Assocham suggests special court for cheque dishonouring

By Our Special Correspondent

NEW DELHI, JUNE 9. The Associated Chambers of Commerce and Industry of India (ASSOCHAM) has suggested the establishment of a special court and amendment to the Negotiable Instruments Act to minimise litigation arising out of dishonouring of cheques.

In a representation to the Minister of Law, Justice and Company Affairs, the chamber says that over Rs. 5,000 crores has been blocked in Mumbai alone because of the lacunae in Sec. 138 of the Negotiable Instruments (NI) Act, which makes it difficult to prosecute the creditor if he dodges the law and fails to make justified payments.The Assocham has suggested that all pending cases in the court of magistrates should be transferred to the special court from the date of amendment to the Act. To cover the expenses of the special court, a small percentage of the amount involved in the dishonoured cheques should be fixed to cover expenses of special courts. The special court should have its own machinery to execute the order relating to service of notice to the witness oraccused person.

The Assocham has said the special court should have statutory powers to direct the accused to deposit the entire cheque amount and furnish the valid security to its satisfaction in respect of the amount covered under the dishonoured cheques. The time for settlement of the case should be fixed at one year from the date of filing of the complaint and any extension should be done by an Appellate Court by another six months.

It also suggests the power of the special court should be unlimited in imposing fine as a deterrent measure, since the metropolitan magistrate or magistrate has limited powers to impose fine.

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Section  : Business
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