- (a) "परक्राम्य लिखत अधिनियम, 1881 की धारा 138 का उद्देश्य बैंक प्रचालनों की दक्षता को प्रोत्साहित करना और चेकों द्वारा कारबारी संव्यवहार में प्रत्येयता को सुनिश्चित करना है।" नवीन संशोधनों के साथ इस कथन की व्याख्या कीजिए। "The objective of Section 138 of the Negotiable Instruments Act, 1881 is to promote the efficiency of banking operations and to ensure credibility in transacting business through cheques." Explain the statement with recent amendments.
Verified Answer
- Core Legal Answer & Context: The statement accurately encapsulates the primary objectives behind the introduction of Section 138 into the Negotiable Instruments Act, 1881. Prior to its enactment, the dishonour of cheques was largely a civil wrong, leading to protracted litigation and undermining public confidence in cheques as a reliable mode of payment. Section 138 was specifically introduced to criminalize the act of dishonour of cheques due to insufficiency of funds, thereby instilling a sense of fear and responsibility in drawers. This legislative intent was to:
- Promote the efficiency of banking operations: By ensuring that cheques, which are integral to modern banking, are honored, it facilitates smoother and more efficient financial transactions.
- Ensure credibility in transacting business through cheques: By providing a swift and effective legal recourse against defaulting drawers, it enhances the trustworthiness and acceptability of cheques as a negotiable instrument for commercial and personal transactions. It aims to deter individuals from issuing cheques without sufficient funds, thereby fostering a culture of financial discipline and accountability.
- Relevant Statutes and Sections:
- Negotiable Instruments Act, 1881:
- Section 138: Defines the offence of dishonour of cheque for insufficiency of funds, prescribing punishment of imprisonment up to two years, or fine up to twice the cheque amount, or both.
- Section 139: Presumption in favour of the holder that the cheque was received for the discharge of a debt or other liability.
- Section 142: Lays down the conditions for taking cognizance of the offence.
- Negotiable Instruments (Amendment) Act, 2018: Introduced two crucial sections:
- Section 143A: Empowers the court to order the drawer of a cheque to pay interim compensation to the complainant during the pendency of the trial. This interim compensation can be up to 20% of the cheque amount and must be paid within 60 days (extendable by 30 days).
- Section 148: Empowers the appellate court to order the appellant (convicted drawer) to deposit a minimum of 20% of the fine or compensation awarded by the trial court, in addition to any interim compensation paid under Section 143A, before the appeal is heard. This amount is to be released to the complainant upon acquittal or reversal of conviction, with interest.
- Important Landmark Cases:
- Meters and Instruments Private Limited v. Kanchan Mehta (2018): The Supreme Court, while dealing with the issue of compounding of offences under Section 138, emphasized the need for a pragmatic approach to ensure that the purpose of the Act is served, which is to ensure that cheques are honored.
- Surinder Singh Deswal @ Col. S.S. Deswal v. Virender Gandhi (2019): The Supreme Court upheld the constitutional validity of Sections 143A and 148 of the NI Act, as amended in 2018. It clarified that the provisions for interim compensation and deposit during appeal are retrospective in nature, applying to cases filed even before the amendment, provided the trial or appeal is still pending.
- Clear Conclusion: Section 138 of the Negotiable Instruments Act, 1881, has been instrumental in bolstering the credibility of cheques and promoting efficient banking practices by providing a strong deterrent against dishonour. The recent amendments introduced by the Negotiable Instruments (Amendment) Act, 2018, particularly Sections 143A and 148, have further strengthened the complainant's position by providing for interim compensation and mandatory deposit during appeal. These amendments aim to reduce delays in justice, discourage frivolous appeals, and ensure that the legislative intent of making cheques a reliable instrument of commerce is effectively realized.