IN RE: EXPEDITIOUS TRIAL OF CASES UNDER SECTION 138 OF N.I. ACT 1881 Supreme Court Case

IN RE: EXPEDITIOUS TRIAL OF CASES UNDER SECTION 138 OF N.I.  ACT 1881 Supreme Court Case

Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले

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REPORTABLE

 IN THE SUPREME COURT OF INDIA

CRIMINAL ORIGINAL JURISDICTION

SUO MOTU WRIT (CRIMINAL) NO. 2 OF 2020

IN RE: EXPEDITIOUS TRIAL OF CASES UNDER SECTION 138 OF N.I.

 ACT 1881

O R D E R

S. RAVINDRA BHAT, J.

1. By a judgment of the Constitution Bench of this Court in Re: Expeditious

Trial of Cases under Section 138 of N.I. Act, 18811 various directions were issued

with respect to the conduct of trials of complaints under Section 138 of the

Negotiable Instruments Act.

2. This court by its subsequent order dated 31.03.2021 had required High

Courts to file status reports indicating compliance with the directions contained

in the judgment and as to whether rules were framed appropriately in line with the

judgment. Similarly, the necessary amendments to the Police Manuals etc. had to

be carried out. As on date, all High Courts except the Patna High Court have

complied with the directions and proposed the amended Rules. In many states,

amended rules have even been notified.

3. On 16.04.2021, by the said judgment of the Larger Bench, an expert

Committee was constituted to consider various suggestions with respect to

streamlining the procedure of arresting the judicial docket, in regard to complaints

and trials for offences under the Negotiable Instruments Act. The Expert

Committee, by its report has suggested the creation of de novo Special NI Courts

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(2021) SCCOnline SC 325

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by the Central Government vide its powers under Article 247 to tackle the problem

of docket explosion. The Expert Committee proposed a scheme with two grades of

judges at the trial court level and two at the appellate/revision stage. According to

the Expert Committee’s calculations, the establishment ofthese special NICourts

would require recruitment of 1,826 special judicial officers and a total cost of Rs

126.59 crores.

4. The amici curiae urged, in the hearing that the suggestion of creation of

special courts with the proposed staffing pattern may not be feasible or practical,

as it would not be possible to immediately establish de novo courts and recruit fresh

candidates and support staff. It was urged that the option of appointing retired

judicial/administrative officers who have worked and discharged quasi-judicial

functions such as retired Tehsildars, Special executive Magistrates, Registrars of

Tribunals and statutory authorities and High Courts etc officers as Special

Judicial/Metropolitan Magistratesfor a fixed pay be explored.

5. Special Magistrate’sCourtsfor conducting trial of cases underthe NI Act can be

constituted under Section 18 of Cr.P.C, 1973 (along with S.13, Cr.P.C). There is

authority for this course of action – (ref.KadraPahadiya v.StateofBihar,[(1997)

4 SCC 287]. Retired public servants, such as tehsildars and magistrates can be

considered for appointment as Special Judicial/Metropolitan magistrates. Retired

government personnel and retired court staff could be appointed for

operationalising these courts.

6. The report of the Expert Committee disclosed that as on 08.11.2021,

26,07,166 complaints were pending at various stages before the Courts seized of

trial of offences under the NI Act. As on 13.04.2022, this pendency has increased

to 33,44,290. This is an increase in pendency of 7,37,124 cases in a period of just

over 5 months. As per the data available on 08.11.2021, NI Act cases contribute

to 8.81% of the total criminal cases pending in the courts. Further, 11.82% of the

total criminal cases that are stagnating due to appearance/service related issues are

NI Act cases.

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7. The amici curiae suggest a pilot study to test the scheme of employing retired

judicial officers and retired courtstaffto operationalise theSpecialCourts underthe

NIAct.Itwassuggested that thisscheme could be tested on a pilot basisin 5 judicial

districts with the highest pendency in the 5 states with the highest pendency

(namely, Maharashtra, Rajasthan, Gujarat, Delhi and Uttar Pradesh) and the

viability of utilising services of retired judicial officers can be examined based on

the results of the pilot study.

8. ThisHigh Court has by its order dated 27.04.2022 directed theHighCourtsin

the states of Maharashtra, Rajasthan, Gujarat, Delhi and Uttar Pradesh to respond

to the suggestions of the amici curiae. Their responses are as under:

a. High Court of Bombay – The High Court has identified Nagpur,

Nashik, Thane, Pune and CMM, Mumbai as the 5 districts with highest

pendency.

b. High Court of Rajasthan – The High Court has identified Jaipur

Metro-I, Jaipur Metro-II, Jodhpur Metro, Udaipur and Ajmer as the 5

districts with highest pendency.

c. High Court Allahabad – The High Court has identified Lucknow,

Agra,Kanpur,GautambudhNagar and Ghaziabad as the 5 districts with the

highest pendency.

d. High Court of Gujarat – The High Court has given concurrence for

establishing one additional court to try cases under S. 138 of the N.I. Act as

per the pilot project.

e. High Court of Delhi: Delhi already has 72 Special Courts for cases

under the NI Act.

