{"id":258949,"date":"2021-12-23T17:00:15","date_gmt":"2021-12-23T11:30:15","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=258949"},"modified":"2021-12-23T15:22:40","modified_gmt":"2021-12-23T09:52:40","slug":"magistrate-required-to-exercise-judicious-discretion-before-ordering-interim-compensation","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2021\/12\/23\/magistrate-required-to-exercise-judicious-discretion-before-ordering-interim-compensation\/","title":{"rendered":"Magistrate required to exercise judicious discretion before ordering interim compensation, S. 143-A NI Act not mandatory: Kar HC"},"content":{"rendered":"

Karnataka High Court:<\/strong> Rajendra Badamikar, J.,\u00a0reversed an order of the Magistrate which had directed the petitioner accused to deposit 20% of the cheque amount before the court. The High Court said that Section 143-A of the Negotiable Instruments Act, 1881 is not a mandatory provision.<\/p>\n

Factual Matrix<\/span><\/h4>\n

The respondent herein had filed a private complaint before the Trial Court against the present petition for the offence punishable under Section 138 of the Negotiable Instruments Act, 1881.<\/p>\n

As per the Respondent-Complainant, the petitioner accused had taken a hand loan of Rs 9 lakhs from the complainant in order to purchase a plot. But the sale deed was not executed and when complainant requested the accused-petitioner for repayment of the amount or else to execute the sale deed he issued a cheque and when the said cheque was presented through the banker of the complainant it was returned for insufficient funds.<\/p>\n

Further, it was alleged that the complainant issued a legal notice calling upon the petitioner for payment within 15 days, but he failed to make any payment as such he filed a private complaint under Section 138 of NI Act.<\/p>\n

Magistrate passed the impugned order directing the accused-petitioner to deposit 20% of the cheque amount before the Court.<\/p>\n

Analysis, Law and Decision<\/span><\/h4>\n

High Court noted that the complaint was filed under Section 138 of NI Act in respect of bouncing of cheque issued by present accused of a sum of Rs 9 lakhs. After recording the sworn statement, the Magistrate took cognizance and issued the process against the accused\/petitioner who appeared and enlarged on bail.<\/p>\n

Present petitioner appeared before the Trial Court and was enlarged on bail and the matter was adjourned to 28-11-2019 for recording the plea. On that date, the counsel for the complainant\/respondent herein filed an application under Section 143A of NI Act.<\/p>\n

Magistrate\u2019s order disclosed that as per the mandatory provisions of Section 143A he passed the impugned order for deposit of 20% of the cheque amount. It was noted that he did not hear the counsel for the accused and no opportunity of being heard was given to him.<\/p>\n

Bench expressed that,<\/p>\n

Section 143A (1) is not a mandatory provision and it says that Court may order the drawer of the cheque to pay the interim compensation as per conditions stipulated there under.<\/p>\n

It was evident that the power under Section 143A was vested with the magistrate to be exercised judiciously after recording the plea and it was not mandatory, but the Magistrate was required to exercise his judicious discretion under Section 143A of the Act.<\/p>\n

But in the instant case, the impugned order disclosed that the Magistrate had not even applied his mind and in a mechanical way as per the mandatory provisions of Section 143A he has directed the accused to deposit 20% of the cheque amount. The provisions of Section 143A are not mandatory but the discretion was given to the magistrate to be exercised judiciously.<\/em><\/p>\n

In Court\u2019s opinion, the entire approach of the Magistrate was against the settled principles of natural justice and he did not even pass a summary speaking order giving reasons for passing such an order.<\/p>\n

The order itself disclose that he carried on impression that Section 143(A) of the Act is a<\/span><\/p>\n

mandatory provision of law but ignored the fact that the word used in the Section is \u2018may\u2019 and not \u2018shall\u2019 which gives a discretion to the Court to be exercised in a judicious way.<\/span><\/p><\/blockquote>\n

\u00a0<\/em>Therefore, the entire approach of magistrate was against the settled principles and the impugned order called for interference. [Jahangir v. Farooq Ahmed Abdul Razak, Criminal Petition No. 201213 of 2020, decided on 6-7-2021]<\/p>\n

\n

Advocates before the Court:<\/strong><\/p>\n

For the Petitioner: Sanjay A. Patil, Advocate<\/p>\n

For the Respondent: S.S. Mamadapur, Advocate<\/p>\n","protected":false},"excerpt":{"rendered":"

