IN RE: EXPEDITIOUS TRIAL OF CASES UNDER SECTION 138 OF N.I. ACT 1881 versus .
[2021] 4 S.C.R. 257, Supreme Court of India, 2021
Outcome: Directions issued
Segment: Issues
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   [2021] 4 S.C.R. 257
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IN RE: EXPEDITIOUS TRIAL OF CASES UNDER SECTION 138
OF N.I. ACT 1881.
(Suo Motu Writ Petition (Crl.) No. 2 of 2020)
APRIL 16, 2021
[S. A. BOBDE, CJI, L. NAGESWARA RAO, B. R. GAVAI,
A. S. BOPANNA, S. RAVINDRA BHAT, JJ.]
Negotiable Instruments Act, 1881: s. 138 – Expeditious trial/
disposal of cases u/s. 138 – Pendency of matters u/s. 138 at various
levels, having adverse effect in disposal of other criminal cases –
Imminent need for remedying the situation – Suo Motu Writ Petition
– Issuance of notice to Union of India, Registrar Generals of the
High Courts, Director Generals of Police of the States and Union
Territories, Member Secretary of the National Legal Services
Authority, Reserve Bank of India and Indian Banks’ Association –
Submission of preliminary report by amici curiae, based on the
responses by the State Government and Union Territories – In veiw
thereof, necessary suggestions made for redressal of backlog of
cases, by this Court – Request to High Courts to issue practice
directions to the Magistrates to record reasons before converting
trial of complaints u/s 138 from summary trial to summons trial –
Inquiry to be conducted on receipt of complaints u/s 138 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 u/s 202 of the Code, evidence of witnesses
on behalf of the complainant to be permitted to be
taken on affidavit,
and in suitable cases, the Magistrate can restrict the inquiry to
examination of documents without insisting for examination of
witnesses – Amendments be made to the Act for provision of one
trial against a person for multiple offences u/s 138 committed within
a period of 12 months, notwithstanding the restriction in s. 219 of
the Code – Request to High Courts to issue practice directions to
the trial courts to treat service of summons in one complaint u/s 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 – Amendment to the
Act empowering the trial courts to reconsider/recall summons in
respect of complaints u/s 138 to be considered by the Committee
constituted, alongwith the other issues relating to expeditious
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disposal of complaints u/s 138 – Code of Criminal Procedure, 1973
– ss. 202, 219, 258, 322.
Adalat Prasad v. Rooplal Jindal and Others (2004) 7
SCC 338; Subramanium Sethuraman v. State of
Maharashtra & Anr. (2004) 13 SCC 324 – relied on.
Meters and Instruments Private Limited and Another v.
Kanchan Mehta (2018) 1 SCC 560 : [2017] 10 SCR 66
– held not correct law.
Vijay Dhanuka & Ors. v. Najima Mamtaj & Ors. (2014)
14 SCC 638 : [2014] 4 SCR 171; Abhijit Pawar v.
Hemant Madhukar Nimbalkar and Anr. (2017) 3 SCC
528 : [2016] 9 SCR 475; Birla Corporation Limited v.
Adventz Investments and Holdings Limited & Ors.
(2019) 16 SCC 610 : [2019] 7 SCR 655; K.S. Joseph
v. Philips Carbon Black Ltd & Anr. (2016) 11 SCC
105 : [2016] 2 SCR 914; Balbir v. State of Haryana &
Anr. (2000) 1 SCC 285 : [1999] 4  Suppl.  SCR  120;
Vani Agro Enterprises v. State of Gujarat & Ors. 2019
(10) SCJ 238; State of Andhra Pradesh v. Cheemalapati
Ganeswara Rao & Anr. [1964] 3 SCR 297; K. M.
Mathew v. State of Kerala & Anr (1992) 1 SCC 217 :
[1991] 2 Suppl.  SCR  364; Union of India v. Deoki
Nandan Aggarwal 1992 Supp (1) SCC 323 : [1991] 3
SCR 873 – referred to.
Case Law Reference
[2014] 4 SCR 171
referred to
Para 10
[2016] 9 SCR 475
referred to
Para 10
[2019] 7 SCR 655  
referred to
Para 10
[2016] 2 SCR 914
referred to
Para 11
[1999] 4 Suppl. SCR 120
referred to
Para 13
2019 (10) SCJ 238
referred to
Para14
[1964] 3 SCR 297
referred to
Para 15
[1991] 2
Suppl.  SCR  364
referred to
Para 17
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[1991] 3 SCR 873
referred to
Para 20
(2004) 7 SCC 338
relied on
Para 24
(2004) 13 SCC 324
relied on
Para24
[2017] 10 SCR 66  
held not correct law
Para 24
CRIMINAL ORIGINAL JURISDICTION : Suo Motu Writ
Petition (Crl.) No.2 of 2020.
