SURINDER SINGH DESWAL @ COL. S.S. DESWAL AND OTHERS versus VIRENDER GANDHI on 29 May 2019

746

SUPREME COURT REPORTS

[2019] 8 S.C.R.

ASURINDER SINGH DESWAL @ COL. S.S. DESWAL ANDOTHERS

v.

VIRENDER GANDHI

(Criminal Appeal Nos. 917-944 of 2019)

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MAY 29, 2019

[M. R. SHAH AND A. S. BOPANNA, JJ.]

Negotiable Instruments Act, 1881: ss.138, 148 – Deposit offine or compensation for suspension of sentence – Whether s.148Cas amended by Act no.20/2018 shall not be applicable with respectto criminal proceedings already initiated prior to the amendment tos.148 of NI Act – Held: s.148 as amended, shall be applicable inrespect of the appeals against the order of conviction and sentencefor the offence under s.138, even in a case where the criminalDcomplaints for the offence under s.138 were filed prior to amendmentAct No. 20/2018 i.e., prior to 01.09.2018 – By the amendment ins.148, it cannot be said that any vested right of appeal of the accusedwas taken away and/or affected – Therefore, submission thatamendment in s.148 shall not be made applicable retrospectively,more particularly with respect to cases/complaints filed prior toE1.9.2018, has no substance as by amendment in s.148, nosubstantive right of appeal was taken away and/or affected –However, in the peculiar facts and circumstances of the instant caseand the fact that the accused-appellants were bonafidely litigatingtheir case and the amount required to be deposited was huge, byFexercising powers under Art.142 of the Constitution, the appellantsis granted four weeks to deposit the amount as was directed by thefirst appellate court – Retrospective effect – Code of CriminalProcedure, 1973 – s.389 – Constitution of India – Art.142.

Negotiable Instruments Act, 1881: s.148 – Amendment ActGNo.20/2018 – Legislative intent – Delay tactics of unscrupulousdrawers of dishonoured cheques resulted in frustrating the objectand purpose of the enactment of s.138 – For this reason Parliamentthought it fit to amend s.148 by which the first appellate Court, inan appeal challenging the order of conviction under s.138 wasconferred with the power to direct the convicted accused-appellantH

to deposit such sum which shall be a minimum of 20% of the fine orcompensation awarded by the trial Court – Interpretation of statutes– Purposive interpretation – Legislative Intent.

Dismissing the appeals, the Court

HELD: 1. By the amendment in Section 148 of the N.I.Act, it cannot be said that any vested right of appeal of theaccused-appellant has been taken away and/or affected.Considering the Statement of Objects and Reasons of theamendment in Section 148 of the N.I. Act on purposiveinterpretation of Section 148 of the N.I. Act as amended, Section148 of the N.I. Act as amended, shall be applicable in respect ofthe appeals against the order of conviction and sentence for theoffence under Section 138 of the Act, even in a case where thecriminal complaints for the offence under Section 138 of the N.I.Act were filed prior to amendment Act No. 20/2018 i.e., prior to01.09.2018. [Para 8.1] [757-D, G-H]

2. When the amended Section 148 of the N.I. Act as a wholeis considered with the Statement of Objects and Reasons of theamending Section 148 of the N.I. Act, though it is true that inamended Section 148 of the N.I. Act, the word used is “may”, itis generally to be construed as a “rule” or “shall”. While not todirect to deposit by the appellate court is an exception for whichspecial reasons are to be assigned. Therefore amended Section148 of the N.I. Act confers power upon the Appellate Court topass an order pending appeal to direct the Appellant-Accused todeposit the sum which shall not be less than 20% of the fine orcompensation either on an application filed by the originalcomplainant or even on the application filed by the Appellant-Accused under Section 389 of the Cr.P.C. to suspend thesentence. Therefore, if amended Section 148 of the N.I. Act ispurposively interpreted in such a manner it would serve theObjects and Reasons of not only amendment in Section 148 ofthe N.I. Act, but also Section 138 of the N.I. Act. Due to delaytactics by the unscrupulous drawers of the dishonoured chequesdue to easy filing of the appeals and obtaining stay in theproceedings, an injustice was caused to the payee of adishonoured cheque who has to spend considerable time and A

