Dishonour of cheque case settled amicably with 2% cost imposed under Section 138 NI Act

MP HC allowed revision petition involving dishonour of cheque under Section 138 NI Act after parties reached amicable settlement. Following apex court precedent in Damodar S. Prabhu case, court imposed 2% cost of cheque amount (Rs. 36,000) to be deposited with State Legal Services Authority within 15 days. Subject to cost payment, applicant to be released from jail or treated as acquitted from charges based on compromise between parties.

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Issues:
The issues involved in the judgment are exemption from surrender in a criminal revision and settlement of dispute leading to a compromise deed in a case under Section 138 of the Negotiable Instruments Act, 1881.

Exemption from Surrender:
The High Court considered an application for exemption from surrender in a criminal revision, noting that as per the rules, a revision against conviction is usually tenable only if the convicted person is in custody or has surrendered after conviction. However, the Court referred to a Supreme Court judgment allowing exemption from surrender based on the nature and circumstances of the case. In this instance, the applicant, a 63-year-old lady, did not surrender into custody, but considering her age and the settlement of the dispute with the non-applicant, the Court decided to hear the revision without the applicant surrendering into custody.

Settlement and Compromise Deed:
The revision was filed against a judgment convicting the applicant under Section 138 of the Negotiable Instruments Act, 1881, sentencing her to rigorous imprisonment and compensation. The revision was accompanied by a compromise deed indicating that both parties had settled the dispute without any coercion or undue influence. The complainant confirmed that the entire settlement amount had been received. The Court verified the compromise and noted the amicable settlement between the parties.

Applicability of Legal Guidelines:
The Court referred to legal guidelines laid down by the apex Court regarding the compounding of offences in cheque bouncing cases. These guidelines propose a graded scheme of imposing costs on parties who unduly delay compounding of the offence. The Court highlighted the importance of encouraging early compounding to save court time and emphasized the discretion of the competent court in imposing costs based on specific circumstances of each case. The Court justified the endorsement of these guidelines due to a legislative vacuum in the relevant law.

Disposition and Payment of Costs:
Considering the settlement and compromise between the parties, the Court directed the applicant to pay 2% of the cheque amount as costs to be deposited with the State Legal Services Authority within a specified period. Upon payment of costs, the applicant would be released from jail or treated as acquitted from the charges under Section 138 of the Negotiable Instruments Act. Failure to deposit the required amount would result in the applicant undergoing the original sentence and compensation as awarded by the trial Court. The complainant was permitted to withdraw any amount deposited by the petitioner before the lower Court.

Conclusion:
The Court allowed the application for exemption from surrender, accepted the settlement between the parties, endorsed legal guidelines for imposing costs in cheque bouncing cases, and directed the applicant to pay costs for final disposition of the case. The revision was disposed of based on the compromise between the parties.

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