Compromise in cheque dishonour matters can justify quashing conviction and acquittal when settlement ends the dispute.

Conviction and sentence under Section 138 of the Negotiable Instruments Act, 1881 were set aside after the parties reached an amicable settlement and the complainant no longer wished to pursue the matter. The Court treated the offence as one capable of compromise, not as a heinous or serious crime excluded from the exercise of inherent powers. Applying the principles governing quashing on compromise and the statutory power of compounding under Section 147 of the Negotiable Instruments Act, 1881, the Court concluded that setting aside the conviction would secure the ends of justice and prevent abuse of process. The petitioner was acquitted.

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Issues: Whether the conviction and sentence under Section 138 of the Negotiable Instruments Act, 1881 were liable to be set aside on the basis of an amicable settlement between the parties and the consequent acquittal of the petitioner.

Analysis: The parties had settled the dispute and the complainant no longer wished to pursue the matter. The offence was treated as one amenable to settlement rather than a crime against the State. In the facts of the case, the Court found that the matter did not fall within the category of heinous or serious offences excluded from the exercise of inherent powers. Reliance was placed on the settled principles governing quashing on compromise, including the need to secure the ends of justice and prevent abuse of process, and on the statutory power to compound under Section 147 of the Negotiable Instruments Act, 1881.

Conclusion: The revision petition was allowed, the conviction and sentence were set aside, and the petitioner was acquitted of the offence under Section 138 of the Negotiable Instruments Act, 1881.

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