2020 (3) TMI 1403 - HC - Indian Laws

Dishonor of cheque - compounding of the offence under Section 138 of the Negotiable Instruments Act - HELD THAT - Taking into consideration the judgment of the Hon ble Apex Court in Kanchan Mehta s case 2017 (10) TMI 218 - SUPREME COURT , it is opined that once the petitioner has deposited the entire cheque amount along with interst @ 10% as directed by this Court vide order dated 6.8.2012, no purpose would be served by keeping the matter pending. Even though the respondent/complainant has shown his resistance against accepting the cheque amount, yet the very object of the proceedings under the Act, is to secure the payment of the amount to the complainant and not to increase the arrears of the Courts, simply for the reason that the respondent/complainant does not give his consent. The object is primarily compensatory, punitive element being mainly with the object of enforcing the compensatory element, as may be found acceptable to the parties or the Court. The present revision petition is allowed.

Summary

Issues:
Challenge to order dismissing application for compounding offence under Section 138 of the Negotiable Instruments Act without consent of complainant.

Analysis:
The revision petition challenged the order dismissing the petitioner's application to pay the complainant the cheque amount and discharge the liability without the consent of the complainant. The trial court observed that compounding of the offence under Section 138 of the Act cannot be allowed without the complainant's consent. The petitioner had already deposited the cheque amount with interest as directed by the High Court, arguing that the payment fulfilled the object of Section 138 of the Act.

The petitioner cited the judgment in M/s Meters and Instruments Pvt. Ltd. and another Vs. Kanchan Mehta, where the Supreme Court held that compounding of the offence under Section 138 can be allowed even without the complainant's consent if the complainant has been duly compensated. The Court emphasized the compensatory nature of the provision and the need to enforce the compensatory element. The Court highlighted that the trial of cases under Chapter XVII of the Act should normally follow a summary procedure.

The Judicial Magistrate confirmed the petitioner's compliance with the High Court's order to deposit the cheque amount with interest. Despite the complainant's resistance to accepting the payment, the Court emphasized the objective of securing payment to the complainant and avoiding unnecessary prolongation of proceedings. The Court referred to the Supreme Court's ruling in Kanchan Mehta's case to support the decision to close the proceedings once the entire cheque amount had been paid.

Consequently, the High Court allowed the revision petition, setting aside the trial court's order and directing the trial court to proceed in accordance with the law laid down by the Supreme Court in Kanchan Mehta's case, emphasizing the need for an expeditious decision in the matter.