BOPA is a strong deterrent to fraud involving bad cheques as the erring party could be imprisoned and also fined

In any country, the dishonour of a cheque by a bank is a serious criminal offense punishable by imprisonment and a fine. But the Supreme Court’s recent verdict that ruled against invoking the Banking Offence and Punishment Act (BOPA) 2008 in such cases has baffled both the government and the public at large. The SC’s verdict last month on a case involving Nirmala Sodari, a resident of Kailali district, said that since the Negotiable Instruments Act (NIA) 1977 had included provisions related to dishonoured cheques, such cases should be adjudicated under NIA, not BOPA. So cheque bounce cases will no longer be a criminal case should the SC’s new precedent apply to all similar cases, where the government is the plaintiff. Under the existing provision, in the event a cheque is dishonoured for insufficiency of funds, the affected party can file an FIR at the nearest police office, which will carry out an investigation after arresting the accused.

In July last year, the Supreme Court had squashed the conviction passed against Sodari by the Dipayal High Court after two cheques worth Rs 1,885,000, issued by her to one Ganesh Kumar Rawal, were dishonoured. It ruled that when a case can be filed under both criminal and civil law, then the law that helps maintain peace in society should be invoked. It is not understandable how the SC could have passed a verdict based on NIA when it has been succeeded by BOPA. On March 12 this year, Nepal Rastra Bank, the central bank, had put up a notice calling on the people not to issue cheques if there was inadequate bank balance or face the penalty under BOPA. The notice read, not only would the accused be made to repay the principal amount, he or she would also have to pay a fine equal to it and serve a three-month prison sentence for the offense. Moreover, if a cheque is dishonoured thrice, it said, the party issuing it would not be eligible to open any bank account or be eligible to take loans.

As things stand now, the government is in a dilemma, and the Office of the Attorney General is making preparations to file a review petition against the SC’s recent verdict as it has created confusion. It is not sure if the SC verdict applies solely to Sodari’s case or to all cases involving bounced cheques. There are cases related to dishonoured cheques being investigated by the police while some cases are sub-judice in the commercial benches of the high courts. What will become of them? If civil law is to apply to cheque bounce cases, this could seriously jeopardise the banking system. BOPA is a strong deterrent to fraud involving bad cheques as the erring party could be imprisoned and also fined. That is why the affected party was able to get its money quite quickly. However, should civil law, as under NIA, be applicable, the victims will be at the receiving end as they will have to collect evidence and pursue the case till the end, which will drain the victim physically and financially. The state has the responsibility to protect the banking system, and it should take up the review petition with the SC strongly. The SC, on its part, must see to it that confusing, controversial verdicts, guided by parochial self-interests, are not given.

Rebuild the bridge

The government has now tightened the screw on Pappu Construction to have it construct the 85-metre-long Bagmati Arch Bridge at Tinkune, which violated the exact specification mentioned in the bidding documents. Kathmandu Valley Road Expansion Project recently sent a letter to the company to dismantle the foundation of the bridge and rebuild it as per the specifications. The construction company has earned a bad name as many of the bridges it has built across the country have been found to be substandard.

An investigation carried out by Pulchowk Engineering Campus on behalf of the government found that the company had to install 29 piles 20 metres beneath the surface. However, the piles had been dug only 16 metres, causing the bridge to become unstable when having to bear the loads of vehicles. This is not the first time that the company has breached the criteria set in the bidding documents. A 62-metre-long Bishnumati Bridge at Teku built by the same company has also been found to be substandard. In both the cases, the firm had bid the lowest to grab the government contract. The company should be blacklisted and fined as per the existing law for causing huge losses to the state.