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Aresources in the court proceedings to realise the value of thecheque and such delay has compromised the sanctity of thecheque transactions, the Parliament has thought it fit to amendSection 148 of the N.I. Act. Therefore, such a purposiveinterpretation would be in furtherance of the Objects and Reasonsof the amendment in Section 148 of the N.I. Act and also SectionB138 of the Act. [Para 9] [758-C-H; 759-A-B]

3. The opening word of amended Section 148 of the N.I.Act is that “notwithstanding anything contained in the Code ofCriminal Procedure…..”. Therefore irrespective of the provisionsof Section 357(2) of the Cr.P.C., pending appeal before the firstCappellate court, challenging the order of conviction and sentenceunder Section 138 of the N.I. Act, the appellate court is conferredwith the power to direct the appellant to deposit such sum pendingappeal which shall be a minimum of 20% of the fine orcompensation awarded by the trial Court. In the facts andDcircumstances of the case and considering the fact that theappellants were bonafidely litigating before this Court challengingthe order passed by the first appellate court, in exercise of powersunder Article 142 of the Constitution of India and in the peculiarfacts and circumstances of the case and the amount to be depositedis a huge amount, further four weeks’ time is granted to theEappellants to deposit the amount as directed by the first appellatecourt. [Paras 10, 11] [759-D-E; 760-A-B]

Garikapatti Veeraya v. N. Subbiah Choudhury AIR 1957SC 540 : [1957] SCR 488 ; Videocon InternationalLimited v. Securities and Exchange Board of IndiaF(2015) 4 SCC 33 : [2015] 3 SCR 1 – held inapplicable.

Dilip S. Dhanukar v. Kotak Mahindra Bank (2007) 6SCC 528 : [2007] 4 SCR 1122 – referred to.

Case Law Reference

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SURINDER SINGH DESWAL @ COL. S.S. DESWAL ANDOTHERS v. VIRENDER GANDHI

CRIMINAL APPELLATE JURISDICTION : Criminal AppealNos. 917-944 of 2019.

From the Judgment and Order dated 24.04.2019 of the High Courtof Punjab and Haryana at Chandigarh in CRM-M No. 3377, 3790, 3828,3857, 3860, 3862, 3864, 3867, 3868, 3869, 3871, 3875, 3888, 3894, 3895,3904, 3906, 3912, 3913, 3921, 3924, 3925, 3926, 3929, 3932, 3949, 4018& 3369 of 2019 (O&M).

Vijay Hansaria, Sr. Adv., Aman Nandrajog, Sumeer Sodhi andSiddharth Sharma, Advs. for the Appellants.

Alok Sangwan, Adv. for the Respondent.

The Judgment of the Court was delivered by

M. R. SHAH, J. 1. Leave granted.

2. As common question of law and facts arise in this group ofappeals and, as such, all these appeals, arise out of the impugned commonjudgment and order passed by the High Court, are being decided anddisposed of together by this common judgment and order.

3. Feeling aggrieved and dissatisfied with the impugned commonorder passed by the High Court of Punjab and Haryana at Chandigarh,by which the High Court has dismissed the respective revisionapplications and has confirmed the order passed by the first appellatecourt – learned Additional Sessions Judge, Panchkula, directing theappellants herein – original appellants – original accused to deposit 25%of the amount of compensation, in view of the provisions of amendedAct No. 20 of 2018 in Section 148 of the Negotiable Instruments Act,1881 (hereinafter referred to as the ‘N.I. Act’), the original appellants –original accused have preferred the present appeals.

4. The facts leading to the present appeals in nutshell are as under:

That criminal complaints were filed against the appellantsherein – original accused for the offence under Section 138 of the N.I.Act. That the said criminal complaints were filed prior to 2.8.2018. Thatthe learned trial Court vide judgment and order dated 30.10.2018 convictedthe appellants for the offence under Section 138 of the N.I. Act andsentenced them to undergo imprisonment of two years and to pay chequeamount + 1% as interest and litigation expenses as fine.

4.1 Feeling aggrieved and dissatisfied with the order of convictionpassed by the learned trial Court, convicting the appellants – originalaccused for the offence under Section 138 of the N.I. Act and the A

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Asentence imposed by the learned trial Court, the appellants – originalaccused have preferred criminal appeals before the first appellateCourt – learned Additional Sessions Judge, Panchkula. In the saidappeals, the appellants – original accused submitted application/s underSection 389 of the Cr. P.C. for suspension of sentence and releasingthem on bail, pending appeal/s.B

4.2 That considering the provisions of amended Section 148 ofthe N.I. Act, which has been amended by Amendment Act No. 20/2018,which came into force w.e.f. 1.9.2018, the first appellate Court, whilesuspending the sentence and allowing the application/s under Section389 of the Cr.P.C, directed the appellants to deposit 25% of the amountCof compensation/fine awarded by the learned trial Court.

