This article is written by Arkadyuti Sarkar. This article discusses in detail the provisions relating to affidavits in a trial under Section 145 of the Negotiable Instruments Act of 1881. It also discusses in detail the recent case laws in relation to this section. 

Introduction

The Negotiable Instruments Act of 1881 is a significant law concerning the governance of negotiable instruments in India and is concerned with regulating promissory notes, cheques, and bills of exchange. The Act was enacted by the British to provide uniformity in the legal framework for using negotiable instruments in India. It has been subjected to multiple amendments to comply with the changing commercial practices and legal requirements. The most notable among these amendments is the Amendment of 2022. Several new sections, i.e., Sections 143 to 147 were introduced by this amendment for widening the scope and mitigating the limitations of the parent statute that came into force on 1st March 1882. The sections were introduced under Chapter XVII which was primarily for penal provisions as an accused under this act could be charged with offences of cheque dishonour arising from the deficiency of funds. The Ministry of Finance is the nodal organisation regulating the system concerning negotiable instruments. The transfers from one person to another in dealings of legal documents of monetary value are known as negotiable instruments. The legal term for negotiable stands for something transferable from the transferor to the transferee through delivery involving the transfer of title without any endorsement from the transferee.

This article is going to provide a clause-to-clause analysis of Section 145 of the Negotiable Instruments Act, 1881 which is concerned with adducing evidence through an affidavit by the complainant, as well as examining a witness upon an application for the same made either by the accused or the complainant/prosecution). Such analyses are supported by several case laws that have been referred to by the courts from time to time.

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Let’s understand the meaning of Section 145 of the Negotiable Instruments Act of 1881. 

Section 145 of Negotiable Instrument Act, 1881

To understand and explain the provisions of Section 145 of the Act of 1881, let us give it a reading:

  1. Not being affected by anything in the Criminal Procedure Code, 1973 (now Bharatiya Nagarik Suraksha Sanhita, 2023), the complainant may give his evidence through an affidavit subject to all just exceptions and be read during evidence in any inquiry, trial, or other proceeding under the said Code.
  2. The Court may, at its discretion, and on an application of the prosecution or the accused, summon, and examine any person who is adducing evidence on affidavit as to the facts contained therein.

It can be seen that Section 145 (1) is concerned with adducing evidence through an affidavit by the complainant, while Section 145 (2) discusses the discretionary power of the Court to summon and examine any witnesses related to the proceeding under the Act of 1881.

Let us separate the ingredients of both subsections to have an overall understanding. However, let us conceptualise evidence on the affidavit.

Evidence on affidavit

An affidavit accounts for someone’s evidence or factual statements in written form. The word has its Latin roots meaning “he has stated on oath”. The benefit of presenting evidence through an affidavit is that each party to the case is aware of what the other party or its witnesses will say at the trial. This way both the parties to the case will benefit while preparing for the trial and hence each can obtain sufficient advice on the prospect of success.

Section 145 (1) of the Act of 1881

  • Notwithstanding anything contained in the Code of Criminal Procedure, 1973: This means that no provision present in the Criminal Procedure Code (now Bharatiya Nagarik Suraksha Sanhita, 2023) will impact this provision of the Act of 1881.
  • The evidence of the complainant: The word complainant is not defined anywhere in the Act of 1881. However, as with the legislative intent of the Act of 1881, we can infer that a complainant can be any person or entity who was promised a certain amount by the accused through some negotiable instrument with the same being dishonoured and has remained unpaid even after sending the demand notice, thereby compelling the complainant to file a complaint under this Act. 

Section 145(1) is only concerned with adducing evidence on affidavit by the complainant in cases under the Act of 1881 as the same has been observed in cases like Mandvi Cooperative Bank Ltd. vs. Nimesh B. Thakore (2010), Prabhudas Panjainmal Rice and Dal Mill vs. Avon Trade Link Shakti Nagar, Katni (2020), etc. The aforementioned cases have been discussed subsequently in later portions.

