank. 33. We are completely unable to appreciate the submission. The plea for a literal interpretation of Section 145(2) is based on the unfounded assumption that the language of the section clearly says that the person giving his evidence on affidavit, on being summoned at the instance of the accused must start his deposition in court with examination-in-chief. We find nothing in Section 145(2) to suggest that. We may also make it clear that Section 137 of the Evidence Act does not define "examine" to mean and include the three kinds of examination of a witness; it simply defines "examination-in-chief", "cross-examination" and "re-examination". What Section 145(2) of the Act says is simply this. The court may, at its discretion, call a person giving his evidence on affidavit and examine him as to the facts contained therein. But if an application is made either by the prosecution or by the accused the court must call the person giving his evidence on affidavit, again to be examined as to the facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of his evidence, he may be re- examined. Thus, the words "examine any person giving evidence on affidavit as to the facts contained therein, in the event, the deponent is summoned by the court in terms of sub-section (2) of Section 145 of the Act", in our opinion, would mean for the purpose of cross- examination. The provision seeks to attend a salutary purpose." 16. Considerable time is usually spent for recording the statement of the complainant. The question is whether the Court can dispense with the appearance of the complainant, instead, to take steps to accept the affidavit of the complainant and treat the same as examination-in-chief. Section 145(1) gives complete freedom to the complainant either to give his evidence by way of affidavit or by way of oral evidence. The Court has to accept the same even if it is given by way of an affidavit. Second part of Section 145(1) provides that the complainant's statement on affidavit may, subject to all just exceptions, be read in evidence in any inquiry, trial or other proceedings. Section 145 is a rule of procedure which lays down the manner in which the evidence of the complainant may be recorded and once the Court issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he complainant must be conducted within three months of assigning the case. The court has option of accepting affidavits of the witnesses, instead of examining them in the court. The witnesses to the complaint and accused must be available for cross-examination as and when there is direction to this effect by the court." 14. In Meters and Instruments Private Limited and anr. Vs. Kanchan Mehta (2018) 1 Supreme Court Cases 560, the Supreme Court was considering the issue as regards the rejection of the prayer by the High Court for compounding offence under section 138 of NI Act on payment of cheque amount and in the alternative for exemption from personal appearance. When the matter came up for hearing before the Supreme Court, notice was issued to consider the question as to how the proceedings for an offence under section 138 of the Act can be regulated, where the accused is willing to deposit the cheque amount. The question for consideration was "Whether in such a case, the proceedings can be closed or exemption granted from personal appearance or any other order can be passed". After considering the observations of the Supreme Court in Indian Bank Association and ors. (supra), ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exercised after considering the further fact that apart from the sentence of imprisonment, the Court has jurisdiction under Section 357(3) Cr.P.C. to award suitable compensation with default sentence under Section 64 IPC and with further powers of recovery under Section 431 Cr.P.C. With this approach, prison sentence of more than one year may not be required in all cases. 18.5. Since evidence of the complaint can be given on affidavit, subject to the Court summoning the person giving affidavit and examining him and the bank's slip being prima facie evidence of the dishonour of cheque, it is unnecessary for the Magistrate to record any further preliminary evidence. Such affidavit evidence can be read as evidence at all stages of trial or other proceedings. The manner of examination of the person giving affidavit can be as per Section 264 Cr.P.C. The scheme is to follow summary procedure except where exercise of power under second proviso to Section 143 becomes necessary, where sentence of one year may have to be awarded and compensation under Section 357(3) is considered inadequate, having regard to the amount of the cheque, the financial capacity and the conduct of the accused ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is open for the Court to ask specific questions to the accused at that stage. 18. In my opinion, the Supreme Court in Meter and Instruments Private Limited and anr. (supra) has not at all diluted the proposition laid down in Mandvi Cooperative Bank Limited (supra) that "the accused, however, is fully protected and under sub-section (2) of section 145 of the NI Act, he has absolute and unqualified right to have the complainant and any or all of his witnesses summoned for cross examination". The Supreme Court has not curtailed the right of the accused to have the complainant summoned for cross examination. The need to disclose specific defence for such contest is to discourage the accused from prolonging the trial unnecessarily. It is only to ensure that the accused does not contest the case on a sham defence or absent any defence. It is open for the Court to ask specific questions at that stage. 19. The accused has right to a fair trial. Once it is recognised that the accused has absolute and unqualified right to have the complainant and any or all of his witnesses summoned for cross-examination, the applicant cannot be deprived of such a right unless there are some extraordinary ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Supreme Court in the case of Mandvi Cooperative Bank Limited (supra), since the accused is fully protected under sub-section 2 of section 145 and has absolute and unqualified right to have the complainant and any or all of his witnesses summoned for cross- examination, it is not necessary for the trial Court to delve deep into the merits of the defence which is set up by the accused. The order of the trial Court on an application under section 145(2) cannot in any manner have the effect of defeating the absolute and unqualified right of the accused to cross examine the complainant. 22. For guidance, a profitable reference needs to be made to the decision of the Supreme Court in Re: Expeditious Trial of Cases under Section 138 of N.I. Act, 1881 in Suo Motu Writ Petition (CRL.) No. 2 of 2020 dated 16/04/2021. Having regard to the humongous pendency of complaints under section 138 of NI Act and the delay in disposal of complaints that the Supreme Court in paragraph 24 concluded as under : "24. The upshot of the above discussion leads us to the following conclusions: 1) The High Courts are requested to issue practice directions to the Magistrates to record reasons before c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act shall also be considered by the Committee." 23. It is thus seen that in paragraph 7, Their Lordships have observed that section 258 of the Code is not applicable to the complaints under section 138 of the Act and the findings to the contrary in Meters and Instruments Private Limited and anr. (supra) do not lay down correct law. The decision in Meters and Instruments Private Limited otherwise holds the field. 24. In compliance of the order of the Hon'ble Supreme Court of India dated 16/04/2021 passed in Suo Motu Writ Petition (CRL.) No. 2 of 2020, the Hon'ble Chief Justice of the High Court of Bombay issued the following practice directions by a Circular dated 27/01/2022 reading thus : "1. The magistrates having jurisdiction to try offences under the Negotiable Instruments Act, 1881 (in short N.I. Act), shall record cogent and sufficient reasons before converting a complaint under section 138 of the N.1. Act from summary trial to summons trial in exercise of power under the second proviso of section 143 of N.I. Act. Due care and caution shall be exercised in this regard and the conversion of summary trial to summons trial shall not be in a mechanical manner. 2. On receip ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aimed by the complainant nor there exist any legally enforceable debt as claimed by the complainant. The accused further states that no notice as contemplated under the NI Act was even received by the accused. 3. The accused states that in order to substantiate his above stated defence the accused wishes to cross-examine the complainant in relation to the contents of the affidavit filed." 26. The trial Court, in my opinion, committed error in observing that the petitioner is silent on the specific ground of defence or point on which he wishes to cross examine the complainant. It may be that the petitioner has an opportunity to lead defence evidence and rebut the presumption if any, however, that does not mean that the valuable right of the petitioner to cross examine the complainant which he is entitled to under section 145(2) of the NI Act can be lightly brushed aside. The averments made in the application Exhibit D-33 are sufficient to bring the case of the petitioner within the ambit of the expression 'setting up a specific defence' in terms of what is held by the Supreme Court in Meters and Instruments Private Limited and anr. (supra). At this stage, nothing more is expect ..... 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