4.3 Feeling aggrieved by the order passed by the learned firstappellate Court – learned Additional Sessions Judge, Panchkula directingthe appellants – original accused – original appellants to deposit 25% ofthe amount of compensation/fine awarded by the learned trial Court,Dpending appeal challenging the order of conviction and sentence imposedby the learned trial Court, the appellants approached the High Court ofPunjab and Haryana at Chandigarh by way of revision application/s.

4.4 It was the case on behalf of the appellants that Section 148 ofthe N.I. Act, as amended by Act No. 20/2018, shall not be applicableEwith respect to criminal proceedings already initiated prior to theamendment in Section 148 of the N.I. Act.

4.5 The High Court by a detailed judgment and order has notaccepted the aforesaid contention and has dismissed the revisionapplication/s and has confirmed the order passed by the learned firstFappellate Court – learned Additional Sessions Judge, Panchkula directingthe appellants - original appellants-original accused to deposit 25% ofthe amount of compensation awarded by the learned trial Courtconsidering Section 148 of the N.I. Act, as amended.

4.6 Feeling aggrieved and dissatisfied with the impugned commonGjudgment and order passed by the High Court in dismissing the revisionapplication/s and confirming the order/s passed by the learned firstappellate Court directing the appellants – original appellants – originalaccused to deposit 25% of the amount of compensation awarded by thelearned trial Court under Section 148 of the N.I. Act, as amended, theoriginal appellants – original accused have preferred the present appeals.H

5. Shri Vijay Hansaria, learned Senior Advocate has appeared onbehalf of the appellants – original appellants – original accused and ShriAlok Sangwan, learned Advocate has appeared on behalf of the originalcomplainant.

5.1 Shri Vijay Hansaria, learned Senior Advocate appearing onbehalf of the appellants has vehemently submitted that in the presentcase, both, the High Court as well as the learned first appellate Courthave materially erred in directing the appellants to deposit 25% of theamount of compensation as per Section 148 of the N.I. Act, as amended.

5.2 It is vehemently submitted by the learned Senior Advocateappearing on behalf of the appellants that in the present case as thecriminal proceedings were initiated and the complaints were filed againstthe accused for the offence under Section 138 of the N.I. Act, prior tothe amendment Act came into force, Section 148 of the N.I.Act, asamended shall not be applicable.

5.3 It is further submitted by the learned Senior Advocate appearingon behalf of the appellants that the legal proceedings, whether civil orcriminal, are to be decided on the basis of the law applicable on the dateof the filing of the suit or alleged commission of offence by the trialCourt or the appellate Court, unless the law is amended expressly withretrospective effect, subject to the provisions of Article 20(1) of theConstitution of India. In support of his above submission, learned SeniorCounsel appearing on behalf of the appellants has heavily relied uponthe decisions of this Court in the case of Garikapatti Veeraya v. N.Subbiah Choudhury, reported in AIR 1957 SC 540; and VideoconInternational Limited v. Securities and Exchange Board of India,reported in (2015) 4 SCC 33.

5.4 It is further submitted by the learned Senior Advocate appearingon behalf of the appellants that even otherwise in the present case, thefirst appellate Court has interpreted the word “may” as “shall” in Section148 of the N.I. Act and proceeded on the basis that it is mandatory forthe appellate Court to direct deposit of minimum of 25% of the fine orcompensation awarded by the trial Court for suspension of sentence.

5.5 It is further submitted by the learned Senior Advocate appearingon behalf of the appellants that the first appellate Court heavily reliedupon the decision of the Punjab and Haryana High Court in the case ofM/s Ginni Garments and another v. M/s Sethi Garments (CRR No.

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A9872 of 2018, decided on 04.04.2019), in which it was held that theappellate Court continues to have discretion as to the condition to beimposed or not to be imposed for suspension of sentence and it wasfurther held that however in case discretion is exercised to suspend thesentence subject to payment of compensation/fine, such order mustcommensurate with Section 148 of the N.I. Act. It is submitted, however,Bin the present case, the appellate Court did not exercise discretion andproceeded on the assumption that it is mandatory to deposit 25% of thefine or compensation as a condition for suspension of sentence. It issubmitted that therefore the High Court ought to have remanded thematter back to the appellate Court to decide on the question of suspensionCof sentence as per the decision in the case of M/s Ginni Garments(supra).