Suo Motu Proceeding Under Article 32 of The Constitution.
Tushar Mehta, Ld. SG., Vikramjit Banerjee, Ld. ASG., Neeraj,
Mrs. Garima Prashad, AAGs., Sidharth Luthra, Mrs. Garima Prashad,
Soumya Chakraborty, Sunil Kumar, P.H. Parekh, Thomas P. Joseph, Sr.
Adv., K. Parameshwar, M.V. Mukunda, Ms. A. Sregurupriya, Rajat
Mathur, Anmol Kheta, Sheezan Hashmi, Akshat Kumar, Mrs. Neela
Kedar Gokhle, P. V. Yogeshwaran, Divyansh H. Rathi, B. V. Balaram
Das, Raj Bahadur Yadav, Ms. Manisha Ambwani, G.S. Makker, Saumya
Sinha, Piyush Beriwal, Dr. Monika Gusain, Aviral Saxena, Vishwa Pal
Singh, Mahfooz A Nazki, Polanki Gowtham, Shaik Mohamad Haneef,
T. Vijaya Bhaskar Reddy, Amitabh Sinha, Shrey Sharma, Shubhranshu
Padhi, Ashish Yadav, Rakshit Jain, Vishal Banshal, Abhinav Agrawal,
Harpreet Singh Gupta, Manish Kumar, Gaurav Agrawal, Raghvendra
Kumar, Anand Kumar Dubey, Narendra Kumar, Anupam Raina, Sunando
Raha, Naresh K. Sharma, S. Udaya Kumar Sagar, Ms. Sweena Nair,
Abhimanyu Tewari, V.G. Pragasam, S. Prabhu Ramasubramanian, M.
Yogesh Kanna, Raja Rajeshwaran S, Aditya Chadha, Ms. Uma Prasuna
Bachu, Mrs. Jaspreet Gogia, Ms. Mandakini Singh, Karanvir Gogia, Ms.
Shivangi Singhal, Ms. Ashima Mandla, Yashvardhan, Apoorv Shukla,
Ms. Smita Kant, Ms.
Ishita Farsaiya, Ms. Prabhleen Kaur, Ms. Garima
Prashad, Avijit Mani Tripathi, T.K. Nayak, Pukhrambam Ramesh Kumar,
Ms. Anupama Ngangom, Karun Sharma, Sachin Patil, Rahul Chitnis,
Aaditya A. Pande, Geo Joseph, Jishnu M.L., Ms. Priyanka Prakash,
Ms. Beena Prakash, G. Prakash, Ms. Aruna Mathur, Avneesh Arputham,
For M/S. Arputham Aruna And Co, Shuvodeep Roy, Kumar Anurag
Singh, Anando Mukherjee, Ms. Tulika Mukherjee, Vinay Garg, Upendra
Mishra, Ashish Ranjan, Kunal Chatterji, Ms. Maitrayee Banerjee, Pravar
Veer Misra, Gopal Jha, Shreyash Bhardwaj, Romy Chacko, Shakthi
Chand Jaidwal, Ashwin Romy, Satish Pandey, Salim Ansari, Sameer
Parekh, R. Nedumaran, Sharan Thakur, Mahesh Thakur, Siddhartha
IN RE: EXPEDITIOUS TRIAL OF CASES UNDER SECTION 138
OF N.I. ACT 1881.
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Thakur, Ms. Vipasha Singh, Sanjai Kumar Pathak, Arvind Kumar Tripathi,
Ms. Shashi Pathak, Jamnesh Kumar, Himanshu Shekhar, Ms. Eliza Bar,
Pai Amit, Sameer Parekh, Kshatrashal Raj, Ms. Tanya Chaudhry, Ms.
Pratyusha Priyadarshini, Ms. Nitika Pandey for M/S Parekh & Co.,
Siddhesh Kotwal, Ms. Bansuri Swaraj, Divyansh Tiwari, Ms. Ana
Upadhyay, Ms. Manya Hasija, Nirnimesh Dube, V. N. Raghupathy, Ms.
Rachana Srivastava, Ms. Rachna Gandhi, Suhaan Mukerji, Vishal Prasad,
Nikhil Parikshith, Abhishek Manchanda, Sayandeep Pahari for M/S. PLR
Chambers And Co., Shree Pal Singh, Abhimanyu Jhamba, Ashish Jhamb,
Samir Ali Khan, Ms. Pragati Neekhra, Ms. Deepanwita Priyanka,
Aniruddha P. Mayee, Apoorv Kurup, Ms. Nidhi Mittal, Ms. Uttara
Babbar, Manan Bansal, Ms. Shweta Mohta, Sibo Sankar Mishra, V.K.
