In Brief

The Supreme Court examined the massive backlog of cheque dishonour cases under Section 138 of the Negotiable Instruments Act, with 35.16 lakh such cases pending nationally. The Court clarified that evidence of witnesses in Section 138 inquiries may be given on affidavit, not necessarily on oath. It held that Magistrates lack inherent power to recall or review summons orders, and rejected the contrary finding in Meters and Instruments. The Court directed High Courts to issue practice directions requiring reasons before converting summary trials to summons trials, and mandated inquiry when accused reside outside jurisdiction. Service of summons in one complaint of a transaction shall count as deemed service for related complaints. A Committee was constituted to consider legislative amendments and further reforms to accelerate disposal.

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