5.6 It is further submitted by the learned Senior Advocate appearingon behalf of the appellants that a similar view is taken by the BombayHigh Court in the case of Ajay Vinodchandra Shah v. The State ofDMaharashtra (Criminal Writ Petition No. 258 of 2019). It is submittedthat in the said decision, the Bombay High Court has also observed andheld that as per Section 148 of the N.I. Act as amended, the appellateCourt has the discretion to direct deposit the sum pending appeal, but ifat all such direction is given, that sum shall not be less than 20% of theamount of fine or compensation awarded by the trial Court. It is submittedEthat in the present case, the appellate Court wrongly presumed that therequirement under Section 148 of the N.I. Act is the deposit of 25% ofthe fine or compensation.

5.7 It is further submitted by the learned Senior Advocate appearingon behalf of the appellants that in the present case the learned trialFCourt imposed the fine under Section 138 of the N.I. Act, equal to theamount of cheque plus 1%. It is submitted that as per Section 357(2) ofthe Cr.P.C., no such fine is payable till the decision of the appeal. It issubmitted that therefore also the first appellate Court ought not to havepassed any order directing the appellants to deposit 25% of the amountGof fine/compensation, pending appeal/s. In support of his abovesubmission, learned Senior Counsel has heavily relied upon the decisionof this Court in the case of Dilip S. Dhanukar v. Kotak MahindraBank, reported in (2007) 6 SCC 528.

5.8 Making the above submissions and relying upon the aforesaidHdecisions, it is prayed to allow the present appeals and quash and set aside the impugned order passed by the first appellate court, confirmedby the High Court, by which the appellants are directed to deposit 25%of the amount of compensation considering Section 148 of the N.I. Actas amended.

6. While opposing the present appeals, Shri Alok Sangwan, learnedAdvocate appearing on behalf of the original complainant has vehementlysubmitted that the order passed by the first appellate Court directing theappellants to deposit 25% of the amount of compensation/fine pendingappeal and while suspending the sentence imposed by the learned trialCourt is absolutely in consonance with the Statement of Objects andReasons of the amendment in Section 148 of the N.I. Act. It is submittedthat having found that because of delay tactics of unscrupulous drawersof dishonoured cheques due to easy filing of appeals and obtaining stayon proceedings, the object and purpose of N.I. Act was being frustratedand having found that due to such delay tactics, injustice is caused to thepayee of a dishonoured cheque who has to spend considerable time andresources in court proceedings to realize the value of the cheque, theParliament thought it fit to amend Section 148 of the N.I. Act, whichconfers powers on the first appellate court to direct the appellant (theconvict for the offence under Section 138 of the N.I. Act) to depositsuch sum which shall be minimum of 20% of the fine or compensationawarded by the trial court. It is submitted that therefore the High Courthas rightly refused to interfere with the order passed by the first appellatecourt, which was just in consonance with the provisions of Section 148of the N.I. Act as amended.

6.1 It is further submitted by the learned Advocate appearing onbehalf of the original complainant that the submission on behalf of theappellants – original accused that Section 148 of the N.I. Act would notbe made applicable retrospectively and shall not be applicable to theappeals arising out of the criminal proceedings which were initiated muchprior to the amendment in Section 148 of the N.I. Act is concerned, it isvehemently submitted that the aforesaid submission has no substance.It is submitted that first of all amendment in Section 148 of the N.I. Actis procedural in nature and therefore there is no question of applying thesame retrospectively. It is submitted that as such no vested right of theappeal of the appellants has been taken away or affected by amendmentin Section 148 of the N.I. Act. It is submitted that in the present case,admittedly, the appeals were preferred after the amendment in Section A

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A148 of the N.I. Act came into force and therefore Section 148 of theN.I. Act, as amended, is rightly invoked/applied by the learned firstappellate Court. It is submitted that therefore the amendment so broughtin the Act by insertion of Section 148 of the N.I. Act is purely proceduralin nature and not substantive and does not affect the vested rights of theappellants, as such, the same can have a retrospective effect and can beBapplied in the present case also.

