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RECOVERY OF COMPENSATION IN A CHEQUE BOUNCE CASE UNDER NI ACT

THE COMPENSATION RECOVERABLE IN A CHEQUE BOUNCE CASE EVEN THOUGH THE ACCUSED HAS UNDERGONE JAIL Term in a CHEQUE BOUNCE case under Section 138 Negotiable Instrument Act


can the complainant demand the compensation and cheque amount from the accused and recover the said amount from the accused?

even if the accused is convicted by the Court and sent to jail and he served the jail punishment, 


And the answer is yes the complainant can even than claim and recover the same from the accused held by SUPREME COURT OF INDIA . 


Hon'ble Supreme Court in Kumaran vs State of Kerela vs Anr.;


The question that arose before the Hon’ble Supreme Court of India was that what happens to the money receivable by the Complainant in the form of Compensation when the Accused undergoes jail term, in default of the compensation, under such circumstances is the Compensation still recoverable by the Complainant?


The Hon’ble Supreme Court observes that that the gravity of offences under the Negotiable Instruments Act cannot be associated with offences under the provisions of the Penal Code, 1860 or other criminal offences. An offence under Section 138 of NI Act is in the nature of a civil wrong which has been given criminal implications.


The statutory remedy in Negotiable Instrument Act* appears to be both punitive as well as compensatory in nature.


The punishment under Section 138 of NI Act is not merely seeking retribution, but it is more a means to ensure payment of money to the holder of the Complainant as his interest lies largely in recovering the money rather than seeing the drawer of the cheque behind bars.


In the matter of Kumaran versus State of Kerala & Anr the Hon’ble Supreme Court has held that:


“so long as compensation has been directed to be paid under Section 357(3), Section 431, Section 70 IPC and Section 421(1), even though a default sentence has been suffered, yet, compensation would be recoverable in the manner provided under Section 421(1) of the Code of Criminal Procedure.”


Conclusion:-

"THE COMPENSATION IS STILL RECOVERABLE IN A CHEQUE BOUNCE CASE BY COMPLAINANT EVEN THOUGH THE ACCUSED HAD SERVED DEFAULT SENTENCE".


So in a cheque bounce case under Section 138 NI act the cheque amount along with compensation money can be recovered from the accused and accused cannot escape from his liability even if he completes his sentence in jail even if he is liable to pay the cheque amount plus compensation to the complainant as ordered by the concerned court and there  is no escape for him.



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