MR. HEMACHANDRA M.KUPPALLI v. M/S R.B.GREEN FIELD AGRO INFRA PVT LTD.

accused No.2. The 1st respondent is the firm represented by its proprietor the 2nd respondent. For the sake of convenience both these respondents would be referred to as ‘respondent’ in this order. Both the petitioner and the respondent have a transaction and the transaction leads to issuance of a cheque by the respondent in favour of the petitioner for an amount of `49/- lakhs drawn on Axis Bank Limited. The cheque when presented for realization was dishonoured for want of sufficient funds on 21-01-2014. The petitioner takes up legal proceedings against the respondent/accused before the learned Magistrate invoking Section 200 of the Cr.P.C., for offence punishable under Section 138 of the Negotiable Instruments Act, 1881 (‘the Act’ for short). The learned Magistrate by order dated 26-08-2015 convicts the respondent in C.C.No.15698 of 2014 holding him to be guilty of the offence punishable under Section 138 of the Act and sentences him to pay a fine of `29,10,000/- and in default to undergo simple imprisonment for a period of ten months. It was further ordered that a sum of 5 `29,00,000/- was to be paid to the complainant by way of compensation under Section 357 of the Cr.P.C., out of the fine amount.

The respondent immediately prefers an appeal before the Principal City Civil and Sessions Judge at Bengaluru invoking the provisions under Section 374 of the Cr.P.C., in Criminal Appeal No.1216 of 2015. During the pendency of the appeal, the Court refers the matter to the Lok Adalat for settlement of dispute between the petitioner and the respondent on 05-05-2016. The matter gets settled before the Lok Adalat on that day and an award is drawn up by the Lok Adalat whereby the accused undertook to pay sum of `29,00,000/- in installments, failing which the petitioner was at liberty to recover `30,00,000/- with 12% interest from the date of the award. The accused fails to make any payment or fails to adhere to the conditions of settlement. The petitioner then files an execution petition before the concerned Court in Execution Case No.640 of 2017 on 03-03-2017 and the present writ petition is preferred on 07-06-2023, 6 years after filing of the execution case alleging that there is no progress in the execution case.

Heard Sri P.P. Hedge, learned senior counsel appearing for the petitioner and Smt. K.P.Yashodha, leaned High Court Government Pleader for official respondents.

The learned senior counsel Sri P.P. Hegde appearing for the petitioner would vehemently contend that this is a tragic case where the petitioner/complainant who has in his favour an order of conviction against the respondent is referred for settlement. Bona fide believing that the respondent would abide by the terms of settlement, he settles the issue before the Lok Adalat. The conviction recorded by the learned Magistrate is set aside on the ground of settlement. 6 years have passed by, but no fruit of settlement has fallen to the share of the petitioner. He would contend that even the executing Court for the last 6 years has been 8 trying to secure the presence of the accused and nothing fruitful has happened as no warrant has been executed and even the arrest warrant issued has not even been executed by the jurisdictional police.

On the other hand, the learned High Court Government Pleader would seek to plead that there are no instructions secured in the case at hand with regard to the execution of warrant against the respondent as the State is not a party to these proceedings. The remedy of the petitioner lies elsewhere.

I have given my anxious consideration to the submissions made by the respective learned counsel and have perused the material on record.

The transaction between the petitioner and the respondent is a matter of record. Towards the said transaction a cheque bearing No.009886 for a sum of `49,00,000/- drawn on Axis Bank was issued by the respondent in favour of the petitioner. The petitioner presents the said cheque before the Bank upon which it 9 had been returned with the endorsement “funds insufficient”. Proceedings under Section 138 of the Act were taken up by the petitioner against the respondent. The concerned Court i.e., the learned Magistrate in terms of the judgment dated 26-08-2015 convicts the respondent for offence punishable under Section 138 of the Act by the following order: “23. POINT No.3: To this point, I made the following: ORDER The accused no. 2 is convicted U/ Sec. 255 (2) of Cr.PC for the offence punishable U/Sec 138 of N.I Act. The accused is sentenced to pay fine amount of Rs. 29,10,000/- (Rupees Forty Nine Lakh Ten thousand only).

Here begins the trauma of the complainant. The respondent deviates from the terms of settlement and does not pay a penny to the petitioner which brings the petitioner to file an execution petition in Execution Case No.640 of 2017, as in law, an award of the Lok Adalat is said to be a decree which is executable. Therefore, execution proceedings were initiated by 12 petitioner/complainant. For the last 6 years securing presence of the accused/respondent has been a herculean task, despite issuing arrest warrant and the shara indicates that arrest warrant could not be executed as the addressee has left. Therefore, respondent/accused has been dodging payment despite the sword of conviction which was hanging on his head being taken away on account of the settlement before the Lok Adalat. In the light of passage of 6 years, the petitioner has knocked the doors of this Court at this juncture seeking the following prayer: “WHEREFORE it is prayed that this Hon'ble Court be pleased to

Issue a writ of mandamus for expeditious disposal of Execution Case No.640/2017 on the file of City Civil & Sessions Judge at Bengaluru (CCH-57) vide Annexure 'E';