Biju, Amlendu Kumar Akhilesh Kumar Jha, Shaji George, Ms. Rubina
Jawed, Dr. Lalit Bhasin, Ms. Nina Gupta, Ms. Christi Jain, Ms. K. Enatoli
Sema, Amit Kumar Singh, Apratim Animesh Thakur, Ms. Prachi Hasija,
Arjun Garg, Ms. Shrutika Garg, Ms. Radhika Gautam, K. V. Jagdishvaran,
Ms. G. Indira, Ms. Taruna Ardhendumauli Prasad, Parth Awasthi, Dr.
Rajesh Pandey, Ms. Awasthi M.K., Ramesh Babu M. R., Ms. Manisha
Singh, Ms. Nisha Sharma, Dr. Abhishek Atrey, Shibashish Misra, Shree
Pal Singh, Advs. for the appearing Parties.
Applicant-in-person.
The following Order of the Court was passed:
ORDER
1. Special Leave Petition (Criminal) No. 5464 of 2016
pertains to
dishonour of two cheques on 27.01.2005 for an amount of Rs.1,70,000/
-. The dispute has remained pending for the past 16 years. Concerned
with the large number of cases filed under Section 138 of the Negotiable
Instruments Act, 1881 (hereinafter ‘the Act’) pending at various levels,
a Division Bench of this Court consisting of two of us (the Chief Justice
of India and L. Nageswara Rao, J.) decided to examine the reasons for
the delay in disposal of these cases. The Registry was directed to register
a Suo Motu Writ Petition (Criminal) captioned as “Expeditious Trial of
Cases under Section 138 of N.I. Act 1881”. Mr. Sidharth Luthra, learned
Senior Counsel was appointed as Amicus Curiae and Mr. K.
Parameshwar, learned Counsel was requested to assist him. Notices
were issued to the Union of India, Registrar Generals of the High Courts,
Director Generals of Police of the States and Union Territories, Member
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Secretary of the National Legal Services Authority, Reserve Bank of
India and Indian Banks’ Association, Mumbai as the representative of
banking institutions.
2. The learned Amici Curiae submitted a preliminary report on
11.10.2020 which was circulated to all the Respondents. On 19.01.2021,
the learned Amici Curiae informed this Court that only 14 out of 25 High
Courts had submitted their responses to the preliminary report.  The
Reserve Bank of India had also filed its suggestions.  Seven Directors
General of Police had filed their affidavits putting forward their views to
the preliminary report. The parties who had not filed their responses
were granted further time and the matter was listed on 24.02.2021 for
final disposal. During the course of the hearing, it was felt by a Bench of
three Judges, consisting of the Chief Justice of India, L. Nageswara
Rao, J. and S. Ravindra Bhat, J. that the matter had to be considered by
a larger bench in view of the important issues that arose for determination
before this Court. The reference of the matter to a larger bench was
also necessitated due to the submission made by the learned Amici Curiae
that certain judicial pronouncements of this Court needed clarification. 
We have heard learned Amici Curiae, Advocates for some States, the
learned Solicitor General of India, Mr. Vikramjit Banerjee, learned
Additional Solicitor General of India, Mr. Ramesh Babu, Advocate for
the Reserve Bank of India and Dr. Lalit
Bhasin, Advocate for the Indian
Banks’ Association.
3. Chapter XVII inserted in the Act, containing Sections 138 to
142, came into force on 01.04.1989. Dishonour of cheques for
insufficiency of funds was made punishable with imprisonment for a
term of one year or with fine which may extend to twice the amount of
the cheque as per Section 138. Section 139 dealt with the presumption in
favour of the holder that the cheque received was for the discharge, in
whole or in part, of any debt or other liability. The defence which may
not be allowed in a prosecution under Section 138 of the Act is governed
by Section 140. Section 141 pertains to offences by companies. Section
142 lays down conditions under which cognizance of offences may be
taken under Section 138. Over the years, courts were inundated with
complaints filed under Section 138 of the Act which could not be decided
within a reasonable period and remained pending for a number of years. 
4. This gargantuan pendency of complaints filed under Section
138 of the Act has had an adverse effect in disposal of other criminal
IN RE: EXPEDITIOUS TRIAL OF CASES UNDER SECTION 138
OF N.I. ACT 1881.
