M/S White Horse Network Services Pvt Ltd and Anr v. State of Haryana and Another

114o INoTHEoHIGHoCOURToOFoPUNJABoANDoHARYANAoATo CHANDIGARHo oCRM-M-60897-2022o(O&M)oo DateoofoDecision:o04.01.2023o o o M/SoWHITEoHORSEoNETWORKoSERVICESoPVT.LTD.,o &oANR.o o o o o o o o o o o o …Petitionerso o Versuso STATEoOFoHARYANAo&oANR.o o o o o o o o o o o …Respondentso o CORAM:oo HON'BLEoMR.oJUSTICEoHARSHoBUNGERo Presento:o Mr.oManmohanoSaroop,oAdvocateo o o foroMr.oD.V.oDhindsa,oAdvocateo o o forotheopetitioners.o o HARSHoBUNGER,oJ.oo o TheopresentopetitionounderoSectiono482oofotheoCr.P.C.,ohasobeeno filedo byo theo petitionerso seekingo quashingo ofo ordero datedo 02.12.2022o (Annexureo P-4)o passedo byo theo learnedo Sessionso Judge,o Panchkulao ino CRA/138/2022otitledoasoM/soWhiteoHorseoNetworkoServicesoPvt.oLtd.oVso StateoofoHaryanaoandoanother,owhereby,otheopetitionero(appellant-convict)o hasobeenodirectedotoodeposito25%oofotheocompensationoamountoawardedobyo theotrialoCourtoinotermsoofoprovisionsocontainedounderoSectiono148oofotheo NegotiableoInstrumentsoAct,o1881o(foroshorto`N.IoAct,o1881')o(asoamendedo up-to-date).o o o TheobriefofactsoofotheocaseoareothatoinoOctober,o2017,orespondento No.2-complainanto (M/so YPTo Entertainmento Houseo Pvt.o Ltd.)o filedo ao complaintounderoSectiono138oofotheoN.IoAct,o1881,ostatingothereinothatotheo complainantocompanyoisoengagedoinotheobusinessoofobroadcastingoofoGeneralo EntertainmentoChannel/Non-newsoandocurrentoaffairsoandohadoenteredointooano agreemento datedo 27.06.2015o witho petitionero No.1-Company,o ofo whicho petitionero No.2-Mr.o Panchapakesano Kailasamo ando oneo Mrs.o Mythilio Kailasam,owereotheiroDirectorsoandowereoliable/responsibleoforotheoconductoofo theoaffairsoofopetitioneroNo.1-Company.oAsoperotheoabovesaidoagreement,otheo contentoofopetitioneroNo.1-Companyowasotoobeobroadcastedoonotheotelevisiono channeloofotheocomplainant-Companyoi.e.oKalkioTVoonoanoexclusiveobasisoforo aoperiodoofothreeoyearsoagainstomonthlyosubscriptionoofoRs.8,65,000/-opluso thtaxes,owhichowasotoobeopaidobyo10 oofoeveryomonth.oItowasoclaimedoinotheo complaintothatodespiteoavailingotheoservicesoofotheocomplainant-Company,o theocorrespondingopaymentsowereonotomade,oresultantly,otheocomplainant-Companyodisconnectedotheoservicesoofotheopetitioners/accused.oItowasofurthero statedo thato ino partialo dischargeo ofo itso liability,o petitionero No.1-Companyo issuedo ao chequeo bearingo No.001420o datedo 09.05.2017o too theo tuneo ofo Rs.50,00,000/-oinofavouroofotheocomplainant-Companyoandotheosaidochequeo wasosignedobyopetitioneroNo.2-Mr.oPanchapakesanoKailasam,obeingoDirectoro ofopetitioneroNo.1-Company.oInotheocomplaint,oitowasoclaimedothatoasoono

09.05.2017,oaosumoofoRs.80,53,641/-owasodueotootheocomplainantoCompany.o However,ouponopresentationoofotheoaforesaidocheque,otheosameowasoreturnedo forotheoreasonoofoaccountoclosed.oAolegalodemandonoticeodatedo30.07.2017o wasoissuedouponotheopetitioners-accusedodemandingopaymentsoandothereafter,o theocomplaintounderoSectiono138oofotheoN.IoAct,o1881owasofiled.oo o o TheoproceedingsoofotheoaforesaidocomplaintounderoSectiono138o ofo theo N.Io Act,o 1881,o ultimatelyo resultedo intoo passingo ao judgmento ofo convictiono ando ordero ofo sentenceo datedo 04.11.2022o ando 09.11.2022,o respectively,o byo theo Judicialo Magistrateo Isto Class,o Panchkula,o whereby,o petitionero No.2-Panchapakesano Kailasmo (Directoro ofo M/so Whiteo