Compounding of cheque dishonour offence at the revisional stage is permitted when parties settle and compromise is accepted.

Section 147 of the Negotiable Instruments Act, 1881 is an enabling compounding provision with overriding effect over the restriction in Section 320(9) of the Code of Criminal Procedure, 1973. The offence under Section 138 of the Negotiable Instruments Act can therefore be compounded at any stage of the proceedings, including after conviction and at the revisional stage, where the parties have settled their dispute and the compromise is placed before the Court. The compromise was accepted and taken on record, the conviction was set aside, and the accused were acquitted.

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Issues: Whether the offence under Section 138 of the Negotiable Instruments Act, 1881 could be compounded at the revision stage on the basis of a compromise between the parties, and whether the conviction required to be set aside consequent upon such compounding.

Analysis: Section 147 of the Negotiable Instruments Act, 1881 is an enabling provision for compounding of offences under that special statute and, by reason of its non obstante clause, overrides the restriction contained in Section 320(9) of the Code of Criminal Procedure, 1973. The offence under Section 138 of the Negotiable Instruments Act, 1881 can therefore be compounded at any stage of the proceedings, including after conviction and at the revisional stage, when the parties have settled their dispute and the compromise is placed before the Court. The compromise in the present matter was accepted and taken on record.

Conclusion: The compounding was permitted, the conviction was set aside, and the petitioners were acquitted of the offence under Section 138 of the Negotiable Instruments Act, 1881.

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