Court can quash conviction under Section 138 NI Act on compromise in private disputes using inherent powers.

ORDER

This Criminal Revision Case has been filed, assailing the judgment in Crl.A.No.186 of 2017 on the file of the learned Additional Sessions Court (Fast Track), Nagercoil, dated 10.02.2023, confirming the judgment dated 14.12.2017 in S.T.C.No.1253 of 2015 on the file of the learned Judicial Magistrate, Boothapandi and acquit the accused.

2. The case of the respondent/complainant is that the petitioner borrowed a loan of Rs.5,00,000/- from the respondent on 05.08.2015 and he had issued a cheque, dated 03.10.2015 for an amount of Rs.5,00,000/-. When the respondent has presented the cheque for collection on 05.10.2015, the same was returned with reason “Insufficient fund” on 07.10.2015. Hence, the respondent has sent legal notice on 20.10.2015 to the petitioner demanding repayment of the amount covered by the cheque and on receipt of the said notice, on 28.10.2015, the petitioner gave a false reply. Therefore, the respondent has filed a private complaint for the offence under Section 138 of Negotiable Instruments Act, 1881 against the petitioner.

3. The complaint was taken on file by the learned Judicial Magistrate, Boothapandi , as S.T.C.No.1253 of 2015. The learned Trial Court convicted the petitioner on 14.12.2017, for the offence under Section 138 of Negotiable Instruments Act, 1881 and sentenced him to undergo simple imprisonment for six months and to pay the cheque amount of Rs.5,00,000/- as compensation to the respondent herein, in default, to undergo further simple imprisonment for a period of three months. Challenging the above said conviction and sentence, the petitioner has filed an appeal in Crl.A.No.186 of 2017 on the file of the Additional Sessions Court (Fast Track), Nagercoil and the Additional Sessions Court (Fast Track), Nagercoil, by confirming the conviction and sentence, dismissed the appeal. Being dissatisfied with the dismissal of the appeal, the petitioner has preferred the present Criminal Revision Case.

4. The matter was referred to the National Lok Adalat before the High Court Legal Services Committee, Madurai and came before the National Lok Adalat on 14.03.2026 and the same has been settled wherein the revision petitioner had paid an amount of Rs.5,00,000/- to the respondent. The scanned copy of the award of the National Lok Adalat is as follows:-

5. Heard both sides and carefully perused the materials available on record.

6. The Hon'ble Supreme Court in Ramgopal and another v. State of Madhya Pradesh¹, had held that this Court, in exercise of inherent powers, can accept the compromise, even in the case of non- compoundable offences, if the parties have entered into a compromise and the dispute is private in nature.

7. Though the petitioner is the accused of the offence under Section 138 of Negotiable Instruments Act, the dispute is private in nature. Hence, this Court is inclined to accept the compromise and set aside the order of conviction and sentence imposed by the Courts below.

8. Accordingly, the award of National Lok Adalat dated

14.03.2026, is taken on file. The Criminal Revision Case is allowed. The conviction and sentence imposed upon the petitioner vide judgment dated 10.02.2023 in Crl.A.No.186 of 2017 on the file of the Additional

1 (2022) 14 SCC 531 Sessions Court (Fast Track), Nagercoil, confirming the judgment in S.T.C.No.1253 of 2015 on the file of Judicial Magistrate, Boothapandi, dated 14.12.2017, is set aside and the petitioner is acquitted of the offence under Section 138 of Negotiable Instruments Act.

08.04.2026 NCC : Yes / No Index : Yes / No Internet : Yes / No gbg gbg To

1.The Additional Sessions Court (Fast Track), Nagercoil.

2.The Judicial Magistrate, Boothapandi.