Whether magistrate can direct accused to pay interim compensation to complainant in cheque dishonour before he pleads not guilty to charge?

It was argued in sum that the stage for making such an order

would arise only when the accused is not guilty to the accusation

in the complaint.

As is evident from plain reading of Section 143A (1)(a), it is only where the accused “pleads not guilty” of the accusation made in the complaint that interim compensation under Section 143A (1) can be granted. In the present case, the Magistrate did not issue the order after the plea of the accused was entered, but before that i.e. after he answered the summons. The parties counsels were present at an intermediate stage of proceedings, but before the plea of “not gulity” was entered.

In these circumstances, clearly there is an infraction of

Section 143A (1). The order dated 24.05.2022 made by the Chief Judicial Magistrate, Gautam Budh Nagar, U.P. in Complaint No. 50/2021 cannot therefore be sustained and is hereby quashed.

 IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CRIMINAL APPEAL No. 1807 / 2023

PAWAN BHASIN Vs  STATE OF U.P. & ANR. 

Dated: 07TH JULY 2023.

Leave granted.

The question which appellant urges is regarding tenability of

the trial court’s order of 24.05.2022 whereby he was directed to

deposit 10% of the amount of a dishonored cheque under Section 143A

of the Negotiable Instruments Act, 1881. The appellant argues that

the order requiring such deposit was made by the Magistrate at a

stage prior to when notice under Section 251 was sent to the

accused petitioner.

The learned senior counsel Mr. Siddharth Dave relied upon the

text of Section 143 A which reads as follows:

“Section 143A: Power to direct interim

compensation.

143A. (1) Notwithstanding anything contained in the

Code of Criminal Procedure, 1973, the Court trying an

offence under section 138 may order the drawer of the

cheque to pay interim compensation to the complainant—

(a) in a summary trial or a summons case, where he

pleads not guilty to the accusation made in the

complaint; and

(b) in any other case, upon framing of charge.

(2) The interim compensation under sub-section (1)

shall not exceed twenty per cent. of the amount of the

cheque.

1

(3) The interim compensation shall be paid within sixty

days from the date of the order under sub-section (1),

or within such further period not exceeding thirty days

as may be directed by the Court on sufficient cause

being shown by the drawer of the cheque.

(4) If the drawer of the cheque is acquitted, the Court

shall direct the complainant to repay to the drawer the

amount of interim compensation, with interest at the

bank rate as published by the Reserve Bank of India,

prevalent at the beginning of the relevant financial

year, within sixty days from the date of the order, or

within such further period not exceeding thirty days as

may be directed by the Court on sufficient cause being

shown by the complainant.

(5) The interim compensation payable under this section

may be recovered as if it were a fine under section 421

of the Code of Criminal Procedure, 1973 (2 of 1974).

(6) The amount of fine imposed under section 138 or the

amount of compensation awarded under section 357 of the

Code of Criminal Procedure, 1973 (2 of 1974), shall be

reduced by the amount paid or recovered as interim

compensation under this section.”

It was argued in sum that the stage for making such an order

would arise only when the accused is not guilty to the accusation

in the complaint.

Mr. Devashish Bharuka, learned counsel appearing on behalf

of the respondent supported the orders of the court below and

further stated that the trial has proceeded to its final stage, as

the complainant’s evidence as well as the appellant’s/accused

statements have been recorded. In these circumstances, there would

be no prejudice caused to the appellant.

As is evident from plain reading of Section 143A (1)(a), it is

only where the accused “pleads not guilty” of the accusation made

in the complaint that interim compensation under Section 143A (1)

can be granted. In the present case, the Magistrate did not issue

the order after the plea of the accused was entered, but before

that i.e. after he answered the summons. The parties counsels were

present at an intermediate stage of proceedings, but before the

plea of “not gulity” was entered.

In these circumstances, clearly there is an infraction of

Section 143A (1).

The order dated 24.05.2022 made by the Chief Judicial

Magistrate, Gautam Budh Nagar, U.P. in Complaint No. 50/2021 cannot

therefore be sustained and is hereby quashed.

Since the trial has proceeded and is at an advanced stage, no

further orders are made except to observe that it is open at this

stage too for the complainant to seek appropriate relief, including

under Section 143A, since it can be claimed at “any stage”.

The appeal is allowed to the above extent.

Pending applications, if any, are disposed of.

………………………………………………J.

(S. RAVINDRA BHAT)

………………………………………………J.

(ARAVIND KUMAR)

NEW DELHI;

07TH JULY 2023

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