Introduction: Fine Under NI Act
The Punjab and Haryana High Court has ruled that fines in cheque bounce cases under the Negotiable Instruments Act (NI Act) should be uniform. It stated that the fine must equal the cheque amount plus at least 6% interest per annum from the cheque date to the conviction judgment.
Case Background
A petitioner challenged orders by the Additional Sessions Judge and the Judicial Magistrate 1st Class, which convicted him under Section 138 of the NI Act. The petitioner was sentenced to two years of rigorous imprisonment and fined Rs. 10,000. The complainant had been deprived of Rs. 19 lakh since April 2015.
Petitioner’s Stance
The petitioner contested the fine’s inadequacy, arguing that the lower courts failed to properly consider the financial loss suffered by the complainant. The trial court imposed only a Rs. 10,000 fine and ordered two months of additional imprisonment for default but did not grant any compensation.
Court’s Ruling
Justice N.S. Shekhawat emphasized that fines should be consistent and compensatory. Before imposing fines, courts must account for any interim compensation under Section 143A of the NI Act or payments made during the trial. The judge noted that fines might or might not accompany imprisonment, at the trial court’s discretion, but imprisonment should be minimal unless the accused’s conduct warrants otherwise.
The Court referenced Bir Singh v. Mukesh Kumar, where the Supreme Court criticized magistrates for not prioritizing compensation in cheque bounce cases, causing hardships for complainants. It reiterated that courts should consider Section 357(3) of the Cr.P.C. and ensure fines adequately compensate the complainant.
Final Verdict
The High Court allowed the revision plea and remanded the case back to the trial court for fresh consideration of sentencing. The trial court must hear both parties again before imposing the sentence. The ruling ensures uniformity in fines while emphasizing the compensatory aspect of Section 138 cases.