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cases.  There was an imminent need for remedying the situation which
was addressed by the Negotiable Instruments (Amendment and
Miscellaneous Provisions) Act, 2002. Sections 143 to 147 were inserted
in the Act, which came into force on 06.02.2003. Section 143 of the Act
empowers the court to try complaints filed under Section 138 of the Act
summarily, notwithstanding anything contained in the Code of Criminal
Procedure, 1973 (hereinafter, ‘the Code’). Sub-section (3) of Section
143 stipulates that an endeavour be made to conclude the trial within six
months from the date of filing of the complaint. Section 144 deals with
the mode of service of summons. Section 145 postulates that the evidence
of the complainant given by him on affidavit may be read as evidence in
any inquiry, trial or other proceeding under the Code. Bank’s slip or
memo denoting that the cheque has been dishonoured is presumed to be
prima facie evidence of the fact of dishonour of the cheque, according
to Section 146.  Section 147 makes offences punishable under the Act
compoundable. The punishment prescribed under the Act was enhanced
from one year to two years, along with other amendments made to
Sections 138 to 142 with which we are not concerned in this case.
5. The situation has not improved as courts continue to struggle
with the humongous pendency of complaints under Section 138 of the
Act. The preliminary report submitted by the learned Amici
Curiae shows
that as on 31.12.2019, the total number of criminal cases pending was
2.31 crores, out of which 35.16 lakh pertained to Section 138 of the Act.
The reasons for the backlog of cases, according to the learned Amici
Curiae, is that while there is a steady increase in the institution of
complaints every year, the rate of disposal does not match the rate of
institution of complaints. Delay in disposal of the complaints under Section
138 of the Act has been due to reasons which we shall deal with in this
order.
6. The learned Amici Curiae identified seven major issues from
the responses filed by the State Governments and Union Territories which
are as under:
a)
Service of summons
b)
Statutory amendment to Section 219 of the Code
c)
Summary trials
d)
Attachment of bank accounts
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e)
Applicability of Section 202 of the Code
f)
Mediation
g)
Inherent jurisdiction of the Magistrate
7. Service of summons on the accused in a complaint filed under
Section 138 of the Act has been one of the main reasons for the delay in
disposal of the complaints. After examining the responses of the various
State Governments and Union Territories, several suggestions have been
given by the learned Amici Curiae for speeding up the service of summons.
Some of the suggestions given by him pertain to dishonour slips issued
by the bank under Section 146 of the Act, disclosing the current mobile
number, email address and postal address of the drawer of the cheque,
the details of the drawer being given on the cheque leaf, creation of a
Nodal Agency for electronic service of summons and generation of a
unique number from the dishonour memo. The Union of India and the
Reserve Bank of India were directed to submit their responses to the
suggestions made by the learned Amici Curiae on these aspects. After
hearing the learned Solicitor General of India and Mr. Ramesh Babu,
learned counsel for the Reserve Bank of India, on 10.03.2021, it was
considered appropriate by this Court to form a Committee with Hon’ble
Mr. Justice R.C. Chavan, former Judge of the Bombay High Court, as
the Chairman to consider various suggestions that are made for arresting
the explosion of the judicial docket. The recommendations made by the
learned Amici Curiae relating to attachment of bank
accounts to the
extent of the cheque amount, pre-summons mediation and all other issues
which are part of the preliminary note and the written submissions of the
learned Amici Curiae shall be considered by the aforementioned
Committee, in addition to other related issues which may arise during
such consideration. The Committee is directed to deliberate on the need
for creation of additional courts to try complaints under Section 138 of
the Act.
MECHANICAL CONVERSION OF SUMMARY TRIAL
TO SUMMONS TRIAL
8. The learned Amici Curiae submitted that Section 143 of the
Act provides that Sections 262 to 265 of the Code shall apply for the trial
of all offences under Chapter XVII of the Act. The second proviso
empowers the Magistrate to convert the summary trial to summons trial,
if he is of the opinion that a sentence of imprisonment exceeding one
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OF N.I. ACT 1881.
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year may have to be passed or that it is undesirable to try the case
summarily, after recording reasons. The learned Amici Curiae has brought
to the notice of this Court that summary trials are routinely converted to
summons trials in a mechanical manner. The suggestions made by him
in his preliminary note that the High Courts should issue practice directions
to the Trial Courts for recording cogent and sufficient reasons before
converting a summary trial to summons trial have been accepted by the
High Courts.
