Disputed Signature and Account Ownership Leads Court to Revoke Lower Court's Compensation Order
In a significant judgment, the Gauhati High Court has set aside an order directing the payment of interim compensation in a cheque bounce case involving a disputed signature and account ownership. The case, titled Sri. Madhu Ram Deka v. State of Assam, revolved around allegations under Section 138 of the Negotiable Instruments Act, 1881, concerning a cheque of Rs. 20,00,000 issued by the petitioner, Madhu Ram Deka. The court, presided over by Mr. Pranjal Das, found substantial grounds for contesting the authenticity of the cheque and its purported issuance, warranting a thorough adjudication through evidence rather than immediate interim relief.
The petitioner, Madhu Ram Deka, challenged the order issued by the Additional Chief Judicial Magistrate, Nalbari, which had directed him to pay 20% of the cheque amount as interim compensation under Section 143A of the NI Act. The petitioner argued that he neither issued the cheque nor signed it, further contending that he did not hold an account at the concerned branch of South Indian Bank. Supporting these claims, the Branch Manager of the bank testified that the account linked to the cheque belonged to another individual, Bhaswati Das, not the petitioner.
The defense highlighted a lodged complaint against alleged forgery, registered as Hatigaon Police Case No. 530 of 2021 under sections 420, 468, and 471 of the IPC, which underscored the disputes surrounding the cheque's authenticity. Given these circumstances, the High Court determined that the interim compensation was not prudent, emphasizing the need for a detailed examination of the case's merits and evidence.
Relying on precedents such as Rakesh Ranjan Shrivastava v. State of Jharkhand and Jugesh Sehgal v. Shamsher Singh Gogi, the High Court reiterated that interim compensation under Section 143A is discretionary and not mandatory, requiring a prima facie evaluation of both the complainant's claims and the accused's defense. The judgment underscored that if the accused's defense appears plausible, interim compensation may be denied.
The judgment marks a pivotal step in ensuring that interim compensation under the NI Act is awarded only after careful consideration of the case's complexities, preserving the integrity of judicial discretion. The court also directed expedited trial proceedings given the case's pendency since 2021.
Bottom Line:
Section 143A of the Negotiable Instruments Act, 1881 is discretionary, not mandatory, and the court must evaluate the merits of the case before granting interim compensation.
Statutory provision(s): Negotiable Instruments Act, 1881 Section 143A, Negotiable Instruments Act, 1881 Section 138, Criminal Procedure Code, 1973 (Revisional jurisdiction)
Sri. Madhu Ram Deka v. State of Assam, (Gauhati) : Law Finder Doc id # 2842822