Horseo Networko Services)o waso sentencedo too undergoo simpleo imprisonmento foro ao periodoofotwooyearsoforotheocommissionoofooffenceopunishableounderoSectiono 138oofotheoN.IoAct,o1881oandotheoperiodoofodetentionoalreadyoundergoneobyo himowasoorderedotoobeosetooffoagainstotheosubstantiveosentenceopassedobyotheo Court.oHowever,oinopursuanceoofoSectiono357(3)oCr.P.C.,opetitioneroNo.2owaso directedo too payo compensationo ofo 1.5o timeso ofo theo chequeo amounto i.e.o Rs.50,00,000/-oandoheowasoalsooorderedotoopayotheoamountoofocompensationo tootheocomplainantowithinoaoperiodoofotwoomonthsoofopassingoofotheoorderoando ifoheodoesonotomakeotheopaymentoofocompensation,othenotheocomplainantowaso grantedolibertyotoomoveoappropriateoapplicationofororealizationoofotheoamounto ofo compensation.o However,o ino defaulto ofo paymento ofo compensation,o theo convictowasofurtherodirectedotooundergoosimpleoimprisonmentoforoaoperiodoofo twoomonthsoandonoofineowasoimposedouponohim.o o o Aggrievedobyotheoaforesaidojudgmentoofoconvictionoandoorderoofo sentenceo datedo 04.11.2022o ando 09.11.2022,o respectively,o theo petitionerso preferredoanoappealobearingoNo.CRA/138/2022obeforeotheolearnedoSessionso Judge,o Panchkula,o whicho cameo upo foro considerationo ono 02.12.2022,o whereupononoticeowasoissuedoandotheotrialoCourtorecordowasoorderedotoobeo requisitioned.oTheoapplicationoforobailobyosuspendingotheoimpugnedosentenceo waso alsoo consideredo ono theo saido dateo ando theo learnedo Sessionso Judge,o Panchkula,oadmittedopetitioneroNo.2otoobailoonofurnishingobailobondsoinotheo sumoofoRs.1,00,000/-owithooneosuretyoofolikeoamountotootheosatisfactionoofotheo saidoCourtotillopendencyoofotheoappealoandoinotheomeantime,otheosentenceowaso orderedotooremainosuspended.oFurther,oinoviewoofoSectiono148oofotheoN.IoAct,o 1881,otheolearnedoSessionsoJudge,oPanchkula,ovideoorderodatedo02.12.2022,o directedotheopetitionersotoodeposito25%oofotheototalocompensationoamountoi.e.o Rs.18,75,000/-obeforeotheosaidoCourtoeitherobyowayoofoBankoDemandoDraftooro byo wayo ofo banko guaranteeo ino favouro ofo respondento No.2-complainant/Companyoonoorobeforeotheodateofixedoi.e.o09.01.2023,ofailingo which,oitowasoorderedothatotheobailoshallobeoliableotoobeocancelled.o o o Theoinstantopetitionohasobeenofiledochallengingotheosaidoordero datedo 02.12.2022o (Annexureo P-4)o passedo byo theo learnedo Sessionso Judge,o Panchkula.o o o Learnedo counselo foro theo petitionerso haso submittedo thato theo impugnedoorderoquaodepositoofo25%oofotheocompensationoamountoawardedobyo theoAppellate/SessionsoCourtohasobeenoorderedotoobeodepositedowithino38o dayso fromo theo dateo ofo passingo ofo theo order,o whicho iso wrong,o illegalo ando againsto theo provisionso ofo Sectiono 148o ofo theo N.Io Act,o 1881.o Ito iso furthero submittedothatotheoAppellateoCourtowhileograntingobailounderoSectiono389oofo theoCodeoofoCriminaloProcedureocannotomakeoitosubjectotoocomplianceoofo directiono too deposito ao parto ofo compensationo amounto awardedo byo theo trialo Court,oasoprovidedounderooSectiono148oofotheoN.IoAct,o1881.oItoisofurthero submittedothatotheodirectionsotoomakeoaodepositoinotermsoofoSectiono148oofotheo N.IoAct,o1881,oshouldonotobeobeyondo20%oofotheocompensationoorofine.oItoiso accordinglyoprayedothatotheoimpugnedoorderomayobeoquashedotootheoextento wherebyo theo petitionerso haveo beeno directedo too deposito 25%o ofo theo compensationoamountoawardedobyotheotrialoCourt.o o o Io haveo heardo learnedo counselo foro theo petitionerso ando haveo perusedo theo papero booko aso wello aso impugnedo ordero datedo 02.12.2022o (AnnexureoP-4)opassedobyotheolearnedoSessionsoJudge,oPanchkula.o o o o Sectiono148oofotheoN.I.oAct,o1881oreadsoasoundero:-o o [148.o Powero ofo Appellateo Courto too ordero paymento pendingo appealo againsto conviction.