6.2 Now so far as the reliance placed on Section 357(2) of theCr.P.C. and the submission of the learned Senior Advocate appearing onbehalf of the appellants that in view of Section 357(2) of the Cr.P.C.,fine during the pendency of the appeal is not recoverable is concerned,Cit is vehemently submitted that in the present case in Section 148 of theN.I. Act as amended, it is specifically stated that “Notwithstandinganything contained in the Code of Criminal Procedure, 1973…..”. It issubmitted that therefore Section 148 of the N.I. Act as amended shallbe applicable and it is always open for the appellate court to direct depositDof such sum, but not less than 20% of the amount of compensation/fineimposed by the learned trial court.

6.3 Making the above submissions, it is prayed to dismiss thepresent appeals.

6.3 Making the above submissions, it is prayed to dismiss thepresent appeals.

7. We have heard the learned counsel for the respective partiesEat length.

7.1 The short question which is posed for consideration beforethis Court is, whether the first appellate court is justified in directing theappellants – original accused who have been convicted for the offenceunder Section 138 of the N.I. Act to deposit 25% of the amount ofFcompensation/fine imposed by the learned trial Court, pending appealschallenging the order of conviction and sentence and while suspendingthe sentence under Section 389 of the Cr.P.C., considering Section 148of the N.I. Act as amended?

7.2 While considering the aforesaid issue/question, the StatementGof Objects and Reasons of the amendment in Section 148 of the N.I.Act, as amended by way of Amendment Act No. 20/2018 and Section148 of the N.I. Act as amended, are required to be referred to andconsidered, which read as under:

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SURINDER SINGH DESWAL @ COL. S.S. DESWAL ANDOTHERS v. VIRENDER GANDHI [M. R. SHAH, J.]

“The Negotiable Instruments Act, 1881 (the Act) was enacted todefine and amend the law relating to Promissory Notes, Bills ofExchange and Cheques. The said Act has been amended fromtime to time so as to provide, inter alia, speedy disposal of casesrelating to the offence of dishonour of cheques. However, theCentral Government has been receiving several representationsfrom the public including trading community relating to pendencyof cheque dishonour cases. This is because of delay tactics ofunscrupulous drawers of dishonoured cheques due to easy filingof appeals and obtaining stay on proceedings. As a result of this,injustice is caused to the payee of a dishonoured cheque who hasto spend considerable time and resources in court proceedings torealize the value of the cheque. Such delays compromise thesanctity of cheque transactions.

2. It is proposed to amend the said Act with a view to address theissue of undue delay in final resolution of cheque dishonour casesso as to provide relief to payees of dishonoured cheques and todiscourage frivolous and unnecessary litigation which would savetime and money. The proposed amendments will strengthen thecredibility of cheques and help trade and commerce in general byallowing lending institutions, including banks, to continue to extendfinancing to the productive sectors of the economy.

3. It is, therefore, proposed to introduce the Negotiable Instruments(Amendment) Bill, 2017 to provide, inter alia, for the following,namely:—

(i) to insert a new section 143A in the said Act to provide that theCourt trying an offence under section 138, may order the drawerof the cheque to pay interim compensation to the complainant, ina summary trial or a summons case, where he pleads not guilty tothe accusation made in the complaint; and in any other case, uponframing of charge. The interim compensation so payable shall besuch sum not exceeding twenty per cent of the amount of thecheque; and

(ii) to insert a new section 148 in the said Act so as to provide thatin an appeal by the drawer against conviction under Section 138,the Appellate Court may order the appellant to deposit such sumwhich shall be a minimum of twenty per cent of the fine orcompensation awarded by the trial court.

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4. The Bill seeks to achieve the above objectives.”

‘‘148. Power to Appellate Court to order payment pendingappeal against conviction.... (1) Notwithstanding anythingcontained in the Code of Criminal Procedure, 1973 (2 of 1974), inan appeal by the drawer against conviction under section 138, theBAppellate Court may order the appellant to deposit such sum whichshall be a minimum of twenty per cent of the fine or compensationawarded by the trial Court:

Provided that the amount payable under this sub-sectionshall be in addition to any interim compensation paid by the appellantunder section 143A.

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(2) The amount referred to in sub-section (1) shall bedeposited within sixty days from the date of the order, or withinsuch further period not exceeding thirty days as may be directedby the Court on sufficient cause being shown by the appellant.

