The Supreme Court on Thursday termed the pendency of over 35 lakhs of cheque bounce cases as ‘grotesque’ and suggested to the Centre to come up with a law to create additional courts for a particular period of time to deal with such cases.
A five-judge Constitution bench headed by Chief Justice S A Bobde said that Centre has the power under Article 247 of the Constitution coupled with the duty to establish additional courts to deal with cheque dishonour cases under provisions of Negotiable Instruments (NI) Act.
Article 247 of the Constitution gives power to Parliament to establish certain additional courts for the better administration of laws made by it or of any existing laws with respect to a matter enumerated in the Union List.
The bench also comprising Justices L Nageswara Rao, B R Gavai, AS Bopanna and S Ravindra Bhat said, “The pendency of cases that is rising due to NI Act is grotesque. You can make a law to create additional courts for a particular period of time to deal with such cases”.
The top court suggested that Centre can appoint retired judges or any experts on the subject to deal with such cases.
The bench told Solicitor General Tushar Mehta, appearing for Centre, that the NI Act contribute to about 30 per cent of pendency of cases in the judicial system and when the law was enacted no judicial impact assessment was done as required as per the law laid down by the top court.
It said that if the impact assessment was not done when the statute was enacted then why cannot it be done now and Centre can exercise its power provided under the Constitution.
The bench referred to pendency of cases in Bihar and said that thousands of bail matters were pending in the courts of the state after the liquor prohibition Act was enacted.
Mehta, in a contrary stand taken earlier by the Union Finance Ministry stated that after discussion with high level officials about the suggestions of the court it can be said, “it is a welcome move”.
He, however, said though government is open to idea but more discussions are needed on the issue and they need to sort out some of the nitty-gritties involved in the matter.
The bench said that it is posting the matter for hearing on March 10 and asked the Solicitor General to make the statement on the proposed law as it is the duty of the government to create additional courts.
“We will proceed but we would like at the first instance to come from the government,” the bench said, while referring to the view of the Centre.
The top court was hearing a suo motu case to work out a mechanism for expeditious and just adjudication of cases relating to dishonour of cheques, fulfilling the mandate of law and reduce high pendency.
It had earlier referred to a study on the pending cases and said it reflects backlog of more than 35 lakh and noted that dishonour of cheque was criminalised in 1988 and the legislative intent was to “ensure faith in the efficacy of banking operations and credibility in transacting business on cheques.”
On Wednesday, the union finance ministry had told the top court that creation of additional courts to deal with lakhs cheque bounce cases would not solve the problem of backlog of cases in the judiciary as most of them are stuck due to accused not appearing in the matter.
It had directed the Centre to suggest the names of the members, secretaries or officers from various departments for constituting a committee to come out with a solution to reduce the pendency of cheque bounce cases.
The top court had said that it would be necessary to have a former Judge who has had wide ranging experience as a trial judge, on the Committee.
It had noted that there is no doubt or dispute about the fact that matters under the NI Act have posed what by now has become an intractable problem/accounting for close to 30 to 40 per cent of the pendency in the trial courts and a very high percentage in the High Courts also.
On February 25, the top court had asked the Centre whether it can create additional courts under Article 247 of the constitution for expeditious disposal of such matters.
Senior advocate Siddharth Luthra, appointed as amicus curiae in the matter have given certain suggestions to the court for evolving a mechanism for speedy disposal of such cases including sending of summons electronically through e-mail or social media.
On March 5 last year, the top court had registered a suo motu case and decided to evolve a “concerted” and “coordinated” mechanism for expeditious disposal of such cases.
The apex court had passed the order while dealing with a plea related to dishonour of two cheques in January 2005, noted that a dispute of this nature has remained pending for 15 years in various courts and taken judicial time.
The top court had said that despite many changes brought through legislative amendments and various decisions of this court mandating speedy trial and disposal of these cases, the trial courts are filled with a large number of pendency of these cases.