2019 (5) TMI 1940 - HC - Indian Laws

Dishonor of Cheque - compounding of offences - requirement of consent of both the parties - HELD THAT - This question is no longer res integra in view of the judgment rendered by the Hon ble Supreme Court in M/s. Meters and Instruments Private Limited and another versus Kanchan Mehta, 2017 (10) TMI 218 - SUPREME COURT wherein after taking into consideration the entire law on the subject, the Hon ble Supreme Court specifically held that even though compounding requires consent of both parties, however, in absence of such consent, the Court, in interests of justice, on being satisfied that the complainant has been duly compensated, can in its discretion close the proceedings and discharge the accused. The petitioner is acquitted of the offence punishable under Section 138 of the Negotiable Instruments Act - the amount of Rs.36,000/- lying in deposit before the learned trial Court is ordered to be released in favour of respondent No.1 on his furnishing his bank account before the concerned Court - revision petition allowed.

Summary

Issues: Compounding of case in absence of complainant

Analysis:
The petitioner presented an affidavit from respondent No.1 acknowledging receipt of the compensation amount, seeking to compound the case based on recent Supreme Court judgments. The court considered whether compounding could proceed in the complainant's absence. Referring to a Supreme Court ruling in M/s. Meters and Instruments Private Limited v. Kanchan Mehta, the court noted compounding requires both parties' consent but can be done in the absence of consent if the complainant is compensated adequately. The court highlighted that the offense under Section 138 of the Negotiable Instruments Act is primarily civil, and compounding emphasizes compensation over punishment.

The court emphasized the need for summary trial procedures under Chapter XVII of the Act, stating that compounding should be encouraged at the initial stage and can be considered later if appropriate compensation is provided. The judgment clarified that even without both parties' consent, the court, in the interest of justice, can close proceedings if the complainant is satisfied with compensation. The court also discussed the magistrate's discretion in deciding whether to try a case summarily based on the potential sentence length and the need for suitable compensation.

Considering the principles laid down in various Supreme Court judgments, including Bhangu Trading Co., N.P. Murugesan, and Kanchan Mehta cases, the court decided to grant relief to the petitioner and acquitted them of the offense under Section 138 of the Negotiable Instruments Act. The court ordered the release of the deposited amount to respondent No.1 and allowed them to seek further redress if aggrieved. The judgment highlighted the importance of ensuring complete justice by bringing the litigation to a close in such circumstances.