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(3) The Appellate Court may direct the release of the amountdeposited by the appellant to the complainant at any time duringthe pendency of the appeal:

Provided that if the appellant is acquitted, the Court shalldirect the complainant to repay to the appellant the amount soreleased, with interest at the bank rate as published by the ReserveBank of India, prevalent at the beginning of the relevant financialyear, within sixty days from the date of the order, or within suchfurther period not exceeding thirty days as may be directed by theCourt on sufficient cause being shown by the complainant.’’

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F8. It is the case on behalf of the appellants that as the criminalcomplaints against the appellants under Section 138 of the N.I. Act werelodged/filed before the amendment Act No. 20/2018 by which Section148 of the N.I. Act came to be amended and therefore amended Section148 of the N.I. Act shall not be made applicable. However, it is requiredto be noted that at the time when the appeals against the conviction ofGthe appellants for the offence under Section 138 of the N.I. Act werepreferred, Amendment Act No. 20/2018 amending Section 148 of theN.I. Act came into force w.e.f. 1.9.2018. Even, at the time when theappellants submitted application/s under Section 389 of the Cr.P.C. tosuspend the sentence pending appeals challenging the conviction andHsentence, amended Section 148 of the N.I. Act came into force and was brought on statute w.e.f. 1.9.2018. Therefore, considering the objectand purpose of amendment in Section 148 of the N.I. Act and whilesuspending the sentence in exercise of powers under Section 389 of theCr.P.C., when the first appellate court directed the appellants to deposit25% of the amount of fine/compensation as imposed by the learned trialCourt, the same can be said to be absolutely in consonance with theStatement of Objects and Reasons of amendment in Section 148 of theN.I. Act.

8.1 Having observed and found that because of the delay tacticsof unscrupulous drawers of dishonoured cheques due to easy filing ofappeals and obtaining stay on proceedings, the object and purpose of theenactment of Section 138 of the N.I. Act was being frustrated, theParliament has thought it fit to amend Section 148 of the N.I. Act, bywhich the first appellate Court, in an appeal challenging the order ofconviction under Section 138 of the N.I. Act, is conferred with the powerto direct the convicted accused – appellant to deposit such sum whichshall be a minimum of 20% of the fine or compensation awarded by thetrial Court. By the amendment in Section 148 of the N.I. Act, it cannotbe said that any vested right of appeal of the accused – appellant hasbeen taken away and/or affected. Therefore, submission on behalf ofthe appellants that amendment in Section 148 of the N.I. Act shall not bemade applicable retrospectively and more particularly with respect tocases/complaints filed prior to 1.9.2018 shall not be applicable has nosubstance and cannot be accepted, as by amendment in Section 148 ofthe N.I. Act, no substantive right of appeal has been taken away and/oraffected. Therefore the decisions of this Court in the cases ofGarikapatti Veeraya (supra) and Videocon International Limited(supra), relied upon by the learned senior counsel appearing on behalfof the appellants shall not be applicable to the facts of the case on hand.Therefore, considering the Statement of Objects and Reasons of theamendment in Section 148 of the N.I. Act stated hereinabove, onpurposive interpretation of Section 148 of the N.I. Act as amended, weare of the opinion that Section 148 of the N.I. Act as amended, shall beapplicable in respect of the appeals against the order of conviction andsentence for the offence under Section 138 of the N.I. Act, even in acase where the criminal complaints for the offence under Section 138 ofthe N.I. Act were filed prior to amendment Act No. 20/2018 i.e., prior to01.09.2018. If such a purposive interpretation is not adopted, in thatcase, the object and purpose of amendment in Section 148 of the N.I.

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AAct would be frustrated. Therefore, as such, no error has been committedby the learned first appellate court directing the appellants to deposit25% of the amount of fine/compensation as imposed by the learned trialCourt considering Section 148 of the N.I. Act, as amended.

