Case Law
Subject : Criminal Law - Negotiable Instruments Law
Chandigarh:
The High Court of Punjab and Haryana, in a significant ruling, has set aside the conviction and sentence of a petitioner in a cheque dishonour case under Section 138 of the Negotiable Instruments Act, 1881. Justice
The judgment was delivered on March 8, 2024, in the criminal revision petition (CRR 2154 / 2019) filed by
The case originated when
The Judicial Magistrate Ist Class, Rupnagar, convicted
During the pendency of the revision petition before the High Court, the parties entered into a compromise. The counsel for
The counsel for the respondent-complainant acknowledged the compromise and stated that the complainant had no objection if the offence was compounded and the petitioner was acquitted.
The High Court's decision hinged on the provisions for compounding offences under the Negotiable Instruments Act and the Code of Criminal Procedure (Cr.P.C.). The court referred to Section 147 of the NI Act , which states: > "Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), every offence punishable under this Act shall be compoundable."
The judgment also highlighted Section 320 of the Cr.P.C. , particularly sub-section (6), which empowers a High Court, exercising its revisional jurisdiction under Section 401 Cr.P.C., to allow compounding of offences.
The court cited precedents including M/s Meters and Instruments Private Limited & Anr. Vs. Kanchan Mehta (2018(1) SCC 560) and its own decision in M/s KLG Systel Ltd. vs. Bala Ji Electronics and Anr. (CRR-6767/2019, decided on 16.04.2022), which affirmed that once a settlement is effected, an offence under Section 138 NI Act ought to be compounded, leading to acquittal.
The court observed: > "This Court is in M/s KLG Systel Ltd. vs. Bala Ji Electronics and Anr. decided on 16.04.2022 in CRR-6767/2019 has also held that once a settlement is being effected, then in terms of Section 147 of the Negotiable Instruments Act and Section 320 Cr.P.C., the accused ought to be acquitted as the offence stands compounded."
Accepting the parties' submissions and considering the legal position, Justice
Consequently, the High Court allowed the revision petition. The judgment and order of conviction and sentence dated June 6, 2017, passed by the Judicial Magistrate Ist Class, Rupnagar, and the appellate court's judgment dated July 3, 2019, were set aside.
This judgment reaffirms the principle that offences under Section 138 of the NI Act are compoundable at any stage, including revision, especially when parties have amicably settled their dispute, thereby promoting quicker resolution and reducing the burden on courts.
#NIAct #ChequeBounce #Compounding #PunjabandHaryanaHighCourt
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