Wednesday, June 23, 2010

PeerPower : Two reasons to cheer

PeerPower : Two reasons to cheer

Moves to reduce judicial backlog
Law minister Veerappa Moily has made two excellent suggestions, both of which merit serious consideration by the government. One, to set up fast-track courts to deal with litigations relating to bouncing of cheques.
And two, for Parliament to assess the extra burden any new law it passes is likely to impose on the courts and provide for financing to tackle the additional burden, if any. Take these one by one.

Till we move to a completely electronic mode of payment, which in the Indian context is likely to be a long time from now, cheques will continue to dominate business and commercial dealings. However, cheque payments will cease to have any sanctity if there is no mode of ensuring they are honoured.

It was with this in mind that the Negotiable Instruments Act that governs cheque payments was amended to make the dishonour of cheques a cognisable offence.
While the objective was undoubtedly good, given the huge pile up of cases in our courts (30 million at the last count) and long delays in the Indian legal system, the outcome has not been an entirely happy one.

As of now, there are about 38 lakh cases pending before courts over dishonoured cheques, not only defeating the very purpose for which the amendment was envisaged, but also adding to the backlog of pending cases.
The law minister's suggestion of fast-track courts to deal specifically with such cases should thus go a long way to address both these problems.

An impact assessment of the likely cost of implementing any new legislation will help the government factor in the additional burden on the legal system of any new law.
If the added pressure on an already-overburdened legal system is far in excess of the benefit sought to be derived from the new laws, the government might want to rethink the law.

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