Supreme Court Suo Moto Registered Writ Petition To Evolve Mechanism For ‘Expeditious Trial Of Cheque Bounce Cases’[Read Order]

In a recent order, Supreme Court has Suo Moto registered a Writ Petition for evolving a coordinated mechanism for ‘Expeditious trial of Cheque Bounce cases.

The bench while considering a Special Leave Petition arising out of Cheque Dishonour case that was filed Fifteen Years ago remarked:

A matter which is supposed to be disposed of summarily by the trial court in six months, it took seven years for this case to be disposed of at the trial court level. A dispute of such nature has remained pending for 15 years in various courts, taking judicial time and space up till this Court.

The Supreme Court referred to various mandates Issued By the Court in Various Judgement For the speedy Disposal of cases and further remarked:

Service of Summons

Despite service of summons issued through aforesaid mediums, the problem of non-execution of further process persists. While summon may be issued through aforementioned modes, bailable warrants and non-bailable warrants are to be executed through police as per Section 72 of Cr.P.C. Many a time, police as serving agency, does not give heed to the process issued in private complaints. Courts also remain ambivalent of this fact, requiring the complainant to pay unjustified process fee, repeatedly and avoid to take action against negligent police officers. The coercive methods to secure the presence of accused viz. attachment indicated inSection 82 and 83 Cr.P.C., are seldom resorted. We find that there is a need to evolve a system of service/execution of process issued by the court and ensuring the presence of the accused, with the concerted efforts of all the stakeholders like Complainant, Police and Banks.

Further, a mechanism may be developed to ensure the presence of the accused even by way of coercive measure, if required, taking effect from Section 83 of Cr.P.C. which allows attachment of property, including movable property. A similar co-ordinated effort may be evolved to recover interim compensation under Section 143A of the N.I. Act as well as fine or compensation to be recovered as per Section 421 of Cr.P.C. The Bank may facilitate mechanism for transferring requisite funds from the bank account of the accused to the account of the holder in due course, as may be directed by the Court.

Responsibity of Banks

Banks, being an important stakeholders in cases of this nature, it is their responsibility to provide requisite details and facilitate an expeditious trial mandated by law. An information sharing mechanism may be developed where the banks share all the requisite details available of the accused, who is the account holder, with the complainant and the police for the purpose of execution of process. This may include a requirement to print relevant information, viz the email id, registered mobile number and permanent address of the account holder, on the cheque or dishonour memo informing the holder about the dishonour. The Reserve Bank of India, being the regulatory body may also evolve guidelines for banks to facilitate requisite information for the trial of these cases and such other matters as may be required. A separate software-based mechanism may be developed to track and ensure the service of process on the accused in cases relating to an offence under Section 138 of N.I. Act.

Pre-Litigation Settlement

With ever growing institution of N.I. cases, there is a need of developing a mechanism for pre-litigation settlement in these cases. The Legal Services Authorities Act, 1987provides for a statutory mechanism for disposal of case by Lok Adalat at pre-litigation stage under Sections 19 and 20of the Act. Further, Section 21 of the Act, recognises an award passed by Lok Adalats as a decree of a civil court and gives it a finality. The effect of above legal proposition is that an Award passed at the pre-litigation stage or pre-cognizance stage shall have an effect of a civil decree. The National Legal Services Authority, being the responsible Authority in this regard, may evolve a scheme for settlement of dispute relating to cheque bounce at pre-litigation i.e. before filing of the private complaint. This measure of pre-litigation ADR process can go a long way in settling the cases before they come to Court, thereby reducing docket burden.

The Bench Further held that

These are some indicative aspects in addition to what may come on board after hearing the relevant duty-holders. To work out mechanism for expeditious and just adjudication of cases relating to dishonour of cheques, fulfilling the mandate of law and reduce high pendency, various duty-holders like Banks, Police and Legal Services Authorities may be required to take measures and prepare schemes. Thus, we find it necessary to hear them for evolving a concerted, coordinated mechanism for expeditious adjudication of these cases as per the legal mandate.

Read Order Here: