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TMI Blog2023 (5) TMI 425X X X X Extracts X X X X X X X X Extracts X X X X ..... gotiable Instruments Act, 1881 (hereinafter 'NI Act') in CT Case No. 11160/2017 titled as "Arun Malhotra v. Gulshan Arora & Anr." 2.1. The petitioners, vide judgment dated 22.10.2021, were held guilty under Section 138 of NI Act by the Court of learned MM (NI Act-03)/South, Saket Courts, New Delhi (hereinafter 'Trial Court') and the concluding portion of said judgment reads as under: "...Conclusion: 25. In view of the foregoing discussion, this court holds that complainant has established his case beyond reasonable doubt by proving all the ingredients under Section 138 NI Act and the accused persons have failed to raise a probable defence. 26. Accused Gulshan Arora and Gaurav Arora are hereby convicted for offence punishable under Section 138 NI Act qua the cheque in question in the present case..." 2.2. The learned Trial Court vide order dated 18.11.2021, sentenced the petitioners to payment of fine of Rs. 27,20,000/-, to be paid within 45 days to the complainant, and in default of such payment of fine, to undergo a simple imprisonment for a period of six months. The relevant portion of this order reads as under: "8. In the totality of the aforesaid facts and circum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m amount of Rs. 20% is to be deposited within 60 days from the date of order on sufficient cause being shown, a further period of 30 days may be granted. Hence, it can be seen that the court may grant a maximum period of 90 days for compliance of the said order, which in the present case have clearly lapsed. Even no explanation has been given by counsel for the appellants as to why she did not exercise the right of revision earlier or why no steps have been taken to remove the defects in filing the revision. No relief can be granted on such casual attitude. Granting further time will defeat the very objective with which section 148 NI ACT was inserted in NI ACT 1881 and in the opinion of this court, non compliance of the said order is sufficient to declare order of suspension of sentence vacated. Accordingly, the stay on order of sentence imposed by my Ld. Predecessor vide order dt. 17.12.2021 is vacated. Both the appellants are directed to surrender before the concerned Trial Court/Successor Court within a period of 7 days to serve the sentence awarded by the Ld. Trial Court vide order of sentence dt. 18.11.2021..." 6. Aggrieved by the orders of learned Appellate Court, the petit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It is further argued that as rightly held by Appellate Court, non-payment of such fine would dis-entitle the petitioners to enjoy the suspension of sentence during the entire period of pendency of their Appeal. It is also argued that the judgment dated 22.10.2021 vide which the petitioners were convicted under Section 138 NI Act also does not suffer from any illegality and, thus, no special circumstances exist in order to exempt the petitioners from depositing the amount as per Section 148 NI Act. 10. This Court has heard arguments on behalf of both sides and has perused the material placed on record. 11. The relief, in a nutshell, prayed before this Court is, firstly waiving off the payment of 20% of amount of fine imposed upon the petitioners as per section 148 NI Act and secondly, setting aside the order whereby suspension of sentence was ordered to be vacated due to non-payment of said amount. 12. Since the issue for consideration before this Court primarily relates to Section 148 of NI Act, 1881, it would be appropriate to first refer to the same. The said provision is reproduced as under: "148. Power of Appellate Court to order payment pending appeal against conviction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or compensation awarded by the trial court...... 8. Now so far as the submission on behalf of the appellants that even considering the language used in Section 148 of the NI Act as amended, the appellate court "may" order the appellant to deposit such sum which shall be a minimum of 20% of the fine or compensation awarded by the trial court and the word used is not "shall" and therefore the discretion is vested with the first appellate court to direct the appellant-accused to deposit such sum and the appellate court has construed it as mandatory, which according to the learned Senior Advocate for the appellants would be contrary to the provisions of Section 148 of the NI Act as amended is concerned, considering the amended Section 148 of the NI Act as a whole to be read with the Statement of Objects and Reasons of the amending Section 148 of the NI Act, though it is true that in the amended Section 148 of the NI Act, the word used is "may", it is generally to be construed as a "rule" or "shall" and not to direct to deposit by the appellate court is an exception for which special reasons are to be assigned. Therefore amended Section 148 of the NI Act confers power upon the appell ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itioners herein seek a waiver of the condition imposed upon them to deposit 20% of the fine during the pendency of their appeal against conviction. As stated in preceding para, this prayer can only be allowed in case the Court arrives at a conclusion that there are special circumstances and reasons to do so. 15.1. The primary ground of the petitioners for seeking such a waiver, is that on the same day when the judgment convicting the petitioners under Section 138 was passed in CT Case No. 11160/2017, the petitioners, vide another judgment in CT Case No. 27782/2019, were acquitted of the same offence by the learned Trial Court. It is stated that both these cases had arisen out of same set of facts and transactions and between the same parties, and even the learned Trial Court while acquitting the petitioners in another case had taken note of the contradictions and lacunae in the case of the respondent no. 2 who was stating two different set of facts with respect to the same transaction in two cases. 15.2. By way of reply to the application under Section 148 of NI Act, the petitioners had also raised the aforesaid contentions before the Appellate Court, and the Appellate Court after ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... files an appeal against conviction, believes to have a good case for acquittal. This, by no stretch of imagination, can be held to fall within the purview of "special reasons" to allow a convict under Section 138 to not deposit a portion of the fine imposed upon him during the pendency of appeal. Allowing such a prayer would be against the purpose, intent and mandate of Section 148, which was well-explained by the Apex Court in Surinder Singh Deswal-I (supra),as mentioned in para 13 of this judgment. 16. Another relief sought before this Court relates to quashing of order dated 06.01.2023 passed by the learned Appellate Court whereby the suspension of sentence of the petitioners was vacated upon their failure to deposit the 20% of fine amount and they were asked to surrender within 7 days. 17. The legal position with respect to imposition of condition to deposit a percentage of fine/compensation amount while granting suspension of sentence in a case under Section 138 of NI Act, was explained by the Hon'ble Apex Court in case of Surinder Singh Deswal v. Virender Gandhi (2020) 2 SCC 514 (hereinafter 'Surinder Singh Deswal-II') as under: "19. The High Court is right in its opinio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ustice is caused to the payee of a dishonoured cheque who has to spend considerable time and resources in court proceedings to realise the value of the cheque. Such delays compromise the sanctity of cheque transactions. 2. It is proposed to amend the said Act with a view to address the issue of undue delay in final resolution of cheque dishonour cases so as to provide relief to payees of dishonoured cheques and to discourage frivolous and unnecessary litigation which would save time and money. The proposed amendments will strengthen the credibility of cheques and help trade and commerce in general by allowing lending institutions, including banks, to continue to extend financing to the productive sectors of the economy..." 19. Thus, it can be held that the aim of this provision was to provide a certain degree of relief to the complainant who would have suffered due to dishonor of the cheque. Since an appellant is convicted under Section 138 after going through a detailed procedure and appreciation of evidence, in such circumstances, Section 148 NI Act makes way for some relief to the complainant by empowering the Appellate Court to direct payment of some portion of the fine/com ..... X X X X Extracts X X X X X X X X Extracts X X X X
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