-(1)o Notwithstandingo anythingocontainedoinotheoCodeoofoCriminaloProcedure,o1973o (2oofo1974),oinoanoappealobyotheodraweroagainstoconvictiono undero sectiono 138,o theo Appellateo Courto mayo ordero theo appellantotoodepositosuchosumowhichoshallobeoaominimumoofo twentyoperocent.oofotheofineoorocompensationoawardedobyotheo trialoCourt:o o Providedothatotheoamountopayableounderothisosub-sectiono shallobeoinoadditionotooanyointerimocompensationopaidobyotheo appellantounderosectiono143A.o o (2)o Theo amountoreferredotooino sub-sectiono (1)oshallobeo depositedo withino sixtyo dayso fromo theo dateo ofo theo order,o oro withinosuchofurtheroperiodonotoexceedingothirtyodaysoasomayo beodirectedobyotheoCourtoonosufficientocauseobeingoshownobyo theoappellant.o o (3)o Theo Appellateo Courto mayo directo theo releaseo ofo theo amountodepositedobyotheoappellantotootheocomplainantoatoanyo timeoduringotheopendencyoofotheoappeal:o o Providedo thato ifo theo appellanto iso acquitted,o theo Courto shallo directo theo complainanto too repayo too theo appellanto theo amounto soo released,o witho interesto ato theo banko rateo aso publishedo byo theo Reserveo Banko ofo India,o prevalento ato theo beginningo ofo theo relevanto financialo year,o withino sixtyo dayso fromotheodateoofotheoorder,oorowithinosuchofurtheroperiodonoto exceedingo thirtyodayso aso mayo beo directedo byo theoCourtoono sufficientocauseobeingoshownobyotheocomplainant.]o o o Theoaforesaidoprovisionohasobeenoconsideredoandosettledobyoano authoritativeojudgmentopassedobyoHon'bleotheoApexoCourtoinoSurinderoSingho Deswalo@oCol.oS.S.oDeswaloov.ooVirenderoGandhioAIRo2019oSupremeoCourtoo o o 2345,otheorele(antoparagraphonos.8,o=oando 0oareoquotedobelo'oC$o "8. It is the case on behalf of the appellants that as the criminal complaints against the appellants under Section 138 of the N.I. Act were lodged/filed before the amendment Act No. 20/2018 by which Section 148 of the N.I. Act came to be amended and therefore amended Section 148 of the N.I. Act shall not be made applicable. However, it is required to be noted that at the time when the appeals against the conviction of the appellants for the offence under Section 138 of the N.I. Act were preferred, Amendment Act No. 20/2018 amending Section 148 of the N.I. Act came into force w.e.f. 1.9.2018. Even, at the time when the appellants submitted application/s under Section 389 of the Cr.P.C. to suspend the sentence pending appeals challenging the conviction and sentence, amended Section 148 of the N.I. Act came into force and was brought on statute w.e.f. 1.9.2018. Therefore, considering the object and purpose of amendment in Section 148 of the N.I. Act and while suspending the sentence in exercise of powers under Section 389 of the Cr.P.C., when the first appellate court directed the appellants to deposit 25% of the amount of fine/compensation as imposed by the learned trial Court, the same can be said to be absolutely in consonance with the Statement of Objects and Reasons of amendment in Section 148 of the N.I. Act.