9. Section 143 of the Act has been introduced in the year 2002 as
a step-in aid for quick disposal of complaints filed under Section 138 of
the Act.  At this stage, it is necessary to refer to Chapter XXI of the
Code which deals with summary trials. In a case tried summarily in
which the accused does not plead guilty, it is sufficient for the Magistrate
to record the substance of the evidence and deliver a judgment, containing
a brief statement of reasons for his findings. There is a restriction that
the procedure for summary trials under Section 262 is not to be applied
for any sentence of imprisonment exceeding three months. However,
Sections 262 to 265 of the Code were made applicable “as far as may
be” for trial of an offence under Chapter XVII of the Act, notwithstanding
anything contained in the Code.  It is only in a case where the Magistrate
is of the opinion that it may be necessary to sentence the
accused for a
term exceeding one year that the complaint shall be tried as a summons
trial.  From the responses of various High Courts, it is clear that the
conversion by the Trial Courts of complaints under Section 138
from summary trial to summons trial is being done mechanically without
reasons being recorded. The result of such conversion of complaints
under Section 138 from summary trial to summons trial has been
contributing to the delay in disposal of the cases. Further, the second
proviso to Section 143 mandates that the Magistrate has to record an
order spelling out the reasons for such conversion. The object of Section
143 of the Act is quick disposal of the complaints under Section 138 by
following the procedure prescribed for summary trial under the Code, to
the extent possible. The discretion conferred on the Magistrate by the
second proviso to Section 143 is to be exercised with due care and
caution, after recording reasons for converting the trial of the complaint
from summary trial to summons trial. Otherwise, the purpose for which
Section 143 of the Act has been introduced would be defeated.  We
accept the suggestions made by the learned Amici Curiae in consultation
with the High Courts. The High Courts may issue practice directions to
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the Magistrates to record reasons before converting trial of complaints
under Section 138 from summary trial to summons trial in exercise of
power under the second proviso to Section 143 of the Act.
INQUIRY UNDER SECTION 202 OF THE CODE IN
RELATION TO SECTION 145 OF THE ACT
10. Section 202 of the Code confers jurisdiction on the Magistrate
to conduct an inquiry for the purpose of deciding whether sufficient
grounds justifying the issue of process are made out. The amendment to
Section 202 of the Code with effect from 23.06.2006, vide Act 25 of
2005, made it mandatory for the Magistrate to conduct an inquiry before
issue of process, in a case where the accused resides beyond the area
of jurisdiction of the court. (See: Vijay Dhanuka & Ors. v. Najima
Mamtaj & Ors.1, Abhijit Pawar v. Hemant Madhukar Nimbalkar
and Anr.2and Birla Corporation Limited v. Adventz Investments and
Holdings Limited & Ors.3). There has been a divergence of opinion
amongst the High Courts relating to the applicability of Section 202 in
respect of complaints filed under Section 138 of the Act. Certain cases
under Section 138 have been decided by the High Courts upholding the
view that it is mandatory for the Magistrate to conduct an inquiry, as
provided in Section 202 of the Code, before issuance of process in
complaints filed under Section 138.  Contrary views have been expressed
in some other cases. It has been held that merely because the accused
is residing outside the jurisdiction
of the court, it is not necessary for the
Magistrate to postpone the issuance of process in each and every case.
Further, it has also been held that not conducting inquiry under Section
202 of the Code would not vitiate the issuance of process, if requisite
satisfaction can be obtained from materials available on record.
11. The learned Amici Curiae referred to a judgment of this Court
in K.S. Joseph v. Philips Carbon Black Ltd & Anr.4where there was
a discussion about the requirement of inquiry under Section 202 of the
Code in relation to complaints filed under Section 138 but the question of
law was left open. In view of the judgments of this Court in Vijay
Dhanuka (supra), Abhijit Pawar (supra)and Birla Corporation
(supra),the inquiry to be held by the Magistrate before issuance of
1 (2014) 14 SCC 638
2 (2017) 3 SCC 528
3 (2019) 16 SCC 610
4 (2016) 11 SCC 105
IN RE: EXPEDITIOUS TRIAL OF CASES UNDER SECTION 138
OF N.I. ACT 1881.
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summons to the accused residing outside the jurisdiction of the court
cannot be dispensed with. The learned Amici Curiae recommended that
the Magistrate should come to a conclusion after holding an inquiry that
there are sufficient grounds to proceed against the accused. We are in
agreement with the learned Amici.
