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2026 Supreme(Online)(HP) 697

IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA
Sandeep Sharma, J
MAYA RAM – Appellant
Versus
NISHANT GULERIA – Respondent
Cr. Revision No.179 of 2021



Advocates:
For the Appellants/Petitioners: Mohar Singh
For the Respondents: Yudhbir Singh Thakur

Under Section 147 of the Negotiable Instruments Act, a court can compound an offense and acquit the accused even after conviction has been recorded, provided the parties reach an amicable settlement.

Headnote:The matter involves a criminal revision petition challenging the conviction of the accused under Section 138 of the Negotiable Instruments Act. The accused had issued a cheque for Rs. 4,00,000/- which was dishonoured due to insufficient funds, leading to a sentence of one month's simple imprisonment and a compensation order of Rs. 4,00,000/-. This conviction was subsequently affirmed by the Additional Sessions Judge. The court addressed whether the offense could be compounded following the recording of conviction. Relying on Section 147 of the Negotiable Instruments Act and the precedent set in Damodar S. Prabhu V. Sayed Babalal H., the court reasoned that an offense under the Act can be compounded even after conviction if the parties have reached an amicable settlement and the complainant has no objection. Consequently, the matter is ordered to be compounded, the judgments of conviction and sentence are quashed, and the accused is acquitted, subject to the payment of a 5% compounding fee to the State Legal Service Authority.

Table of Content
1. summary of the trial court's conviction and the appellate court's affirmation regarding the dishonour of a cheque under section 138 of the ni act. (Para 1 , 2 , 3 , 4)
2. the parties reached an amicable settlement and the complainant agreed to compound the offense after receiving compensation. (Para 5 , 6 , 7)
3. the court's authority to compound offenses under section 147 of the ni act even after conviction, based on supreme court guidelines. (Para 8)
4. the final order of acquittal and the imposition of a compounding fee to the state legal service authority. (Para 9 , 10)

Sandeep Sharma, J. (Oral)

Instant criminal revision petition filed under Section 397 read with Section 482 of Code of Criminal Procedure, lays challenge to judgment dated 29.06.2021 passed by learned Additional Sessions Judge, Sundernagar, District Mandi, H.P., in Criminal Appeal No. 52/2019, affirming the judgment of conviction and order of sentence dated 2i5.02.2019 passed by learned Judicial Magistrate First Class, Court No.II, Sundernagar, District Mandi, Himachal Pradesh, in criminal complaint No. 16-I/17, whereby learned Court below, while holding the petitioner-accused (hereinafter ‘accused’) guilty of having committed offence punishable under Section 138 of the Negotiable Instruments Act (for short ‘Act’) convicted and sentenced him to undergo simple imprisonment for a period of one month and pay compensation to the tune of Rs.4,00,000/- to the respondent-complainant (hereinafter ‘complainant’).

2. Precisely, the facts of the case as emerge from the record are that complainant filed a complaint under Section 138 of the Act in the competent court of law, alleging therein that accused with a view to discharge his lawful liability issued cheque amounting to Rs..4,00,000/- in favour of the complainant, however, the same was dishonoured on account of insufficient funds in the bank account of the accused. Since accused failed to make the payment good within the otime stipulated in the legal notice, complainant was compelled to in itiate proceedings under Section 138 of the Act before the competent Court of law.

3. Learned trial Court uon the basis of material adduced on record by the respective partieso, vide judgment dated 25.02.2019, held the accused guilty of having committed offence punishable under Section 138 of the Act and accordingly, convicted and sentenced him as per the description ghiven hereinabove.

4. Being aggrieved and dissatisfied with the aforesaid judgment of conviction recorded by the learned Court below, accused preferred an appeal in the court of learned Additional Sessions Judge, Sundernagar, District Mandi, H.P, which also came to be dismissed vide judgment dated 29.06.2021, as a consequence of which, judgment of conviction recorded by the learned trial Court came to be upheld. In the aforesaid background, accused has approached this Court by way of instant proceedings, seeking therein his acquittal after setting aside the judgments of conviction recorded by the courts below.

5. Before case at hand could be heard and decided on its own merit, parties have entered into compromise, whereby they have resolved to settle the dispute amicably inter se them.

6. Today during proceedings of the case, learned c.ounsel for the accused, on instructions, states before this Court that accused has paid the entire amount of compensation awarded by learned trial Court to the complainant. He states that on account of afooresaid amicable settlement arrived inter se parties, this Court, whil e exercising power under Section 147 of the Act, may proceed to compound the offence and acquit the accused from the charges frameud against him.

7. Pursuant to oroder passed by this Court, complainant has come present in person and has been duly identified by Mr. Yudhbir Singh, Advocate. He states that he, of his own volition and without any external pressure, hahs entered into compromise with the accused. He s

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