'Amend Section 138 NI Act To Allow One Trial For Multiple Cases From Single Transaction' : Supreme Court Issues Directions For Expeditious Trial Of Cheque Cases

A constitution bench of the Supreme Court on Friday issued a set of directions to expedite the trial of cheque dishonour cases under Section 138 of the Negotiable Instruments Act.The directions are as follows :The High Courts are requested to issue practice directions to the Magistrates to record reasons before converting trial of complaints under Section 138 of the Act from summary trial to summons trial.Inquiry shall be conducted on receipt of complaints under Section 138 of the Act to arrive at sufficient grounds to proceed against the accused, when such accused resides beyond the territorial jurisdiction of the court.For the conduct of inquiry under Section 202 of the Code,evidence of witnesses on behalf of the complainant shall be permitted to be taken on affidavit. In suitable cases, the Magistrate can restrict the inquiry to examination of documents without insisting for examination of witnessesWe recommend that suitable amendments be made to the Act for provision of one trial against a person for multiple offences under Section 138 of the Act committed within a period of 12 months, notwithstanding the restriction in Section 219 of the Code.The High Courts are requested to issue practice directions to the Trial Courts to treat service of summons in one complaint under Section 138 forming part of a transaction,as deemed service in respect of all the complaints filed before the same court relating to dishonour of cheques issued as part of the said transaction.Judgments of the Court in Adalat Prasad v Rooplal Jindal and others (2004) 7 SCC 338 and Subramanium Sethuraman v State of Maharashtra (2004) 13 SCC 324 have interpreted the law correctly and we reiterate that there is no inherent power of Trial Courts to review or recall the issue of summons.This does not affect the power of the Trial Court under Section 322 of the Code to revisit the order of issue of process in case it is brought to the court's notice that it lacks jurisdiction to try the complaint.Section 258 of the Code is not applicable to complaints under Section 138 of the Act and findings to the contrary in Meters and Instruments Private Ltd and Another v Kanchan Mehta and others (2018) 1 SCC 560 do not lay down correct law. To conclusively deal with this aspect, amendment to the Act empowering the Trial Courts to reconsider/recall summons in respect of complaints under Section 138 shall be considered by the Committee constituted the Court on 10.03.2021The order was passed by a bench comprising Chief Justice of India SA Bobde, Justices L Nageswara Rao, BR Gavai, AS Bopanna and S Ravindra Bhat in the suo moto case In re Expeditious Trial of Cases Under Section 138 NI Act.The Court passed these directions accepting some of the recommendations made in the preliminary report submitted by amici curiae Senior Advocates Siddharth Luthra, R Basant and Advocate K Parameshwar(the report may be read here).On March 10, the bench had formed a committee of experts headed by former Bombay High Court judge Justice RC Chavan to suggest steps to expedite trial in cheque dishonour cases.CJI SA Bobde, while reading out the operative portions of the judgment today, said that the suggestions in the preliminary report, which have not been considered by the Court, will be subject to further deliberations by the Committee.The case will be listed after eight weeks.Send cases for mediationThe Court directed the High Courts and the appellate courts to immediately send the appeals/revisions for mediation."We request the High Courts to identify the pending revisions arising out of complaints filed under Section 138 of the Act and refer them to mediation at the earliest. The Courts before which appeals against judgments in complaints under Section 138 of the Act are pending should be directed to make an effort to settle the disputes through mediation"During the hearing, the bench had also observed prima facie that the Central Government has the obligation to create additional courts to ease the burden created on the judicial system by the Negotiable Instruments Act, as per the mandate of Article 247 of the Constitution.It was on March 7 last year that the bench of CJI Bobde and Justice L Nageswara Rao registered the suo moto case to devise methods for expeditious trial of Section 138 NI Act cases.Senior Advocates Sidharth Luthra, R Basant and Advocate K Parameshwar were appointed as amici curiae in the case. They have submitted a preliminary report after consulting High Courts and States(the report may be read here).Case DetailsTitle : In Re Expeditious Trial Of Cases Under Section 138 of N.I Act Coram : Chief Justice of India SA Bobde, Justices L Nageswara Rao, BR Gavai, AS Bopanna and S Ravindra Bhat Appearances :Senior Advocates Sidharth Luthra, R Basant and Advocate K Parameshwar amici curiaeCitation : LL 2021 SC 217 Click here to read/download the...

'Amend Section 138 NI Act To Allow One Trial For Multiple Cases From Single Transaction' : Supreme Court Issues Directions For Expeditious Trial Of Cheque Cases

LIVELAW NEWS NETWORK

This is a premium content
Available exclusively to
Our subscribers

INR 1099+GST

Tags

LIVELAW NEWS NETWORK

'Amend Section 138 NI Act To Allow One Trial For Multiple Cases From Single Transaction' : Supreme Court Issues Directions For Expeditious Trial Of Cheque Cases

LIVELAW NEWS NETWORK

This is a premium content Available exclusively to Our subscribers

INR 1099+GST

Tags

LIVELAW NEWS NETWORK

This is a premium content
Available exclusively to
Our subscribers