8.1 Having observed and found that because of the delay tactics of unscrupulous drawers of dishonoured cheques due to easy filing of appeals and obtaining stay on proceedings, the object and purpose of the enactment of Section 138 of the N.I. Act was being frustrated, the Parliament has thought it fit to amend Section 148 of the N.I. Act, by which the first appellate Court, in an appeal challenging the order of conviction under Section 138 of the N.I. Act, is conferred with the power to direct the convicted accused - appellant to deposit such sum which shall be a minimum of 20% of the fine or compensation awarded by the trial Court. By the amendment in Section 148 of GURPREET KAUR the N.I. Act, it cannot be said that any vested right of appeal of

the accused - appellant has been taken away and/or affected. Therefore, submission on behalf of the appellants that amendment in Section 148 of the N.I. Act shall not be made applicable retrospectively and more particularly with respect to cases/complaints filed prior to 1.9.2018 shall not be applicable has no substance and cannot be accepted, as by amendment in Section 148 of the N.I. Act, no substantive right of appeal has been taken away and/or affected.. Therefore the decisions of this Court in the cases of Garikapatti Veeraya (supra) and Videocon International Limited (supra), relied upon by the learned senior counsel appearing on behalf of the appellants shall not be applicable to the facts of the case on hand. Therefore, considering the Statement of Objects and Reasons of the amendment in Section 148 of the N.I. Act stated hereinabove, on purposive interpretation of Section 148 of the N.I. Act as amended, we are of the opinion that Section 148 of the N.I. Act as amended, shall be applicable in respect of the appeals against the order of conviction and sentence for the offence under Section 138 of the N.I. Act, even in a case where the criminal complaints for the offence under Section 138 of the N.I. Act were filed prior to amendment Act No. 20/2018 i.e., prior to 01.09.2018. If such a purposive interpretation is not adopted, in that case, the object and purpose of amendment in Section 148 of the N.I. Act would be frustrated. Therefore, as such, no error has been committed by the learned first appellate court directing the appellants to deposit 25% of the amount of fine/compensation as imposed by the learned trial Court considering Section 148 of the N.I. Act, as amended.

