Compounding of cheque dishonour cases may be allowed at any stage, with section 482 used to give effect to a genuine compromise.

Section 147 of the Negotiable Instruments Act, 1881 gives overriding effect to compounding in cheque dishonour matters at any stage, and the bar in section 320 of the Code of Criminal Procedure, 1973 does not prevent compounding under the special statute. A genuine and verified compromise may also be acted upon in a section 482 CrPC proceeding even after revision has been decided, where the High Court considers it necessary to secure the ends of justice and prevent abuse of process. On that basis, the compromise can support setting aside the conviction and sentence in a section 138 case.

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Issues: (i) Whether a subsequent compromise in a cheque dishonour case can be given effect to in a petition under section 482 of the Code of Criminal Procedure, 1973 after dismissal of revision and confirmation of conviction; (ii) Whether the offence under section 138 of the Negotiable Instruments Act, 1881 can be compounded at the revisional stage and the conviction and sentence set aside on that basis.

Issue (i): Whether a subsequent compromise in a cheque dishonour case can be given effect to in a petition under section 482 of the Code of Criminal Procedure, 1973 after dismissal of revision and confirmation of conviction.

Analysis: The compromise between the parties was verified and found genuine. The Court held that the inherent power under section 482 of the Code of Criminal Procedure, 1973 may be exercised to secure the ends of justice and prevent abuse of process, even after a revision has been decided, where special circumstances are shown. The Court also treated the subsequent settlement as a relevant circumstance justifying intervention notwithstanding the prior revisional order.

Conclusion: Yes. The subsequent compromise could be acted upon in the section 482 proceeding.

Issue (ii): Whether the offence under section 138 of the Negotiable Instruments Act, 1881 can be compounded at the revisional stage and the conviction and sentence set aside on that basis.

Analysis: The Court relied on the compensatory nature of cheque dishonour proceedings, the overriding effect of section 147 of the Negotiable Instruments Act, 1881, and the permissibility of compounding at any stage. It held that the bar in section 320 of the Code of Criminal Procedure, 1973 did not prevent compounding of an offence under the special enactment. On the settled facts and compromise, the Court found compounding justified.

Conclusion: Yes. The offence was compoundable and the conviction and sentence could be annulled.

Final Conclusion: The compromise was accepted, the conviction and sentence were set aside, the petitioner was treated as acquitted on compounding, and the petition succeeded with ancillary directions for costs and release of the deposited amount.

Ratio Decidendi: In proceedings under section 138 of the Negotiable Instruments Act, 1881, section 147 gives overriding effect to compounding at any stage, and the High Court may use section 482 of the Code of Criminal Procedure, 1973 to give effect to a genuine compromise and secure the ends of justice even after revisional dismissal.

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