Honble SINHA, J – The parties hereto were partners. The partnership business ran into rough weather. Appellant intended to initiate some criminal proceedings against the respondent. Allegedly, the bank account was to be operated jointly. Respondent alone as a partner, thus, could not have taken out any money from the bank. However, allegedly, he did so. According to the respondent, a compromise was entered into by and between the parties in a police station on the following terms:

"1) Both the firms accounts right from inception till date shall be finalized and the share of profits determined by an independent auditor, Mr. R. Kasi Viswanathan. His determination shall be final and binding on both the parties.

2) The above scrutiny and finalization shall be completed before 31.1.1996. Until such time, we shall not raise any dispute against each other.

3) Till such finalization, Mr. Shankar shall handover a cheque (cheque No. 551661 dated 31.1.96) for Rs. 7 lakhs to Mr. Suresh Kumar as security deposit.

4) If the share of profits for Mr. Suresh Kumar is more than 7 lakhs, he shall encash the cheque and shall also receive the balance amount from Shankar forthwith. If the share of profits is less than 7 lacs, Suresh Kumar shall return the said cheque and Shankar shall pay Suresh Kumar a draft for the amount of profits determined. If any profit is due to Shankar, Suresh Kumar shall pay the same to Shankar forthwith."

(2). Pursuant thereto or in furtherance thereof, the respondent allegedly handed over a post dated cheque for a sum of Rs. 7,00,000/- to the appellant. As the said cheque was dishonoured on presentation, a complaint petition was filed by the appellant inter alia alleging:

"3. Further the accounts in the Bank are joint accounts and the cheques can be drawn only by both of partners on any account and not by one partner.

4. The Complainant submits that the accused has taken some amounts from the Bank and the bills also encashed by him for his own gain without concern of complainant. Therefore the accused has agreed to pay the profits sharing of a sum of Rs. 12 lacs towards the complainant. But he agreed to pay advance share of profit which he owes to the complainant till appropriate audit and accounting is made, the accused has given a sum of Rs. 7 lacs by cheque No. 551661 dated 31.1.1996 drawn of Syndicate Bank, Kodambakkam Branch as assured. The accused is to settle the entire due towards the complainant before 31.1.1996.

5. The complainant submits that the accused has not informed the complainant anything about the stop payment or requesting not to present the cheque. Therefore, in good faith the complainant has presented the cheque on 31.1.1996 through his Bankers Syndicate Bank, Kodambakkam Branch through his S.B. Account No. 10521. And the complainant has received an intimation from the Bankers that the payment stopped by the drawer and thus the cheque is dishonoured. The complainant has also verified whether the accused has sufficient funds in the Bank account on 31.1.96 but to his shock found that the accused was not having sufficient funds to honour the cheque on 31.1.96. Therefore the complainant has issued a lawyers notice dt. 3.2.1996 to the accused stating that the dishonouring of the cheque and the accused caused complainant mental agony and demanded the cheque amount to be paid to the complainant within 15 days from the date of receipt of the notice. The accused has received the notice on 6.2.1996 but he has preferred no reply to the notice even after 15 days and he has not paid the cheque amount till date."

(3). The learned Trial Judge, however, found the said defence of the respondent to be not acceptable. The learned Magistrate by a judgment and order dated 12.10.1998 imposed a fine of Rs. 7,05,000/- and directed that if the respondent fails to remit, he will undergo three months simple imprisonment. Out of the said amount, he was directed to pay a sum of Rs. 7,00,000/- by way of compensation and the remaining su

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