¶9Now so far as the submission on behalf of the appellants that even considering the language used in Section 148 of the N.I. Act as amended, the appellate Court "may" order the appellant to deposit such sum which shall be a minimum of 20% of the fine or compensation awarded by the trial Court and the word used is not "shall" and therefore the discretion is vested with the first appellate court to direct the appellant - accused to deposit

such sum and the appellate court has construed it as mandatory, which according to the learned Senior Advocate for the appellants would be contrary to the provisions of Section 148 of the N.I. Act as amended is concerned, considering the amended Section 148 of the N.I. Act as a whole to be read with the Statement of Objects and Reasons of the amending Section 148 of the N.I. Act, though it is true that in amended Section 148 of the N.I. Act, the word used is "may", it is generally to be construed as a "rule" or "shall" and not to direct to deposit by the appellate court is an exception for which special reasons are to be assigned. Therefore amended Section 148 of the N.I. Act confers power upon the Appellate Court to pass an order pending appeal to direct the Appellant Accused to deposit the sum which shall not be less than 20% of the fine or compensation either on an application filed by the original complainant or even on the application filed by the Appellant Accused under Section 389 of the Cr.P.C. to suspend the sentence. The aforesaid is required to be construed considering the fact that as per the amended Section 148 of the N.I. Act, a minimum of 20% of the fine or compensation awarded by the trial court is directed to be deposited and that such amount is to be deposited within a period of 60 days from the date of the order, or within such further period not exceeding 30 days as may be directed by the appellate court for sufficient cause shown by the appellant. Therefore, if amended Section 148 of the N.I. Act is purposively interpreted in such a manner it would serve the Objects and Reasons of not only amendment in Section 148 of the N.I. Act, but also Section 138 of the N.I. Act. Negotiable Instruments Act has been amended from time to time so as to provide, inter alia, speedy disposal of cases relating to the offence of the dishonoured of cheques. So as to see that due to delay tactics by the unscrupulous drawers of the dishonoured cheques due to easy filing of the appeals and obtaining stay in the proceedings, an injustice was caused to the payee of a dishonoured cheque who has to spend considerable time and resources in the court proceedings to realise the value of the cheque and having observed that such delay has compromised the sanctity of the cheque transactions, the Parliament has thought it fit to amend Section 148 of the N.I. Act. Therefore, such a purposive interpretation would be in furtherance of the Objects and Reasons of the amendment in Section 148 of the N.I. Act and also Sec 138 of the N.I. Act.

¶10Now so far as the submission on behalf of the appellants, relying upon Section 357(2) of the Cr.P.C. that once the appeal against the order of conviction is preferred, fine is not recoverable pending appeal and therefore such an order of deposit of 25% of the fine ought not to have been passed and in support of the above reliance placed upon the decision of this Court in the case of Dilip S. Dhanukar (supra) is concerned, the aforesaid has no substance. The opening word of amended Section 148 of the N.I. Act is that "notwithstanding anything contained in the Code of Criminal Procedure.....". Therefore irrespective of the provisions of Section 357(2) of the Cr.P.C., pending appeal before the first appellate court, challenging the order of conviction and sentence under Section 138 of the N.I. Act, the appellate court is conferred with the power to direct the appellant to deposit such sum pending appeal which shall be a minimum of 20% of the fine or compensation awarded by the trial Court."o o o Aro+operusaloofotheoabo(eoreferredo>udg+entoinoS-ri#deroSi#/ho 0esw (&socaseo!su%ra%,oitoisoobser(edothatotheoapplicabilityoofotheopro(isiono underoSectiono 48oofotheo,.