The court can quash convictions under the Negotiable Instruments Act when parties reach a genuine compromise, emphasizing recovery over punishment.

JUDGMENT

Mr. Anoop Chitkara, J.

The petitioner, who stands convicted and sentenced for a period of two years and to pay compensation to the tune of Rs. 35,00,000/- by the trial court, for the commission of offence punishable under Section 138 of the Negotiable Instruments Act, 1881, (NIA), after dismissal of his appeal by the Sessions Court, has come up before this Court under Section 401, Code of Criminal Procedure, (CrPC) for setting aside the judgment of conviction and order of sentence.

2. The petitioner faced criminal prosecution by the private respondent because of the dishonour of the cheque in question. Thus, the opposition of the State's counsel to this petition is formal.

3. During the course arguments on 24.5.2024, counsel for the petitioner had submitted that the matter has been settled with the complainant, which was corroborated by counsel for respondent no.2-complainant. Accordingly, this Court directed the parties to appear before the trial Court/Illaqa Magistrate/Duty Magistrate for getting their statements recorded with regard to the compromise arrived at between them and the concerned Court was asked to give its report as per the format. The parties have appeared before the concerned Court and got their statements recorded. The report of the concerned reads as follows:

4. The jurisprudence behind the Negotiable Instruments Act, 1881 is that the business transactions are to be honoured. The legislative intention is not to make people suffer incarceration only because their cheques bounced. These proceedings are to recover the cheque amount by showing teeth of a penal clause. Now, as per the above-mentioned report, the parties have settled their disputes and have compromised the matter.

5. It would be relevant to refer to the judicial precedents where based on the compromise, the convictions were set aside:

[17]. "...Even though the imposition of costs by the competent court is a matter of discretion, the scale of costs has been suggested in the interest of uniformity. The competent Court can of course reduce the costs with regard to the specific facts and circumstances of a case, while recording reasons in writing for such variance."

6. The present matter relates to an economic offence and the penal teeth are with an end object of recovery of legally enforceable debt or admitted liability.

7. In Shakuntala Sawhney v. Kaushalya Sawhney, (1979) 3 SCR 639, at P 642, Hon'ble Supreme Court observed that the finest hour of Justice arises propitiously when parties, who fell apart, bury the hatchet and weave a sense of fellowship or reunion.

8. This Court h