9. This Court had on 12.05.2022 indicated that the amici curiae may place a

detailed proposal for the pilot study, which has since been filed.

10. Having considered the suggestions made by the amici the Court hereby

directs that the pilot study shall be conducted in the manner hereafter indicated.

The guidelines covering the pilot study shall be as under:

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• Duration of Study: The pilot study shall be conducted for a duration of 1

year from 01.09.2022 to 31.08.2023.

• Number of Courts: The pilot study shall be conducted in 25 Special Courts

in total. One Special Court shall be established in each of the 5 judicial

districts which have been identified as having thehighest pendency by each of

the five High Courts ofthe states(mentioned above) with the highest pendency of

NI Act cases.

• Presiding Officers and Staff: For operationalising the Special Courts under

this pilotstudy,retired judicial officers and retired courtstaff, preferably those

who have retired within the past 5 years, may be employed. The concerned

High Court shall ensure that no vacancy arises, during this period.

• Timeline for Identification of Requirements: The infrastructural

requirements, including information technology support for video

conferencing facilities, should be identified and secured by July 2022.

Similarly, the presiding officers, support staff and human resources required

for operationalising these SpecialCourts and their contractual termsshould be

finalised by the end ofJuly 2022.

• Training: The identified judicial officers, who are to preside over the Special

Courts, be imparted specialised training. A four-week training programme

by the State Judicial Academies on topics of substantive, procedure and

evidence law related to the offences under the NI Act shall be conducted for

them. Further, a detailed ready reckoner with governing case law and practice

directions may be prepared and circulated to assist them in the adjudicatory

exercise.

• Pay and Service duration: The High Court concerned should ensure that

the presiding officers and court staff for operationalising the Special Courts

can be hired on contractual basis for one year for the duration of the pilot

study. It is further proposed that they be paid a fixed honorarium in

accordance with their standing prior to retirement.

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• Type of Cases: The Special Courts shall adjudicate upon only those cases in

which summons have been duly served and the accused has entered

appearance through a lawyer or in person. The oldest pending casesin which

service ofsummons is complete must be identified in a chronological manner

(oldest first). It must be ensured that no case where service of summons is

incomplete is sent to the Special Courts.

• Timeline for Identification of Cases: All such cases should be identified by

July and a comprehensive listofthesecasesshould bepostedbeforethe regular

Magistrates expeditiously so that cases which can be settled are referred to

mediation immediately and are hence, not part of the cases to be sent to the

Special Courts. The final comprehensive list of cases, where service is

complete and the matters are not referred to mediation, must be identified by

the end of July.

• Advance List and Weekly List: An advance list of all matters to be taken up

by the Special Courts should be circulated by the end ofJuly to give adequate

notice to all counsel that such matters shall be taken up on priority basis by

the respective Special Courts. Further, weekly lists shall also be published

notifying all the matters listed for final disposal.

• Functioning of Courts: The working days and working hours of the Special

Courts should be notified by the end of July along with the circulation of the

Advance List.

• Procedure: The Special Courts set up for the pilot study shall follow the

same procedure with respect to trial as mandated by the Criminal Procedure

Code, 1973. In order to ensure speedy disposal of cases, adjournmentsshould

not be routinely given, especially on the ground of lack of notice. Further

examination of outstation witnesses may be conducted online by following

appropriate protocol so that the delay in trial due to commute of the witnesses

is avoided.

• Mediation: A list or panel of mediators must be identified by the end of July

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and circulated to all the presiding officers of the Special Court. In the event

that the accused indicates willingnesstosettleatstageoftrialbeforetheSpecial

Court,thepresidingofficermustreferthecase to time-bound, online mediation

before one of the identified mediatorsto prevent further delays.

• Data Collection: A weekly statement of disposalshall be sent to the Registrar

General of the concerned High Courts who shall actively monitor the

progress of the pilot study. Quarterly statements of disposal must be sent to

the SC. A Facilitation Officer may be appointed for the Special Courts to

assist in collection of the data, in curating the cause lists and in conducting

weekly review meetings with Presiding Officers to identify any additional

bottlenecks orissues which need to be assessed for future planning purposes.

11. The Secretary General of this Court shall ensure that a copy of the present

order is directly communicated to the Registrar Generals of the said five High

Courts, who shall place it before the Hon’ble Chief Justice for immediate action.

To report progress and compliance, each of the said five High Courts shall file an

affidavit on or before 21.07.2022. List on 26.07.2022 to review the further

proceeding.

...........................................................................J.

 [L. NAGESWARA RAO]

…......................................................................J.

 [B.R. GAVAI]

..........................................................................J.

 [S. RAVINDRA BHAT]

New Delhi,

May 19, 2022.