IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
Vinod S. Bhardwaj, J.
Anup Gupta – Appellant
Versus
Jai Bhagwan – Respondent
CRR-1439-2021(O&M)
Decided On : 19-04-2022
Negotiable Instruments Act - Compounding of Offence - Section 138 - 147 - Summary of Acts and Sections: The court discussed the provisions of Section 138 and 147 of the Negotiable Instruments Act, 1881, which deal with the compounding of offences related to dishonour of cheques. The court highlighted the liberal approach to exercising the powers under Section 147 and referred to various judgments, including K.M. Ibrahim Vs. K.P Mohammed & Another, to support the compounding of the offence even at the appellate stage. The court also emphasized the overriding effect of Section 147 over the provisions of the Code of Criminal Procedure, 1973, and the importance of the compensatory mechanism in such cases.
Fact of the Case:
The petitioner filed a petition against the judgment and sentence passed in a criminal complaint under Section 138 of the Negotiable Instruments Act, 1881. The petitioner had been convicted and sentenced to imprisonment and fine. Subsequently, the petitioner complied with the payment of compensation and cheque amount, and the respondent-complainant acknowledged the receipt of the entire amount.
Finding of the Court:
The court allowed the compounding of the offence under Section 138 of the Negotiable Instruments Act, set aside the judgment of the lower courts, and acquitted the petitioner of the charges. The petitioner was released from jail in accordance with the law.
Issues: The main issue was whether the offence under Section 138 of the Negotiable Instruments Act could be compounded at the appellate stage, and whether the court had the jurisdiction to allow such compounding.
Ratio Decidendi: The court held that the powers under Section 147 of the Negotiable Instruments Act could be invoked at any stage of the proceedings, including the appellate stage, and emphasized the liberal approach to exercising such powers. The court also highlighted the overriding effect of Section 147 over the provisions of the Code of Criminal Procedure, 1973, and the importance of the compensatory mechanism in such cases.
Final Decision: The petition was allowed, and the court permitted the compounding of the offence under Section 138 of the Negotiable Instruments Act, setting aside the judgment of the lower courts and acquitting the petitioner of the charges.
JUDGMENT
Vinod S. Bhardwaj, J. (Oral). - The present petition has been preferred against the judgment dated 08.01.2019 and order of sentence dated 09.01.2019 passed in Criminal Complaint No.1208 of 2018, by the Judicial Magistrate First Class, Panipat under Section 138 of the Negotiable Instruments Act, 1881, whereby the petitioner has been convicted and sentenced to undergo simple imprisonment for a period of 01 year and to pay compensation to the tune of Rs.6,80,650/- to the respondent-complainant and has further imposed a fine of Rs.5,000/- as Court fine and in default of payment of fine, to further undergo simple imprisonment for a period of one month; as well as judgment dated 16.09.2021 passed by Additional Sessions Judge, Panipat, whereby the appeal of the petitioner against the said judgment of conviction and order of sentence has been dismissed.
2. The case came up for hearing on 16.11.2021, when the counsel for the petitioner conveyed his readiness to comply with the payment of compensation as well as the cheque amount. The relevant part of the order is extracted as under:-
Learned counsel for the petitioner submits that the petitioner is ready to comply with the directions of the payment of the amount/compensation as directed by the Courts below to the complainant and the bona fide of the petitioner may be adjudged from the fact that out of Rs.6,80,650/-, the petitioner had deposited a sum of Rs,1,20,000/- at the time of filing of the appeal before the Courts below which amount has already been released in favour of the complainant and for the rest, a DD of the amount of Rs.5,55,000/- has already been prepared in the name of the complainant for his payment and therefore, the petitioner prays for compounding of the offence.
3. The matter thereafter came up for hearing on 25.11.2021, when the amount stood remitted to the respondent-complainant. The relevant part of the order is extracted as under:-
Ld. Counsel appearing for the Respondent accepts two Demand Drafts totalling to Rs.5,55,000/-, in terms of the fine/compensation awarded by the Ld. JMIC, Panipat in her Judgment dated 8th-9th January, 2019.
Ld. Counsel for the Petitioner further prays for an adjournment to seek instructions from the Petitioner regarding payment of the requisite Compounding Fees as directed by Hon'ble Apex Court in the case of 'Damodar S. Prabhu Vs. Sayed Babalal H.', 2010(5) SCC 663.
4. The petitioner thereafter also deposited the amount towards litigation expenses and Court fine as imposed.
5. On resumed hearing, counsel for the petitioner has submitted the entire amount of payment of cheque and also the expenses and penalty imposed stands deposited.
6. Sh. Surinder Singh Virk, Advocate has appeared on behalf of respondent-complainant and has acknowledged receipt of the entire amount. He has further made a statement at the Bar that respondent-complainant has no objection to the offence being compounded as payment in question has already been made.
7. It has been submitted by the learned counsel for the petitioner that he has already deposited the amount of the cheque with the respondent-complainant, hence, the case in hand be permitted to be compounded as per Section 147 of the Negotiable Instruments Act. The relevant provisions of the Act reads thus:-
147 Offences to be compoundable. -Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), every offence punishable under this Act shall be compoundable.
8. The issue regarding compounding under the Negotiable Instruments Act at the stage of appeal as well as revision has come before this court as well as before the Hon'ble Supreme Court and they have upheld that the powers under Section 147 of the Negotiable Instruments Act can be invoked at any stage of the proceedings i.e. at the stage of trial, appeal or at the revisional jurisdiction and that the courts should be liberal in exercising such powers.
9. The Hon'ble Supreme Court in the matter of K.M. Ibrahim Vs. K.P Moha
Anil Kumar Haritwal & Anr. vs. Alka Gupta & Anr. (2004) 4 SCC 366
B.C. Seshadri vs. B.N. Suryanarayana Rao 2004 (11) SCC 510 decided by a three Judge Bench
Chochin Hotels Co.(P) Ltd & Ors vs. Kairali Granites & Ors
Damodar S. Prabhu vs. Sayed Babalal H.
Damodar S. Prabhu vs. Sayed Babalal H.
G. Sivarajan vs. Little Flower Kuries & Enterprises Ltd. & Anr. (2004) 11 SCC 400
K. Gyansagar vs. Ganesh Gupta & Anr. (2005) 7 SCC 54
K. Subramanian vs. R. Rajathi represented by PAOP Kalippan
K.J.B.L. Rama Reddy vs. Annapurna Seeds & Anr. (2005) 10 SCC 632
Kaushalya Devi Massand vs. Roopkishore
Kishore Kumar vs. J.K. Corporation Ltd. (2004) 13 SCC 494
O.P. Dholakia vs. State of Haryana & Anr. (2000) 1 SCC 762
Sailesh Shyam Parsekar vs. Baban (2005) 4 SCC 162
Sayeed Ishaque Menon vs. Ansari Naseer Ahmed (2005) 12 SCC 140
Sudheer Kumar vs. Manakkandi M.K. Kunhiraman & Anr. 2008 (1) KLJ 203
Vinay Devanna Nayak vs. Ryot Sewa Sahakari Bank Ltd. (2008) 2 SCC 305
Under Section 147 of the Negotiable Instruments Act, offences are compoundable, allowing for quashing of conviction upon mutual settlement between parties.
Point of law: Dishonour of Cheque – Compounding of offence on payment
The main legal point established in the judgment is the importance of promoting compromise and securing the ends of justice, especially in cases where the accused has remitted the entire liability an....
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