12. Another point that has been brought to our notice relates to
the interpretation of Section 202 (2) which stipulates that the Magistrate
shall take evidence of the witness on oath in an inquiry conducted under
Section 202 (1) for the purpose of issuance of process. Section 145 of
the Act provides that the evidence of the complainant may be given by
him on affidavit, which shall be read in evidence in any inquiry, trial or
other proceeding, notwithstanding anything contained in the Code. Section
145 (2) of the Act enables the court to summon and examine any person
giving evidence on affidavit as to the facts contained therein, on an
application of the prosecution or the accused. It is contended by the
learned Amici Curiae that though there is no specific provision permitting
the examination of witnesses on affidavit, Section 145 permits the
complainant to be examined by way of an affidavit for the purpose of
inquiry under Section 202. He suggested that Section 202 (2) should be
read along with Section 145 and in respect of complaints under Section
138, the examination of witnesses also should be permitted
on affidavit.
Only in exceptional cases, the Magistrate may examine the witnesses
personally. Section 145 of the Act is an exception to Section 202 in
respect of examination of the complainant by way of an affidavit. There
is no specific provision in relation to examination of the witnesses also
on affidavit in Section 145. It becomes clear that Section 145 had been
inserted in the Act, with effect from the year 2003, with the laudable
object of speeding up trials in complaints filed under Section 138. If the
evidence of the complainant may be given by him on affidavit, there is
no reason for insisting on the evidence of the witnesses to be taken on
oath. On a holistic reading of Section 145 along with Section 202, we
hold that Section 202 (2) of the Code is inapplicable to complaints under
Section 138 in respect of examination of witnesses on oath. The evidence
of witnesses on behalf of the complainant shall be permitted on affidavit.
If the Magistrate holds an inquiry himself, it is not compulsory that he
should examine witnesses. In suitable cases, the Magistrate can examine
documents for satisfaction as to the sufficiency of grounds for proceeding
under Section 202.
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SECTIONS 219 AND 220 OF THE CODE
13. Section 219 of the Code provides that when a person is accused
of more offences than one, of the same kind, committed within a space
of 12 months, he may be tried at one trial for a maximum of three such
offences. If more than one offence is committed by the same person in
one series of acts so committed together as to form the same transaction,
he may be charged with and tried at one trial, according to Section 220.
In his preliminary report, the learned Amici Curiae suggested that a
legislative amendment is required to Section 219 of the Code to avoid
multiplicity of proceedings where cheques have been issued for one
purpose. In so far as Section 220 of the Code is concerned, the learned
Amici Curiae submitted that same/similar offences as part of the same
transaction in one series of acts may be the subject matter of one trial. It
was argued by the learned Amici Curiae that Section 220 (1) of the
Code is not controlled by Section 219 and even if the offences are more
than three in respect of the same transaction, there can be a joint trial.
Reliance was placed on a judgment of this Court in Balbir v. State of
Haryana & Anr.5 to contend that all offences alleged to have been
committed by the accused as a part of the same transaction can be tried
together in one trial, even if those offences may have been committed
as a part of a larger conspiracy.
14. The learned Amici Curiae pointed out that the judgment of
this
Court in Vani Agro Enterprises v. State of Gujarat & Ors.6 needs
clarification. In Vani Agro (supra), this Court was dealing with the
dishonour of four cheques which was the subject matter of four
complaints. The question raised therein related to the consolidation of all
the four cases. As only three cases can be tried together as per Section
219 of the Code, this Court directed the Trial Court to fix all the four
cases on one date. The course adopted by this Court in Vani Agro (supra)
is appropriate in view of the mandate of Section 219 of the Code. Hence,
there is no need for any clarification, especially in view of the submission
made by the learned Amici that Section 219 be amended suitably. We
find force in the submission of the learned Amici Curiae that one trial for
more than three offences of the same kind within the space of 12 months
in respect of complaints under Section 138 can only be by an amendment.
To reduce the burden on the docket of the criminal courts, we recommend
5 (2000) 1 SCC 285
6 2019 (10) SCJ 238
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OF N.I. ACT 1881.
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that a provision be made in the Act to the effect that a person can be
tried in one trial for offences of the same kind under Section 138 in the
space of 12 months, notwithstanding the restriction in Section 219 of the
Code.
15. Offences that are committed as part of the same transaction
can be tried jointly as per Section 220 of the Code. What is meant by
“same transaction” is not defined anywhere in the Code. Indeed, it would
always be difficult to define precisely what the expression means.
Whether a transaction can be regarded as the same would necessarily
depend upon the particular facts of each case and it seems to us to be a
difficult task to undertake a definition of that which the Legislature has
deliberately left undefined. We have not come across a single decision
of any court which has embarked upon the difficult task of defining the
expression. But it is generally thought that where there is proximity of
time or place or unity of purpose and design or continuity of action in
respect of a series of acts, it may be possible to infer that they form part
of the same transaction. It is, however, not necessary that every one of
these elements should co-exist for a transaction to be regarded as the
same. But if several acts committed by a person show a unity of purpose
or design that would be a strong circumstance to indicate that those acts
form part of the same transaction7. There is no ambiguity in Section
220
in accordance with which several cheques issued as a part of the same
transaction can be the subject matter of one trial.