-o"ct,o 88 oiso+andatory.oAurther,oSectiono 48oofo theo,.-.o"ct,o 88 oen(isagesodepositoofo+ini+u+o20*oa+ountoandoSectiono 48oofotheo,.-.o"ct,o 88 ostartso'ithoaononoobstanteoclause.o o o <ecently,o ao Co$ordinateo Bencho ofo thiso Courto ino H rwi#dero Si#/hoooovsoooooMoh #ooL (ooo2022617ooR.C.R.oo6Cri.i# (7o135,ooofra+edootheoo o followingoquestiono:-o o o 7.oxxxoo o xxxo Q.o Whethero whileo suspendingo theo sentenceo ofo theo applicant/convict,o theo Appellateo Courto ino ano appealo againsto convictiono undero sectiono 138o ofo theo N.I.o Act,o cano imposeo ao conditionothatoononon-depositoofominimumoofotwentyopercentoofo theofine/compensationoawardedobyotheotrialocourt,oasoorderedo byo theo Appellateo courto whileo exercisingo itso powerso undero sectiono148oofotheoNIoAct,otheobenefitoofosuspensionoofosentenceo wouldobeoliableotoobeoautomatically/consequentlyovacated?o o o o AfterodiscussingotheolawoonoSectiono148oofotheoN.I.oAct,o1881,oito wasoheldoinoparaoNo.19oofoHarwinderoSingh'socaseo(supra)oasoundero:-o o o "19.o Thato theo Appellateo Courto ino ano appealo againstoconvictionounderoSectiono138oofotheoN.IoAct,owhileo suspendingotheosentenceoofotheoAppellant/Convict,ohasotheo powero too imposeo aoconditiono thato ono non-deposito ofo theo fine/compensation,o theo benefito ofo suspensiono ofo sentenceo wouldo beo liableo too beo automatically/consequentlyo vacated."o o o Ino viewo ofo theo aforesaido discussion,o thereo iso noo forceo ino theo submissionsoofolearnedocounseloforotheopetitionersothatotheoAppellateoCourto whileograntingobailounderoSectiono389oofotheoCodeoofoCriminaloProcedureo cannoto makeo ito subjecto too complianceo ofo directiono too deposito ao parto ofo compensationoamountoawardedobyotheotrialoCourt,oasoprovidedounderoSectiono 148oofotheoN.IoAct,o1881.oThereoisoalsoonoomeritoinotheosubmissionothatotheo directionotoomakeoaodepositoinotermsoofoSectiono148oofotheoN.I.oAct,o1881,o cannoto beo beyondo 20%o ofo theo compensationo oro fineo aso directedo byo theo AppellateoCourt.oAomereoreadingoofoSectiono148(1)oofotheoN.I.oAct,o1881o leavesonoomanneroofodoubtothatotheoprovisionsoenvisagesodepositoofoaosumoofo minimumotwentyoperocentoofotheofinalocompensationoawardedobyotheotrialo Court.oInoviewoofotheoclearolanguageoofoSectiono148(1)oofotheoN.I.oAct,o1881,o thereoisonoomeritoinotheosubmissionsoofolearnedocounseloforotheopetitionersothato theodepositocannotobeobeyondo20%.o o o Asoregardsotheosubmissionothatopetitionerohasobeenodirectedotoo makeodeposito25%oofotheocompensationoawardedobyotheotrialoCourtowithino38o days,osufficeoitotoosayothatoasoperotheoprovisionsoofoSectiono148(2)oofotheoN.I.o Act,o1881,otheoamountoreferredotooinosub-sectiono(1)oofoSectiono148oofotheo N.I.oAct,o1881oisotoobeodepositedowithinoaoperiodoofosixtyodaysofromotheodateo ofotheoorder,oorowithinosuchofurtheroperiodonotoexceedingothirtyodaysoasomayo beodirectedobyotheoCourtoonosufficientocauseobeingoshownobyotheoappellant.o o o Accordingly,o thiso Courto doeso noto seeo anyo reasono too interfereo withotheoimpugnedoorderodatedo02.12.2022o(AnnexureoP-4)opassedobyotheo learnedoSessionsoJudge,oPanchkula.oThereoisonooillegalityooroperversityoinotheo orderodatedo02.12.2022o(AnnexureoP-4)oandopresentopetition,obeingodevoido ofoanyomerit,oisoherebyodismissedowithotheoclarificationothatoinotermsoofotheo provisionso containedo undero Sectiono 148(2)o ofo theo N.Io Act,o 1881,o theo petitioneroshallobeoentitledotoodepositotheosaidoamountowithinoaoperiodoofo60o daysofromotheodateoofopassingoofoorderodatedo02.12.2022o(AnnexureoP-4)obyo theolearnedoSessionsoJudge,oPanchkula.ooo o o o o Janauryo04,o2023oo o o o o (HARSHoBUNGER)o gurpreeto o o o o o o o JUDGEo Whetherospeaking/reasoned:o o Yes/Noo Whetheroreportable:o o o Yes/No