Amendment to Section 148 of Negotiable Instruments Act applies retrospectively - (29 May 2019)

Criminal

In a recent decision, the Supreme Court, while hearing a case namely Surinder Singh Deswal @ S.S. Deswal & Ors. v. Virender Gandhi held that, Section 148 of the Negotiable Instruments Act (N.I. Act) as amended, shall be applicable in respect of the appeals against the order of conviction and sentence for the offence under Section 138 of the N.I. Act, even in a case where the criminal complaints for the offence under Section 138 of the N.I. Act were filed prior to amendment Act No. 20/2018 i.e., prior to 1st September, 2018. The Supreme Court was of the view that, if such a purposive interpretation is not adopted, in that case, the object and purpose of amendment in Section 148 of the N.I. Act would be frustrated.

The object of the Parliament in bringing amendment in Section 148 of the N.I. Act, as amended by way of Amendment Act No. 20/2018 was based on the premise that, due to delay tactics of unscrupulous drawers of dishonoured cheques and due to easy filing of appeals and obtaining stay on proceedings, injustice is caused to the payee of a dishonoured cheque and such delays compromise the sanctity of cheque transactions. Therefore, the said amendment was brought into effect.

The Appellants was directed to deposit 25% of the amount of compensation, in view of the provisions of amended Act No. 20 of 2018 in Section 148 of the N.I. Act. The case of the Appellants before Supreme Court was that Section 148 of the N.I. Act, as amended by Act No. 20/2018, shall not be applicable with respect to criminal proceedings already initiated prior to the amendment in Section 148 of the N.I. Act. However, the Supreme Court rejected the said contention and held that considering the object and purpose of amendment in Section 148 of the N.I. Act and while suspending the sentence in exercise of powers under Section 389 of the Code of Criminal Procedure, 1973 (CrPC), when the first appellate Court directed the Appellants to deposit 25% of the amount of fine/compensation as imposed by the trial Court, the same can be said to be absolutely in consonance with the Statement of Objects and Reasons of amendment in Section 148 of the N.I. Act.

The Supreme Court further observed that, by the amendment in Section 148 of the N.I. Act, it cannot be said that any vested right of appeal of the accused – Appellant has been taken away and/or affected. Thus, by clarifying the aforesaid position, the Supreme Court has given major relief to lacs of bonafide victims of cheque bounce for their speedy disposal of cases.

Tags : ENACTMENT AMENDMENT APPLICABILITY