Cheque dishonour conviction set aside after settlement, as compounding under the Negotiable Instruments Act was permitted.

Conviction for cheque dishonour under Section 138 of the Negotiable Instruments Act was set aside after the revision petitioner paid the settled amount and the complainant consented to compounding. The High Court applied the principle that such offences are predominantly compensatory in character and that Section 147 permits compounding of an offence under Section 138. On the basis of the memo of compromise and settlement, the conviction and sentence were quashed and the petitioner was acquitted.

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Issues: Whether the conviction for cheque dishonour could be set aside in view of the compromise and payment made by the revision petitioner and the complainant's consent to compound the offence.

Analysis: The revision arose from conviction under Section 138 of the Negotiable Instruments Act, which had been affirmed in appeal. During the revision, the parties filed a memo of compromise stating that the petitioner had paid the settled amount and that the complainant had received it and consented to compounding. The Court relied on the settled principle that offences of this nature are essentially compensatory in character and that Section 147 of the Negotiable Instruments Act permits compounding of an offence under Section 138.

Conclusion: The conviction and sentence imposed on the revision petitioner were set aside, and he was acquitted of the charges on the basis of compounding and settlement.

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