The Supreme Court directs all states and union territories to file status reports on cheque bounce cases, reviewing the Special Courts pilot study for speedy disposal under Section 138 of the NI Act.
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NEW DELHI: The Supreme Court of India has once again taken proactive steps to ensure the expeditious disposal of cheque bounce cases under Section 138 of the Negotiable Instruments (NI) Act, 1881. On Tuesday, a bench comprising Justices Vikram Nath and Sandeep Mehta directed all states and union territories to file status reports detailing the measures taken to accelerate the resolution of such cases.
Background
Section 138 of the NI Act deals with cases where a cheque is dishonoured due to insufficient funds or other discrepancies. Cheque bounce cases are notoriously slow to resolve in India, contributing significantly to the backlog of criminal cases. As of December 31, 2019, there were 35.16 lakh pending cheque bounce cases out of a total of 2.31 crore criminal cases in the country.
The Supreme Court had first recognized the urgency of these matters in March 2020, taking suo motu cognizance of the pendency. The court had then initiated steps to create a concerted and coordinated mechanism for speedy trials.
The 2022 Pilot Study: Special Courts for Cheque Bounce Cases
In May 2022, the apex court issued a landmark order directing the constitution of 25 special courts across five states, Maharashtra, Delhi, Gujarat, Uttar Pradesh, and Rajasthan, to pilot the speedy disposal of Section 138 NI Act cases.
Key points of the pilot study included:
- One special court per judicial district in the five states identified with the highest pendency.
- Employment of retired judicial officers and court staff, preferably those retired within the past five years.
- Focus on cases where summons were duly served and the accused had appeared either in person or through a lawyer.
- One-year pilot period: From September 1, 2022, to August 31, 2023.
- High courts to ensure no vacancies during this period.
The pilot study aimed to test whether special courts can significantly reduce the backlog of cheque bounce cases.
Supreme Court Seeks Status Reports
Senior Advocate Sidharth Luthra, assisting the court as amicus curiae, highlighted the importance of reviewing the pilot study’s progress. He emphasized the need for status reports detailing steps taken, appointments made, and data on existing vacancies.
The bench directed:
- All states, union territories, and high court registrar generals to submit the necessary status reports within six weeks.
- The matter is to be reviewed after six weeks to assess the effectiveness of the pilot project.
This step reflects the Supreme Court’s commitment to ensuring timely justice and reducing pendency in cheque bounce cases.
Apart from creating special courts, the Supreme Court had also:
- Directed the Central Government to amend laws to allow the clubbing of multiple cases filed against the same person within a year.
- Issued a slew of directions to all stakeholders to accelerate trials and reduce delays.
These measures aim to curb the mounting backlog and prevent prolonged litigation for individuals involved in financial disputes.
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