  • The meaning of “subject to all just exceptions”: Since Section 145 (1) does not list any exception anywhere we can infer from the wording that it refers to judicial discretion concerning the consideration of “just exceptions” and may vary from case to case. Mandvi Cooperative Bank Ltd. vs. Nimesh B. Thakore, (2010), Prabhudas Panjainmal Rice and Dal Mill vs. Avon Trade Link Shakti Nagar, Katni (2020), etc are a few examples wherein the said principle has been upheld.
  • The meaning of “be read in evidence in any inquiry, trial, or other proceeding under the said Code”: Here, it is inferable that reference has been made to any inquiry, trial, or other proceeding under the Criminal Procedure Code (now Bharatiya Nagarik Suraksha Sanhita, 2023 w.e.f. 01.07.2024). 

Thus, we can conclude that Section 145(1) of the Act of 1881 entitles the complainant to adduce evidence by making an affidavit. Such evidence can be used in any other trial/proceeding under the Criminal Procedure Code, 1973 (now Bharatiya Nagarik Suraksha Sanhita, 2023).

Section 145(2) of the Act of 1881

  • The Court may, if it thinks fit: This clearly indicates the discretionary power vested upon the concerned court with regard to the summoning and examining of any person who has adduced his evidence on an affidavit in a proceeding under the Act of 1881.
  • Shall on the application of the prosecution or the accused: The proceeding under the Act of 1881 is inherently criminal and resembles any other criminal proceeding, it comprises the prosecution and the accused. Now, apart from the Court’s discretionary power to summon any witness, who has adduced his evidence through an affidavit, for examination, it can also call/re-summon for such witnesses for re-examination if the prosecution or the accused makes an application before the Court requesting the same.
  • Summoning and examining: For examining anyone, the very first step is securing their attendance before the Court. Such attendance can be secured either by service of summons or by issuing a warrant of arrest. Now this subsection provides for the issuance of summons to secure such attendance for examination, either at the discretion of the court or upon the application by the prosecution or the accused.

Summoning and examining under Section 145 (2) includes re-summoning and re-examining the witnesses who have already adduced their evidence through an affidavit under this section. For references see Mandvi Cooperative Bank Ltd. vs. Nimesh B. Thakore, (2010), Sumitra Devi vs. Kapoor Chand (2023), etc. as have been discussed afterwards.

  • Any person giving evidence on affidavit: As per the wording of this subsection, summons can only be issued to a person under this section of the Act of 1881 if such person has adduced his evidence in a proceeding under this Act through an affidavit.
  • Facts contained therein: Now the summoning and examination to be done under this proviso can only be with respect to the facts contained in the evidence adduced before the Court under a proceeding under this Act and nothing else. Section 145(2) expressly mentions the same.

Case laws relating to Section 145 of Negotiable Instrument Act, 1881

Sumitra Devi vs. Kapoor Chand (2023)

Facts of the case

  • In this case, the petitioner had approached the Himachal Pradesh High Court against the rejection of an application filed by her;
  • The application was requested for her re-examination by the First Class Judicial Magistrate, Anni, Kullu District, Himachal Pradesh;
  • The petitioner had preferred a complaint under the Negotiable Instrument Act, 1882 for cheque dishonour by the accused/respondent for payment towards her salary;
  • In the complaint, she claimed that the said cheque was issued by the respondent as Director of BHK Construction Company; 
  • An affidavit in evidence was filed by the petitioner during the examination in chief and afterwards, she was cross-examined by the respondent;
  • At one point of such cross-examination, she admitted it to be correct that the respondent was also an employee of the company just like her;
  • During cross-examination no liberty was prayed by her counsel for re-examining her regarding this part of the statement made by her in cross-examination as in examination-in-chief she stated that the respondent was the Director of the Company;
  • Afterwards, however, a petition was filed on behalf of her for her re-examination by proposing the filing of an affidavit in re-examination, stating that the respondent was Chairman of the Company and had issued the cheque in her favour on behalf of the referred company.

