2017 (3) TMI 336 - HC - Indian Laws

Complaint case under Section 138 NI Act - effect of settlement - Held that - Once the parties have settled their disputes and have arrived a settlement, the same should be given effect in entirety and should be treated as a solemn settlement. Mr. Rakesh Kapoor who is present in Court, states that he cannot return back the money. Thus the respondent No.2 having taken the benefit of the settlement, the other terms of the settlement, arrived at between the parties, are also required to be complied with. Since one of the terms of the settlement arrived at between the parties i.e. clause 7 notes that there was no criminal or civil cases instituted by Rakesh Kapoor pending before any Court and if any such case is brought to the notice of Rakesh Kapoor, the same shall be withdrawn by making an appropriate application before the concerned court and that on the same set of allegations for which the above noted FIR was registered and a complaint case under Section 138 NI Act is filed, the charge sheet has been filed, the same is liable to be quashed in view of the settlement arrived at between the parties and the respondent No.2 having taken the benefit of the settlement. Consequently, FIR No. 1111/1998 under Sections 420/467/468/471 IPC registered at PS Kalkaji, Delhi and the proceedings pursuant thereto are hereby quashed.

Summary

Issues:
Quashing of FIR under Sections 420/467/468/471 IPC based on settlement between parties.

Analysis:
1. Background and Settlement Agreement: The petitioners sought quashing of FIR No. 1111/1998 under Sections 420/467/468/471 IPC, citing a settlement between the parties. The respondent, Rakesh Kapoor, had filed a complaint under Section 138 of the Negotiable Instruments Act, leading to a conviction of petitioner No.1, S.N. Bansal. After various legal proceedings, the parties entered into a settlement, as evidenced by a joint memo of compromise filed before the Supreme Court.

2. Contents of Settlement Agreement: The joint memo of compromise detailed the agreement between Rakesh Kapoor and S.N. Bansal, where Bansal paid a sum and issued a post-dated cheque to Kapoor for settlement of all claims. Kapoor acknowledged receiving the amount and the cheque, expressing willingness to compound the offence for which Bansal was convicted. The settlement also included provisions for withdrawal of any pending cases by Kapoor and a commitment from Bansal to honor the post-dated cheque.

3. Allegations of Duress: Kapoor, while acknowledging the settlement, claimed it was made under duress due to financial constraints. However, he admitted that the settlement was not under duress from the petitioners or the Court but due to his personal circumstances. Despite being asked, Kapoor stated he could not refund the settlement amount, indicating his acceptance of the settlement terms.

4. Legal Precedents: The judgment referred to legal precedents emphasizing the sanctity of settlements reached through mediation. It highlighted that once parties agree to a settlement, they should adhere to it, and withdrawal on trivial grounds is impermissible. The court cited cases where settlements were upheld even if one party opposed it, stressing the importance of honoring settlement agreements.

5. Court's Decision: Considering the settlement between the parties and Kapoor's benefit from it, the Court quashed the FIR and related proceedings under Sections 420/467/468/471 IPC. The judgment emphasized the need for compliance with all terms of the settlement, including withdrawal of pending cases as per the agreement.

6. Conclusion: The Court's decision to quash the FIR was based on the settlement agreement between the parties, highlighting the significance of honoring settlements reached through mutual consent. The judgment underscored the importance of upholding settlement terms and refraining from withdrawing from agreements once made, in line with legal principles and precedents supporting the enforcement of mediated settlements.