16. The learned Amici Curiae have brought to our notice that
separate complaints are filed under Section 138 of the Act for dishonour
of cheques which are part of the same transaction. Undue delay in service
of summons is the main cause for the disproportionate accumulation of
complaints under Section 138 before the courts. The learned Amici
suggested that one way of reducing the time spent on service of summons
is to treat service of summons served in one complaint pertaining to a
transaction as deemed service for all complaints in relation to the said
transaction. We are in agreement with the suggestion made by the
learned Amici Curiae. Accordingly, the High Courts are requested to
issue practice directions to the Trial Courts to treat service of summons
in one complaint 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.
7 State of Andhra Pradesh v. Cheemalapati Ganeswara Rao & Anr., (1964) 3 SCR 297
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17. In K. M. Mathew v. State of Kerala & Anr.8, this Court dealt
with the power of the Magistrate under Chapter XX of the Code after
the accused enters appearance in response to the summons issued under
Section 204 of the Code. It was held that the accused can plead before
the Magistrate that the process against him ought not to have been issued
and the Magistrate may drop the proceedings if he is satisfied on
reconsideration of the complaint that there is no offence for which the
accused could be tried. This Court was of the opinion that there is no
requirement of a specific provision for the Magistrate to drop the
proceedings and as the order issuing the process is an interim order and
not a judgment, it can be varied or recalled. The observation in the case
of K. M. Mathew (supra) that no specific provision of law is required
for recalling an erroneous order of issue of process was held to be
contrary to the scheme of the Code in Adalat Prasad v. Rooplal Jindal
and Others9. It was observed therein that the order taking cognizance
can only be subject matter of a proceeding under Section 482 of the
Code as subordinate criminal courts have no inherent power. There is
also no power of review conferred on the Trial Courts by the Code. As
there is no specific provision for recalling an erroneous order by the
Trial Court, the judgment in the case of K. M. Mathew (supra) was held
to be not laying down correct law. The question
whether a person can
seek discharge in a summons case was considered by this Court in
Subramanium Sethuraman v. State of Maharashtra & Anr.10. The
law laid down in Adalat Prasad (supra) was reiterated.
18. It was contended by learned Amici Curiae that a holistic reading
of Sections 251 and 258 of the Code, along with Section 143 of the Act,
should be considered to confer a power of review or recall of the issuance
of process by the Trial Court in relation to complaints filed under Section
138 of the Act. He referred to a judgment of this Court in Meters and
Instruments Private Limited and Another v. Kanchan Mehta11 which
reads as follows:
“While it is true that in Subramanium Sethuraman v. State of
Maharashtra this Court observed that once the plea of the
8 (1992) 1 SCC 217
9 (2004) 7 SCC 338
10 (2004) 13 SCC 324
11 (2018) 1 SCC 560
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accused is recorded under Section 252 CrPC, the procedure
contemplated under Chapter XX CrPC has to be followed to
take the trial to its logical conclusion, the said judgment was
rendered as per statutory provisions prior to the 2002
Amendment. The statutory scheme post-2002 Amendment as
considered in  Mandvi Coop. Bank  and J.V. Baharuni has
brought about a change in law and it needs to be recognised.
After the 2002 Amendment, Section 143 of the Act confers
implied power on the Magistrate to discharge the accused if
the complainant is compensated to the satisfaction of the court,
where the accused tenders the cheque amount with interest
and reasonable cost of litigation as assessed by the court.
Such an interpretation was consistent with the intention of
legislature. The court has to balance the rights of the
complainant and the accused and also to enhance access to
justice. Basic object of the law is to enhance credibility of the
cheque transactions by providing speedy remedy to the
complainant without intending to punish the drawer of the
cheque whose conduct is reasonable or where compensation
to the complainant meets the ends of justice. Appropriate order
can be passed by the court in exercise of its inherent power
under Section 143 of the Act which is different from
compounding by consent of parties. Thus, Section 258 CrPC
which enables proceedings to be stopped in a summons case,
even though strictly speaking
is not applicable to complaint
cases, since the provisions of CrPC are applicable “so far as
may be”, the principle of the said provision is applicable to a
complaint case covered by Section 143 of the Act which
contemplates applicability of summary trial provisions, as far
as possible i.e. with such deviation as may be necessary for
speedy trial in the context.”