Arguments by the petitioner

  • The learned counsel of the petitioner referred to various cases like Rajendra Prasad vs. Narcotic Cell (1999), P. Chhaganlal Daga vs. M. Sanjay Shaw (2003) and argued that a fact has come in the record during cross cross-examination;
  • The said fact is in conflict with the contents of the examination-in-chief;
  • Further, it was argued that in view of the provisions of Section 138 of the Indian Evidence Act, 1872 (now Bharatiya Saksha Adhiniyam) and Section 145 of the Act of 1881, the petitioner is entitled to re-examination;
  • Such right for re-examination arises because clarification and truth about the said point is necessary for complete, final, and proper adjudication of the case;
  • Therefore, the petitioner further argued that the proposed re-examination of the petitioner shall not result in filling up the lacuna by the petitioner.

Arguments by the respondent

Judgement of the court

  • The Hon’ble High Court duly considered the provisions of the Act of 1881, especially Section 145(2); 
  • The court held that it is apparent that after filing an affidavit by the complainant or his witness/witnesses, any person adducing evidence on affidavit can be summoned and examined by the Court upon an application filed by the prosecution or the accused; 
  • The summoning should be concerned with the facts present in such an affidavit;
  • The court further noticed that the section further provides for examining a person, including re-examining a person, but does not entitle the complainant or anyone filing an affidavit in examination-in-chief to re-file an affidavit in evidence; 
  • Therefore, such a person, including the complainant, can be summoned and examined by the Court upon application by either party; 
  • The court finally concluded that Section 145 does not provide or entitle the complainant or anyone to file a fresh affidavit during examination on summoning by the court under Section 145 (2) though the same does not explicitly mention re-examining the complainant or any other witness;  
  • The court also opined the term summon and examined any person giving evidence in an affidavit including the judicial power of the court to summon and re-examine such witness/person.

Harihar Mishra and Anr. vs. M/s. Acrux Realcon Pvt. Ltd (2023)

Facts

  • In this case, the complainant/respondent had filed the complaint after the cheques issued by the accused persons/petitioners were dishonoured due to insufficient funds;
  • The complaints were supported by affidavits and based on the affidavits S.D.J.M. Bhubaneswar took cognizance of the offence under Section 138 of the Act of 1881 and summoned the petitioner;
  • However, when the trial commenced, affidavits as evidence were filed by the complainant and the same became the subject matter of dispute in this case;
  • The reason was that the petitioner/accused vehemently argued that the reproduction of the affidavits by the complainant was unacceptable as they had already been filed while filing the suit, based on which the court had proceeded and taken cognizance;

Issues raised

Whether the complainant is entitled to file a second lot of affidavits if the same were filed already in the beginning of the trial as evidence?

Arguments by the petitioner

  • The petitioner argued that for the purposes of Section 138 of the Act of 1881, the lower court could not have received the affidavits for the second time as they were already filed at the beginning by the accused;
  • The petitioner contended that since the court rejected his applications on the ground that the initial affidavits were received for and at the time of taking cognizance of the offence and thereafter the affidavits were filed in conformity with Section 145.

Arguments by the respondent

  • Contrarily the respondents justified the impugned orders and contended that the affidavits have been adduced as evidence and the court has accepted them;
  • They further contended that such acceptance has no linkage with initial affidavits that were submitted alongside the complaints.

Analysis

The Odisha High Court cited the case of Indian Bank Association and others vs. Union of India and others (2014) and opined, “The Supreme Court held that Section 145 of the Act of 1881 provides complete freedom to the complainant either to give his evidence by way of affidavit or by oral means and the court has to accept the same even if it is in the form of an affidavit… In the said decision, it has been further observed that the affidavit and documents filed along with complaint for taking cognizance of the offence are good enough to be read as evidence at both the pre-summoning and post-summoning stages”.

