Two new sections under the Negotiable Instruments Act, 1881 (Act) have come into force with effect from 01.09.2018 by way of Amendment Act No. 20:
S.143-A gives the Magistrate trying an offence under the Act the discretion to award interim compensation to the complainant against the drawer up to a maximum of 20% of the cheque amount after notice/charge has been framed upon an accused and he pleads not guilty.
S.148 provides that in an appeal by the drawer/accused against a conviction under Section 138, the appellate court may direct the appellant to deposit a minimum of 20% of the compensation awarded by the trial court.
As per Section 5 of the General Clauses Act, 1897 no new act shall apply retrospectively unless the same is specifically expressed. Therefore, the amendments should not affect those cases where complaints have been instituted prior to 01.09.2018. Complainants have however tried to take advantage of the new amended sections and moved applications in complaints filed prior to 01.09.2018 seeking interim compensation. While appellate courts during the course appeals arising from complaints instituted prior to 01.09.2018 have been ordering a deposit of a minimum of 20% of the compensation awarded by the trial courts.
How have courts across India responded to the new amendments and do they apply to those cases where complaints instituted prior to 01.09.2018?
"in the present case, the impugned orders are passed on 03.08.2018 by the learned Magistrate and the amendment came into force on 01.09.2018. Obviously, in the order dated 03.08.2019, Section 148 is not mentioned by the learned Additional Sessions Judge. He did not intend to pass the order under Section 148 but it is to be understood that the learned sessions judge passed the order under the Code of Criminal Procedure by using the powers of the criminal court to impose putting condition at the time of granting bail."
Even though, the impugned order did not consider S. 148 of the Act, the High Court while hearing the challenge to the same thought it fit to refer to the same.
"when the enactment has been made as a beneficial legislation, to protect the interest of the complainant and to provide a relief and to avoid and discourage frivolous appeals and litigation, then under such circumstances, a wider interpretation has to be made and not a restricted interpretation as held in the case of S. L. Srinivasa Jute Twine Mills (P) Ltd. v. Union of India and Another (cited supra). It is not express provision which has to be taken into consideration but it can take even the necessary implication and give retrospective operation. In that light, this court can give the retrospective effect to the said Section.".
"Since provisions for recovery of fine or compensation from the appellant/convict already existed in the existing procedure relating to the recovery, therefore the provision introduced vide Section 148 of the Act; which relates only to recovery of amount partly, as interim measure, has to be treated purely procedural only, which is otherwise also beneficial for the appellant as compared to the pre-existing provisions."
The Madras High Court, in G.J.Raja v. Tejraj Surana, upheld the order of a magistrate directing the accused to pay 20% of the cheque amount as interim compensation to the complainant. The High Court judgment does not disclose whether the complaint was filed prior to or post the amendment. The judgment of the High Court is now under challenge before the Supreme Court in SLP (Crl.) No. 3342/2019. The order where by notice was issued in the Supreme Court gives a clear indication of the factual position:
"Issue involved in this matter is whether Section 143-A introduced by the Amendment Act No.20 of 2018 in the Negotiable Instruments Act, 1881 has retrospective application or not?"
An examination of these judgments shows that the majority view is that S.148 does apply retrospectively whereas on S.143-A there is no such consensus. The Supreme Court will now surely clear the air over the retrospective application of Section 143-A of the Act.
Shiv Chopra is an advocate practicing in Delhi.
[The opinions expressed in this article are the personal opinions of the author. The facts and opinions appearing in the article do not reflect the views of LiveLaw and LiveLaw does not assume any responsibility or liability for the same]
 2019 SCC OnLine SC 739
 2019 SCC OnLine Bom 436
 I.A. No. 3/2018 in Criminal Revision Petition No. 425/2018
 2019 SCC OnLine P&H 747