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TMI Blog2024 (9) TMI 56X X X X Extracts X X X X X X X X Extracts X X X X ..... d to make consequential directions, if required. There is no bar that unless the matter is forwarded to mediation for settlement, the same cannot be entered before the Court itself. The Court only needs to be satisfied that the settlement is lawful and consent of the parties is voluntary and not obtained under coercion or undue influence - Even when the Court permits the compounding of an offence, which is permissible under NI Act, there is no bar that the Court cannot compound the offence without forwarding the matter to mediation. When the matter is not forwarded to mediation but the Court records the settlement or compounds the offence, it is obvious that the proposal receives imprimatur or authoritative approval of Court. In the facts and circumstances, there does not appear to be any reason to presume that the settlement was not voluntary or under any force, pressure or coercion. The fact that the respondent had come with a DD dated 06.11.2020, which was handed over to the petitioner/complainant on 09.11.2020 reflects that he had already made up his mind to settle the issues. Once the said settlement was accepted by the petitioner and also received imprimatur of the Court, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, in proceedings under Section 138 NI Act, respondent (who was summoned as an accused) expressed his intention to compromise the matter and offered to settle the disputes by making payment of Rs. 1.20 crore against original liability of Rs. 1.10 crore. The same was agreed by the petitioner/complainant and a statement/undertaking of the respondent was recorded vide order dated 09.11.2020 by learned MM. A DD of Rs. 5 lacs dated 06.11.2020, prepared by the respondent in the name of petitioner along with 05 post-dated cheques of different dates were also handed over by the respondent on 09.11.2020. Respondent was accordingly released on interim bail and the matter was further fixed for 17.12.2020. 3. After more than a month of settlement and part discharge of the liability towards the settlement, the respondent backed out from his statement made before the learned Trial Court as recorded vide order 17.12.2020. An application under Section 421 read with Section 431 Cr.P.C. for issuance of warrant of attachment was further dismissed by the learned Trial Court vide impugned order dated 19.12.2020. 4. Mr. Puneet Mittal, learned Senior Advocate for petitioner submits that impugned order pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a complaint case under Section 138 NI Act for amicable settlement through mediation, procedure to be followed upon settlement and the legal implications of breach of mediation settlement were considered. Observations in paras 104 to 107 may be beneficially reproduced: 104. Binding the parties to a settlement agreement entered into through a formal mediation process and being held accountable for honouring the same is really enforcing the legislative mandate in enacting Sections 138 and 147 of the NI Act i.e. to ensure an expeditious time bound remedy for recovery of the cheque amounts. Breach of a lawful entered agreement would not only frustrate the parties to the mediation, but would be opposed to the spirit, intendment and purpose of Section 138 of the NI Act and would defeat the ends of justice. The courts cannot permit use of mediation as a tool to abuse judicial process. 105. There is no legal prohibition upon a criminal court seized of such complaint, to whom a mediated settlement is reported, from adopting the above procedure. Application of the above enunciation of law to a mediation arising out of a criminal case manifests that a settlement agreement would require to be i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g on record the settlement stands empowered to make consequential directions, if required. 9. The position in regard to mediation settlement agreement in cases permissible to be forwarded under the Mediation Act, 2023 and outcome of mediation in reference to criminal cases may also be beneficially noticed. Under Section 26 of the Mediation Act, 2023, the mediation settlement agreement resulting from mediation signed by the parties and authenticated by the Mediator is final and binding between the parties and is enforceable under the provisions of Code of Civil Procedure, 1908 by virtue of Section 27 of the Mediation Act, 2023, in the same manner as if it were a judgment or a decree passed by the Court. However, the outcome of mediation in respect of compoundable offences forwarded for mediation shall not be deemed to be a judgment or a decree and shall be further considered by the Court in accordance with law for the time being in force, under second proviso to Section 6 of the Mediation Act, 2023. The reason for not deeming the outcome of such mediation in criminal case as a decree or judgment, is that criminal offences are generally considered as offences against the society and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Rs. 1.20 crore. In the facts and circumstances, there does not appear to be any reason to presume that the settlement was not voluntary or under any force, pressure or coercion. The fact that the respondent had come with a DD dated 06.11.2020, which was handed over to the petitioner/complainant on 09.11.2020 reflects that he had already made up his mind to settle the issues. Once the said settlement was accepted by the petitioner and also received imprimatur of the Court, there does not appear to be any reason for the Court to arrive at a contrary conclusion vide impugned order dated 19.12.2020 that there was no effective settlement bringing criminal proceedings to an end. The settlement was legal and voluntary without any force, pressure or coercion. The proceedings after settlement between the parties vide order dated 09.11.2020 were only for the purpose of ensuring the compliance of settlement by the parties. 13. In view of the above, this Court is of the considered opinion that once a valid settlement stood recorded, the consequences of the same are bound to ensue and as such, on default or non-compliance or breach of settlement, learned MM is bound to pass an order under Sec ..... X X X X Extracts X X X X X X X X Extracts X X X X
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