Judgement

  • The High Court rejected the petitioner’s contention while holding that the authorities and the decisions relied upon by the petitioner do not make it appear that the complainant/respondent is debarred from filing such an affidavit in evidence;
  • The court further held that the initial affidavits, if at all had been received by the learned court with the complaints, the same were and may be said to be for a limited purpose, for setting the criminal action into motion;
  • That afterwards at the trial stage any such affidavit so furnished as evidence is to be accepted as the court is not debarred under Section 145 against the same;
  • The court further held that it is one thing to claim that an affidavit filed and received by the court may be treated as evidence and is sufficient for the purpose of trial, however, it is altogether different to claim that an affidavit adduced as evidence under Section 145 cannot be accepted as evidence as the same has already been filed in the inception by the complainant.

Prabhudas Panjainmal Rice and Dal Mill vs. Avon Trade Link Shakti Nagar, Katni (2020)

Facts of the case

  • The appeal was filed before the Himachal Pradesh High Court in the above-mentioned case;
  • The appeal was filed against an impugned order on 8th April 2019, passed by the Additional Chief Judicial Magistrate;
  • The order had led to the dismissal of an application filed under Section 145(2) of the NI Act that the accused/petitioner had filed.

Issues raised

  • Whether the court has any discretion concerning an application under Section 145 (2) of the Negotiable Instrument Act, 1881, for summoning and examining any person giving evidence on the affidavit?
  • Whether the procedure adopted by the Magistrate Court while entertaining the above-mentioned application is just and proper?

Arguments of the petitioner

Arguments of the respondents

Judgement of the court

  • The Hon’ble High Court of Himachal Pradesh referred to all the judgements presented by both the Petitioner and the respondent and held that a clear legal proposition had been laid down in Mandvi Co-operative Bank Ltd. vs. Manish B. Thakore (2010) and Rajni Dhingra vs. Sanjiv Chug (2019);
  • The petitioners being the accused were facing trial due to complaint made by the respondents under the provisions of the Act of 1881 and were held to be non-eligible to tender their evidence through affidavit;
  • The court dismissed both the petitions and further held that no error was committed by the trial court while declining permission to this effect to the accused petitioners;
  • It was concluded that a court can entertain evidence to be adduced through an affidavit, only if an application is made by the complainant under the provisions of Section 145 (1) and the same does not extend to the accused.

M/S. Mandvi Co-Op Bank Ltd vs. Nimesh B.Thakore (2010)

Facts

  • In this case, the High Court had a large number of writ petitions and applications before it under Section 482 of the Code of Criminal Procedure where most were filed on behalf of the accused and a few at the instance of the complainants;
  • Based on the grievances and reliefs prayed in those petitions the High Court had to consider two questions:
  1. Whether Section 145(2) of the Act of 1881 confers unfettered right to the complainant and the accused to apply to the court to seek direction for giving oral examination-in-chief of a person adducing evidence on affidavit, even for facts stated therein and upon exercising such right whether the court is obliged to examine such a person despite the mandate under Section 145 (1)?
  2. Whether the amended provisions of Section 145, as amended by the Amendment Act of 2002 have a retrospective application? 
  • The High Court held that the complainant or his witness may be summoned by the court, if they have adduced their evidence on affidavit, for questioning. The Court further held that such a witness can also be summoned on an application by the accused, however, the right would be limited to cross-examination of the witness;
  • Concerning the second issue the High Court held that provisions of Section 145 were not substantive but only procedural in nature, and therefore, and thus have retrospective effect;
  • The High Court also laid down several guidelines upon being requested by both the parties concerning the procedure to be followed by the trial court, the accused, and the complainant in a complaint made against cheque dishonour under Section 138 of the Act of 1881;
  • Seven appeals in the form of special leave petitions were filed against the decision out of which three were referred before the concerned bench of the Supreme Court.

Issues

The appeal was filed before the Supreme Court to consider the special provisions enshrined in Section 145 of the Act of 1881 for a trial concerning dishonoured cheques and to consider how far certain assertions made by the accused comply with the provisions contained in the two subsections.

Arguments by the petitioner

The petitioners raised their contentions on several points with most pointing towards the admissibility of evidence tendered by the accused through an affidavit under Section 145 (1).

