Compounding of cheque dishonour offence after conviction was permitted on full settlement and payment of compensation.

An offence under Section 138 of the Negotiable Instruments Act may be compounded even after conviction where the parties have fully settled the dispute and the compensation has been paid. The High Court may then invoke inherent powers to secure the ends of justice and prevent abuse of process. As the complainant had received the entire compensation and raised no objection, the basis for continuing the conviction and sentence no longer survived, and the conviction and sentence were quashed.

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Issues: Whether the offence under Section 138 of the Negotiable Instruments Act could be compounded after conviction on the basis of compromise, and whether the conviction and sentence could be quashed in exercise of inherent powers.

Analysis: The parties placed on record a compromise under which the complainant had received the entire amount awarded as compensation and expressed no objection to compounding. The Court noted that Section 147 of the Negotiable Instruments Act permits compounding of offences and that the inherent power under Section 482 of the Code of Criminal Procedure may be exercised to secure the ends of justice and prevent abuse of process. Since the dispute had been fully settled and the compensation stood paid, the basis for sustaining the conviction and sentence no longer survived.

Conclusion: The offence was held compoundable and the prayer to quash the conviction and sentence was accepted.

Final Conclusion: The compromise between the parties was given effect to, resulting in quashing of the conviction and sentence and the petitioner's acquittal.

Ratio Decidendi: An offence under Section 138 of the Negotiable Instruments Act may be compounded even after conviction where the parties have fully settled the dispute and the compensation has been paid, and the High Court may exercise inherent powers to set aside the conviction and sentence to secure the ends of justice.

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