Cheque dishonour compounding can be allowed at revision stage after settlement, subject to costs and acquittal on compliance.

Section 138 cheque dishonour proceedings may be compounded even at the revision stage after the parties settle the dispute and the complainant receives the amount due. The text states that Section 147 of the Negotiable Instruments Act makes such offences compoundable at any stage, and that delayed compounding may be allowed subject to costs in line with Supreme Court guidelines. Where compounding is permitted on payment of the stipulated cost, the conviction and sentence are set aside and the accused is acquitted.

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Issues: Whether the offence under Section 138 of the Negotiable Instruments Act, 1881 could be compounded in revision after the parties had settled the dispute, and whether the conviction could be set aside on payment of compensatory costs.

Analysis: The parties placed a settlement on record and the complainant affirmed receipt of the entire amount awarded by the courts below. The decision proceeds on the settled principle that offences under Section 147 of the Negotiable Instruments Act, 1881 are compoundable at any stage of the proceedings. The Court applied the Supreme Court guidelines governing delayed compounding and noted that, where compounding is sought at the revision stage, costs may be imposed as a condition for permitting compounding.

Conclusion: The offence was permitted to be compounded on payment of 15% of the cheque amount as costs within the stipulated time, and upon such payment the conviction and sentence were to stand set aside and the petitioner was to be acquitted.

Final Conclusion: The revision was disposed of by granting conditional compounding of the cheque dishonour offence and by extending the consequential relief of acquittal on compliance with the cost condition.

Ratio Decidendi: An offence under Section 138 of the Negotiable Instruments Act, 1881 may be compounded even at the revision stage after settlement between the parties, but delayed compounding can be permitted subject to payment of costs in terms of the governing guidelines.

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