9. Now so far as the submission on behalf of the appellants thatBeven considering the language used in Section 148 of the N.I. Act asamended, the appellate Court “may” order the appellant to deposit suchsum which shall be a minimum of 20% of the fine or compensationawarded by the trial Court and the word used is not “shall” and thereforethe discretion is vested with the first appellate court to direct the appellant– accused to deposit such sum and the appellate court has construed itCas mandatory, which according to the learned Senior Advocate for theappellants would be contrary to the provisions of Section 148 of the N.I.Act as amended is concerned, considering the amended Section 148 ofthe N.I. Act as a whole to be read with the Statement of Objects andReasons of the amending Section 148 of the N.I. Act, though it is trueDthat in amended Section 148 of the N.I. Act, the word used is “may”, itis generally to be construed as a “rule” or “shall” and not to direct todeposit by the appellate court is an exception for which special reasonsare to be assigned. Therefore amended Section 148 of the N.I. Actconfers power upon the Appellate Court to pass an order pending appealto direct the Appellant-Accused to deposit the sum which shall not beEless than 20% of the fine or compensation either on an application filedby the original complainant or even on the application filed by theAppellant-Accused under Section 389 of the Cr.P.C. to suspend thesentence. The aforesaid is required to be construed considering the factthat as per the amended Section 148 of the N.I. Act, a minimum of 20%Fof the fine or compensation awarded by the trial court is directed to bedeposited and that such amount is to be deposited within a period of 60days from the date of the order, or within such further period notexceeding 30 days as may be directed by the appellate court for sufficientcause shown by the appellant. Therefore, if amended Section 148 of the N.I. Act is purposively interpreted in such a manner it would serveGthe Objects and Reasons of not only amendment in Section 148 of theN.I. Act, but also Section 138 of the N.I. Act. Negotiable InstrumentsAct has been amended from time to time so as to provide, inter alia,speedy disposal of cases relating to the offence of the dishonoured ofcheques. So as to see that due to delay tactics by the unscrupulous H

drawers of the dishonoured cheques due to easy filing of the appealsand obtaining stay in the proceedings, an injustice was caused to thepayee of a dishonoured cheque who has to spend considerable time andresources in the court proceedings to realise the value of the cheque andhaving observed that such delay has compromised the sanctity of thecheque transactions, the Parliament has thought it fit to amend Section148 of the N.I. Act. Therefore, such a purposive interpretation wouldbe in furtherance of the Objects and Reasons of the amendment inSection 148 of the N.I. Act and also Sec 138 of the N.I. Act.

10. Now so far as the submission on behalf of the appellants,relying upon Section 357(2) of the Cr.P.C. that once the appeal againstthe order of conviction is preferred, fine is not recoverable pending appealand therefore such an order of deposit of 25% of the fine ought not tohave been passed and in support of the above reliance placed upon thedecision of this Court in the case of Dilip S. Dhanukar (supra) isconcerned, the aforesaid has no substance. The opening word ofamended Section 148 of the N.I. Act is that “notwithstanding anythingcontained in the Code of Criminal Procedure…..”. Therefore irrespectiveof the provisions of Section 357(2) of the Cr.P.C., pending appeal beforethe first appellate court, challenging the order of conviction and sentenceunder Section 138 of the N.I. Act, the appellate court is conferred withthe power to direct the appellant to deposit such sum pending appealwhich shall be a minimum of 20% of the fine or compensation awardedby the trial Court.

In view of the above and for the reasons stated herein above,impugned Judgment and Order passed by the High Court does not callfor any interference.

11. At this stage, learned Senior Advocate appearing on behalf ofthe appellants has requested to grant the appellants some more time(three months’ time) to deposit the amount as per the order passed bythe first appellate court, confirmed by the High Court. The said prayeris opposed by the learned Advocate appearing on behalf of the originalcomplainant. It is submitted that as per amended Section 148 of the N.I.Act, the appellants – accused have to deposit the amount of compensation/fine as directed by the appellate court within a period of 60 days whichcan be further extended by a further period of 30 days as may be directedby the Court on sufficient cause being shown by the appellants. However, AB

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Ain the facts and circumstances of the case and considering the fact thatthe appellants were bonafidely litigating before this Court challengingthe order passed by the first appellate court, in exercise of powers underArticle 142 of the Constitution of India and in the peculiar facts andcircumstances of the case and the amount to be deposited is a hugeamount, we grant further four weeks’ time from today to the appellantsBto deposit the amount as directed by the first appellate court, confirmedby the High Court and further confirmed by this Court.

12. In view of the above and for the reasons stated above, we seeno reason to interfere with the impugned common judgment and orderpassed by the High Court dismissing the revision application/s, confirmingCthe order passed by the first appellate court directing the appellants todeposit 25% of the amount of fine/compensation pending appeals.

The instant appeals are accordingly dismissed with the aforesaidobservations and appellants are now directed to deposit the amountdirected by the first appellate court within extended period of four weeksDfrom today.

Devika Gujral

Appeals dismissed.

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