HC sets aside conviction under Negotiable Instruments Act after parties settle dispute

Read Order: Robin v. Parmod Kumar and another 

 LE Correspondent

Chandigarh, August 2, 2021: The Punjab and Haryana High Court has set aside the conviction granted by a lower court under Section 138 of the Negotiable Instruments Act, 1881 after the parties settled the monetary dispute.

The accused, Robin, filed a criminal revision petition against the order dated 15.1.2020, passed by Additional Sessions Judge, Patiala upholding the conviction of the petitioner under Section 138 of the Act.

The complaint was filed after a cheque for Rs.4,88,000 issued by the petitioner to the complainant was dishonoured. As per the complaint, the cheque was issued for returning a loan taken by the petitioner.

The petitioner was convicted on 25.1.2019 by Judicial Magistrate First Class, Rajpura. Aggrieved of the conviction, an appeal was filed and the same was dismissed. Hence, the present criminal revision was filed before High Court.

During the hearing, the High Court was apprised that after dismissal of the appeal, the parties compromised the matter. The complainant received the amount and was not interested in pursuing the litigation any further.

“Learned counsel for respondent No. 1 supports the factum of compromise. She has no objection if the conviction of the petitioner is set aside. The petitioner deposited the cost in accordance with the judgment of the Supreme Court in Damodar S. Prabhu v. Sayed Babalal H.,” the High Court said.

Citing the Supreme Court order in K.M. Ibrahim v. K.P. Mohammed and another, the bench of Justice Avneesh Jhingan stated, “The golden thread in all these decisions is that once a person is allowed to compound a case as provided for under Section 147 of the Negotiable Instruments Act, the conviction under Section 138 of the said Act should also be set aside”. 

“In the case of Vinay Devanna Nayak (supra), the issue was raised and after taking note of the provisions of Section 320 Cr.P.C., this Court held that since the matter had been compromised between the parties and payments had been made in full and final settlement of the dues of the Bank, the appeal deserved to be allowed and the appellant was entitled to acquittal. Consequently, the order of conviction and sentence recorded by all the courts were set aside and the appellant was acquitted of the charge levelled against him,” the HC said.

“After hearing learned counsel for the parties and taking into consideration the fact that the parties have settled their dispute. The offence punishable under Section 138 of the Act is compounded, accordingly, the impugned judgments and orders passed by the Courts below are set aside. The complaint under Section 138 of the Act is dismissed and the petitioner is acquitted of the notice of accusation served upon him,” held the bench.