Issue a writ of mandamus or any other appropriate orders or directions to Respondent nos. 3 to 5 to arrest and cause production of Respondent nos.1 and 2 before the City Civil & Sessions Judge at Bengaluru (CCH-57) by executing the arrest warrant issued in Execution Case No.640/2017 vide Annexure 'E';

3. In the event of respondents 1 and 2, failing to satisfy the award within the time limit that may be fixed by this Hon'ble Court, it is prayed that this Hon'ble Court be pleased appropriate writ/order for restoration of the judgement of conviction and sentence dated 26- 08-2015 passed in C.C.No.15698/2014 on the 13 file of XXI Additional Chief Metropolitan Magistrate at Bengaluru vide Annexure 'A' by recalling the settlement arrived before the Lok Adalat as per Award dated 05-05-2016 passed by Lok Adalat in Criminal Appeal No.1216/2015 on the file of City Civil and Sessions Judge, Bengaluru(CCH-57) vide Annexure 'C'; And issue appropriate writs to the trial court to execute the conviction police/respondent nos. 3 to 5 to assist in executing the conviction warrant and submit compliance report for this Hon'ble Court. directing warrant

4. Grant such other and further reliefs as this Hon'ble Court deems fit to grant under the circumstances of the case, in the interest of justice.” (Emphasis supplied) The aforesaid prayers are sought in a piquant circumstance that a complainant/victim who has lost money and who also has a judgment of conviction against the accused in his favour offers himself for a settlement before the Lok Adalat. The conviction goes away on account of such settlement on certain terms and conditions. Not a single term or condition is adhered to by the accused. Therefore, for the sake of setting aside the conviction, settlement has been entered into, and the accused with impunity is dodging the clutches of law for the last 6 years. No doubt the award of the Lok Adalat is an executable decree in terms of law. 14 Therefore, the petitioner prefers an execution case which is also pending consideration for the last 6 years. In these circumstances, the aforesaid prayers are sought. Whether they are grantable is what requires to be considered.

The first of the prayers is for a direction to the executing Court for expeditious disposal of the case before it. The other prayer is restoration of the order of conviction. The award of the Lok Adalat, as is held by the Apex Court in the case of K.N. GOVINDAN KUTTY MENON v. C.D. SHAJI – (2012) 2 SCC 51, is akin to a decree passed by the civil Court which is executable. There can be no qualm about the principle enunciated by the Apex Court in the case of K.N.GOVINDAN KUTTY MENON (supra) which has been consistently followed. The case at hand projects a different circumstance. The difference in circumstance is the conduct of the accused. The matter was referred to the Lok Adalat on account of a joint memo being filed by the complainant and the accused. 15

The Court need not accept the joint memo and refer the matter to the Lok Adalat as the matter was at the stage of arguments. But, the Court accepts the joint memo and sends the matter for settlement to the Lok Adalat. At that juncture the Court ought to have noticed whether there has been compliance with the judgment of the Apex Court in the case of DAMODAR S.PRABHU v. SAYED BABALAL.H1 wherein three Judge Bench of the Apex Court laid down certain guidelines with regard to the settlement in a dishonour case for offence punishable under Section 138 of the Act. The Apex Court has held as follows: “…. …. …. ….

8. Before examining the guidelines proposed by the learned Attorney General, it would be useful to clarify the position relating to the compounding of offences under the Negotiable Instruments Act, 1881. Even before the insertion of Section 147 in the Act (by way of an amendment in 2002) some High Courts had permitted the compounding of the offence contemplated by Section 138 during the later stages of litigation. In fact, in O.P. Dholakia v. State of Haryana [(2000) 1 SCC 762 : 2000 SCC (Cri) 310] a Division Bench of this Court had permitted the compounding of petitioner's conviction had been upheld by all the three designated forums. After noting that the petitioner had already entered into a compromise with the complainant, the Bench had rejected the State's argument that this Court need not interfere with the conviction and sentence the offence even though 1 (2010) 5 SCC 663 16 since it was open to the parties to enter into a compromise at an earlier stage and that they had not done so. The Bench had observed: (SCC p. 763, para 3)

3. … taking into consideration the nature of offence in question and the fact that the complainant and the accused have already entered into a compromise, we think it appropriate to grant permission, in the peculiar facts and circumstances of the present case, to compound.

O R D E R (i) Writ Petition is allowed in part. (ii) The award dated 05-05-2016 passed by the Lok Adalat on a reference by the learned LVI Additional City Civil and Sessions Judge, Bengaluru City in Criminal Appeal No.1216 of 2015 stands quashed. (iii) The proceedings before the learned LVI Additional City Civil and Sessions Judge, Bengaluru City in Criminal Appeal No.1216 of 2015 stands restored. 30 (iv) The learned LVI Additional City Civil and Sessions Judge, Bengaluru City shall regulate the procedure to consider the appeal on its merit, and pass appropriate orders, in accordance with law. Sd/- JUDGE BKP CT:SS