19. In Meters and Instruments (supra), this Court was of the
opinion that Section 143 of the Act confers implied power on the
Magistrate to discharge the accused, if the complainant is compensated
to the satisfaction of the court. On that analogy, it was held that apart
from compounding by the consent of the parties, the Trial Court has the
jurisdiction to pass appropriate orders under Section 143 in exercise of
its inherent power. Reliance was placed by this Court on Section 258 of
the Code to empower the Trial Courts to pass suitable orders.
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20. Section 143 of the Act mandates that the provisions of summary
trial of the Code shall apply “as far as may be” to trials of complaints
under Section 138. Section 258 of the Code empowers the Magistrate to
stop the proceedings at any stage for reasons to be recorded in writing
and pronounce a judgment of acquittal in any summons case instituted
otherwise than upon complaint. Section 258 of the Code is not applicable
to a summons case instituted on a complaint. Therefore, Section 258
cannot come into play in respect of the complaints filed under Section
138 of the Act. The judgment of this Court in Meters and Instruments
(supra) in so far as it conferred power on the Trial Court to discharge an
accused is not good law. Support taken from the words “as far as may
be” in Section 143 of the Act is inappropriate. The words “as far as may
be” in Section 143 are used only in respect of applicability of Sections
262 to 265 of the Code and the summary procedure to be followed for
trials under Chapter XVII. Conferring power on the court by reading
certain words into provisions is impermissible. A judge must not rewrite
a statute, neither to enlarge nor to contract it. Whatever temptations the
statesmanship of policy-making might wisely suggest, construction must
eschew interpolation and evisceration. He must not read in by way of
creation12. The Judge’s duty is to interpret and apply the law, not to
change it to meet the Judge’s idea of what justice requires13.
The court
cannot add words to a statute or read words into it which are not there14.
21. A close scrutiny of the judgments of this Court in Adalat
Prasad (supra) and Subramanium Sethuraman (supra) would show
that they do not warrant any reconsideration. The Trial Court cannot be
conferred with inherent power either to review or recall the order of
issuance of process. As held above, this Court, in its anxiety to cut down
delays in the disposal of complaints under Section 138, has applied Section
258 to hold that the Trial Court has the power to discharge the accused
even for reasons other than payment of compensation. However,
amendment to the Act empowering the Trial Court to reconsider/recall
summons may be considered on the recommendation of the Committee
constituted by this Court which shall look into this aspect as well.
22. Another submission made by the learned Amici Curiae relates
to the power of the Magistrate under Section 322 of the Code, to revisit
12 J. Frankfurter, “Of Law and Men: Papers and Addresses of Felix Frankfurter”.
13 Dupont Steels Ltd. v. Sirs (1980) 1 All ER 529 (HL)
14 Union of India v. Deoki Nandan Aggarwal 1992 Supp (1) SCC 323
IN RE: EXPEDITIOUS TRIAL OF CASES UNDER SECTION 138
OF N.I. ACT 1881.
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the order of issue of process if he has no jurisdiction to try the case. We
are in agreement with the learned Amici Curiae that in case the Trial
Court is informed that it lacks jurisdiction to issue process for complaints
under Section 138 of the Act, the proceedings shall be stayed and the
case shall be submitted to the Chief Judicial Magistrate or such other
Magistrate having jurisdiction.
23. Though we have referred all the other issues which are not
decided herein to the Committee appointed by this Court on 10.03.2021,
it is necessary to deal with the complaints under Section 138 pending in
Appellate Courts, High Courts and in this Court. We are informed by the
learned Amici Curiae that cases pending at the appellate stage and before
the High Courts and this Court can be settled through 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.
24. The upshot of the above discussion leads us to the following
conclusions:
1) 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.
2) 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.
3) 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 witnesses.
4) We 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.
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5) 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.
6) Judgments of this Court in Adalat Prasad (supra) and
Subramanium Sethuraman (supra) 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.
7) 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 (supra) 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 by
an order of this Court dated 10.03.2021.
8) All other points, which have been raised by the Amici Curiae in
their preliminary report and written submissions and not considered
herein, shall be the subject matter of deliberation by the
aforementioned Committee. Any other issue relating to expeditious
disposal of
complaints under Section 138 of the Act shall also be
considered by the Committee.
25. List the matter after eight weeks. Further hearing in this matter
will be before 3-Judges Bench.
26. We place on record our appreciation for the valuable assistance
rendered by Mr. Sidharth Luthra, learned Senior Counsel and Mr. K.
Parameshwar, learned Counsel, as Amici Curiae.
Nidhi Jain
Directions issued.
IN RE: EXPEDITIOUS TRIAL OF CASES UNDER SECTION 138
OF N.I. ACT 1881.