2025 (1) TMI 1 - HC - Indian Laws

Dishonour of Cheque - compounding of offence after the judgment of conviction and order of sentence have been passed - petitioner compromised the matter with the respondent (complainant) - HELD THAT - Having taken note of the fact that the petitioner - accused and the complainant-respondent have settled the matter and the complainant has no objection in compounding the offence, therefore, this Court sees no impediment in accepting the prayer made on behalf of the accusedpetitioner for compounding of offence while exercising power under Section 147 of the Act as well as in terms of guidelines issued by the Hon ble Apex Court in Damodar S. Prabhu V. Sayed Babalal H. 2010 (5) TMI 380 - SUPREME COURT , wherein the Hon ble Apex Court has held ' since Section 147 was inserted by way of an amendment to a special law, the same will override the effect of Section 320(9) of the CrPC, especially keeping in mind that Section 147 carries a non obstante clause.' In K. Subramanian Vs. R. Rajathi 2009 (11) TMI 1013 - SUPREME COURT , it has been held by the Hon ble Apex Court that in view of the provisions contained in Section 147 of the Act read with Section 320 of Cr.P.C., compromise arrived at can be accepted even after recording of the judgment of conviction. Since, in the instant case, the petitioner-accused after being convicted under Section 138 of the Act, has compromised the matter with the complainant, prayer for compounding the offence can be accepted in terms of the aforesaid judgments passed by the Hon ble Apex Court. Conclusion - In view of the compromise arrived at between the parties, the petitioner should be permitted to compound the offence committed by him under Section 138 of the Code. The present matter is ordered to be compounded and the impugned judgment of conviction and order of sentence passed by learned Chief Judicial Magistrate, Shimla, District Shimla, H.P, which was affirmed in appeal by learned Additional Sessions Judge (CBI Court), Shimla, District Shimla, H.P., are quashed and set-aside and the petitioner-accused is acquitted of the charge framed against him under Section 138 of the Act - Undisputedly, the total amount of the cheques is Rs.15,000/-, however, the learned counsel for the petitioner submitted that the petitioner is a poor person and the imposition of compounding fee may be reduced. Petition disposed off.

1. ISSUES PRESENTED and CONSIDERED

The core legal questions considered in this judgment are:

Whether the petitioner-accused is entitled to relief under Section 438 read with Section 442 of the Bharatiya Nagarik Suraksha Sanhita, 2023, against the judgment of conviction and order of sentence passed by the lower courts.
Whether the offence under Section 138 of the Negotiable Instruments Act, 1881, can be compounded after the judgment of conviction and order of sentence have been passed.
Whether the compounding fee imposed on the petitioner can be reduced considering his financial condition.

2. ISSUE-WISE DETAILED ANALYSIS

Issue 1: Relief under Section 438 read with Section 442 of BNSS

Relevant Legal Framework and Precedents: The petitioner sought relief under Section 438 read with Section 442 of the Bharatiya Nagarik Suraksha Sanhita, 2023, challenging the affirmations of his conviction and sentence by the lower courts.
Court's Interpretation and Reasoning: The court considered the petitioner's application for compounding the offence and the subsequent compromise reached between the parties.
Key Evidence and Findings: The petitioner and the complainant reached a compromise, and the petitioner paid the entire compensation amount to the complainant.
Application of Law to Facts: The court applied Section 147 of the Negotiable Instruments Act, 1881, which allows for the compounding of offences, and considered the guidelines issued by the Apex Court in relevant cases.
Treatment of Competing Arguments: The court noted the absence of any objection from the complainant to the compounding of the offence.
Conclusions: The court allowed the compounding of the offence and set aside the conviction and sentence, acquitting the petitioner.

Issue 2: Compounding of Offence under Section 138 of the Act

Relevant Legal Framework and Precedents: Section 147 of the Negotiable Instruments Act, 1881, permits the compounding of offences under the Act. The court referenced the Apex Court's decisions in Damodar S. Prabhu v. Sayed Babalal H. and K. Subramanian v. R. Rajathi, which support the compounding of offences even post-conviction.
Court's Interpretation and Reasoning: The court emphasized the non-obstante clause in Section 147, which overrides the general rule in Section 320(9) of the CrPC, allowing for the compounding of offences under the Negotiable Instruments Act.
Key Evidence and Findings: The affidavits from both parties confirmed the settlement and the complainant's willingness to compound the offence.
Application of Law to Facts: The court applied the legal principles from the cited precedents to accept the compounding application.
Treatment of Competing Arguments: The court found no legal impediment to compounding the offence given the mutual agreement between the parties.
Conclusions: The court ordered the compounding of the offence, quashing the conviction and sentence.

Issue 3: Reduction of Compounding Fee

Relevant Legal Framework and Precedents: The guidelines from the Apex Court in K. Subramanian v. R. Rajathi allow for the reduction of compounding fees based on specific case circumstances.
Court's Interpretation and Reasoning: The court considered the petitioner's financial condition and the guidelines for imposing compounding fees.
Key Evidence and Findings: The petitioner demonstrated financial hardship, which the court took into account.
Application of Law to Facts: The court decided to impose a reduced compounding fee of 10% of the compensation amount.
Conclusions: The petitioner was directed to pay a reduced compounding fee of Rs. 1600 to the H.P. State Legal Services Authority.

3. SIGNIFICANT HOLDINGS

Preserve Verbatim Quotes of Crucial Legal Reasoning: "In view of the compromise arrived at between the parties, the petitioner should be permitted to compound the offence committed by him under Section 138 of the Code."
Core Principles Established: The judgment reinforces the principle that offences under the Negotiable Instruments Act can be compounded post-conviction, provided both parties agree, and highlights the court's discretion in reducing compounding fees based on financial circumstances.
Final Determinations on Each Issue: The court allowed the compounding of the offence, set aside the conviction and sentence, and acquitted the petitioner. It also reduced the compounding fee in light of the petitioner's financial condition.

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