Judgement

The Supreme Court held that the High Court has erred in considering that upon a request made by the accused, the Magistrate may allow him to adduce evidence on an affidavit under Section 145 and set aside the High Court direction and judgement and held that only the complainant is entitled to tender such evidence.

Radhey Shyam Garg vs. Naresh Kumar Gupta (2009)

Facts

  • In this case, the respondent/appellant had filed a complaint before the Court of Chief Metropolitan Magistrate, Delhi around 7th June 2004;
  • The case was concerned with the commission of an alleged offence under Section 138 of the Act of 1881 wherein the complainant recorded the pre-summoning evidence by adducing an affidavit;
  • The court took cognizance of the offence and directed the summons by an order on 9th June 2004;
  • The complainant had further adduced post-summoning evidence through an affidavit on 26th March 2007;
  • The respondent examined himself and was cross-examined in detail starting from 12th September 2008. However, before the cross-examination, the respondent/appellant had proven his affidavits;
  • An application under Section 145 (2) of the Act was filed by the appellant on 7th March 2008 against an order dated 14th March 2008, which was dismissed;
  • Then the appellant filed an application before the Delhi High Court under Section 482 of the Criminal Procedure Code, 1973 for setting aside the said order and the same went against him.

Issues Involved

Whether the deponent who has already adduced his/her evidence through an affidavit under Section 145 (2) be re-summoned for examination?

Arguments by the petitioner

  • The petitioner contended that a plain reading of section 145 of the Act of 1881 would make it evident that the same is imperative in character;
  • The petitioner further urged based on the said provision that the court has no option other than examining a witness including the complainant who adduced an affidavit to support his statement;
  • The petitioner’s counsel drew the court’s attention to Section 145(2) and Section 296 of the Criminal Procedure Code and urged that the same being in pari materia with Section 145 of the Act of 1881, and therefore the learned Trial Judge as well as the judge of the High Court to be held liable for committing a serious error in passing the impugned judgement.

Arguments by the respondents

  • The respondent appeared in person and drew the attention of the court to some disturbing facts concerning the signature of the respondent;
  • The signatures of the respondent/appellant appearing at the end of the verification portion as well as his signatures appearing in the affidavit affirmed in support of the stay application would appear different.

Judgement

The court did not find any justification for arriving at a finding that a witness can be re-summoned for his examination-in-chief despite tendering evidence on that behalf and thus dismissed the appeal accordingly.

Conclusion

After going through the above-mentioned points, we can conclude that Section 145 of the Act of 1881 allows only the complainants to tender their evidence through an affidavit in any criminal proceeding under the Criminal Procedure Code (now Bharatiya Nagarik Suraksha Sanhita, 2023).  The same was clarified in notable cases like Mandvi Co-operative Bank Ltd. vs. Manish B. Thakore (2010), Rajni Dhingra and Sanjeev Chug (2019), and Jabalpur Bus Association & Ors vs. State of M.P. & Anr. (2002). In all these cases the Court held that the statutory language clearly mentions the word “complainant” and hence the judiciary cannot consider the same as unintentional and fill any gap left by the legislature by including “the term accused” in the purview of Section 145 (1).

Now with regards to summoning any person who has adduced their evidence through an affidavit, under a proceeding under the Act of 1881, the court is under a mandate to summon such witness if an application is made either by the complainant or accused on this behalf. So clearly speaking the court is vested with both the discretionary as well as mandatory actions under Section 145 of the Act of 1881.

Frequently Asked Questions (FAQ)?

Can an accused tender his evidence under Section 145 (1)?

Only the complainant is entitled to adduce his evidence under the above-mentioned section and the same has been clarified in several judgements like Prabhudas Panjainmal Rice and Dal Mill vs. Avon Trade Link (2010) and Indian Bank Association & Ors. vs. Union of India & Ors (2014).

Is the provision of Section 145 (1) mandatory provision?

No. It is discretionary for the court to permit such evidence by the complainant.

Who can be summoned under Section 145(2)?

Any witness who has adduced the same through an affidavit can be summoned by the court at its discretion if requested by the complainant or the accused.

References

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