Karnataka High Court: Rajendra Badamikar, J.,\u00a0reversed an order of the Magistrate which had directed the petitioner accused to deposit 20% of the <\/p>\n","protected":false},"author":8808,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3,10],"tags":[2664,2862,33385,29785,42834,30292,2538,2805,23584,48145],"class_list":["post-258949","post","type-post","status-publish","format-standard","hentry","category-casebriefs","category-highcourts","tag-Bail","tag-dishonour_of_cheque","tag-insufficient-funds","tag-law","tag-legal-news","tag-loan","tag-Magistrate","tag-natural_justice","tag-section-138-ni-act","tag-section-143a-ni-act"],"yoast_head":"\nMagistrate required to exercise judicious discretion before ordering interim compensation, S. 143-A NI Act not mandatory: Kar HC | SCC Times<\/title>\n<meta name=\"description\" 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Petitioners were stated to be the directors as per the complaints i.e. CC NI Act 12-20 and CC NI Act 100-20 filed by the respondent\u2026","rel":"","context":"In "Case Briefs"","block_context":{"text":"Case Briefs","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":269136,"url":"https:\/\/www.scconline.com\/blog\/post\/2022\/06\/28\/karnataka-high-court-magistrates-to-consider-conduct-of-accused-while-deciding-application-for-interim-compensation-in-cheque-dishonour-cases\/","url_meta":{"origin":258949,"position":2},"title":"Karnataka High Court| Magistrates to consider ‘conduct of Accused’ while deciding application for interim compensation in Cheque dishonour cases","author":"Editor","date":"June 28, 2022","format":false,"excerpt":"Karnataka High Court: M. Nagarprasanna J. allowed a petition filed under Section 482 of Criminal Procedure Code, 1973 (CrPC) seeking quashing of the impugned order passed by the Additional Chief Metropolitan Magistrate. Therefore, the magistrate court directed that interim compensation be given as per the \u201cconduct of the accused\u201d for\u2026","rel":"","context":"In "Case Briefs"","block_context":{"text":"Case Briefs","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/"},"img":{"alt_text":"Karnataka High Court","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2022\/04\/New_Karnataka.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2022\/04\/New_Karnataka.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2022\/04\/New_Karnataka.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2022\/04\/New_Karnataka.jpg?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2022\/04\/New_Karnataka.jpg?resize=1050%2C600&ssl=1 3x"},"classes":[]},{"id":218529,"url":"https:\/\/www.scconline.com\/blog\/post\/2019\/08\/23\/del-hc-complaint-under-s-138-ni-act-dismissed-for-non-prosecution-restored-considering-that-clerk-of-complainants-counsel-noted-wrong-date\/","url_meta":{"origin":258949,"position":3},"title":"Del HC | Complaint under S. 138 NI Act dismissed for non-prosecution restored considering that clerk of complainant’s counsel noted wrong date","author":"Bhumika Indulia","date":"August 23, 2019","format":false,"excerpt":"Delhi High Court:\u00a0Mukta Gupta, J. allowed a petition filed against the order of the trial Judge whereby the petitioner's complaint filed for the commission of offence under Section 138\u00a0(dishonour of cheque)\u00a0of the Negotiable Instruments Act, 1881, was dismissed for non-prosecution. The petitioner had advanced a loan to the respondent who\u2026","rel":"","context":"In "Case Briefs"","block_context":{"text":"Case Briefs","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":207213,"url":"https:\/\/www.scconline.com\/blog\/post\/2018\/12\/25\/presumption-under-section-118-of-ni-act-may-legally-be-inferred-where-where-signature-on-cheque-admitted-by-accused\/","url_meta":{"origin":258949,"position":4},"title":"Presumption under Section 118 of NI Act may legally be inferred where signature on cheque admitted by accused","author":"Bhumika Indulia","date":"December 25, 2018","format":false,"excerpt":"Bombay High Court: A Single Judge bench comprising of M.G. Giratkar, J. dismissed a revision petition filed against the judgment of Judicial Magistrate and confirmed by Additional Sessions Judge, Nagpur whereby the petitioner was convicted for offence punishable under Section 138 of Negotiable Instruments Act, 1881. The petitioner and the\u2026","rel":"","context":"In "Case Briefs"","block_context":{"text":"Case Briefs","link":"https:\/\/www.scconline.com\/blog\/post\/category\/casebriefs\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/09\/Bombay-HC.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/09\/Bombay-HC.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/09\/Bombay-HC.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/09\/Bombay-HC.jpg?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/www.scconline.com\/blog\/wp-content\/uploads\/2016\/09\/Bombay-HC.jpg?resize=1050%2C600&ssl=1 3x"},"classes":[]},{"id":250414,"url":"https:\/\/www.scconline.com\/blog\/post\/2021\/06\/29\/section-138-ni-act-7\/","url_meta":{"origin":258949,"position":5},"title":"Del HC | Can mere ipse dixit and statement in defence under S. 313 CrPC rebut presumption cast under S. 139 NI Act? 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