Early compounding in cheque dishonour cases may proceed without complainant consent when compensation is promptly paid.

In cheque dishonour prosecutions, compounding under the Negotiable Instruments Act may be permitted at an early stage without the complainant's consent where the accused tenders the cheque amount with reasonable interest and costs. Reconciling Supreme Court guidance with section 147, the Bombay HC treated complainant consent as important but not indispensable in every case, particularly when prompt compensation is offered and the settlement serves the provision's compensatory object. The Court also recognised that piecemeal compromise may be accepted in appropriate cases and that inherent powers can be used to prevent defeat of the statutory incentive for early compounding. The compounding application was allowed and the complaint proceedings were brought to an end.

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Issues: Whether an application to compound an offence under Section 138 of the Negotiable Instruments Act, 1881 can be allowed at an early stage without the complainant's consent when the accused tenders the cheque amount along with reasonable interest and costs, and whether the proceedings deserved to be closed in exercise of inherent powers.

Analysis: The competing Supreme Court authorities were reconciled by reading the guidelines encouraging early compounding in cheque dishonour cases with the principle that Section 147 of the Negotiable Instruments Act, 1881 does not make compounding wholly unguided. The decision treated the complainant's consent as important, but not indispensable in every case, particularly where the accused seeks compounding at the initial stage and the complainant is duly compensated. The Court held that the object of the provision is primarily compensatory, that prompt settlement should be encouraged, and that the trial court should not defeat the statutory incentive for early compounding by insisting on consent in every situation. On the facts, the applicants had offered the cheque amount, interest, and litigation costs at an early stage, and the Court also treated piecemeal compromise as permissible in appropriate cases.

Conclusion: The application for compounding was allowed, the order rejecting compounding was set aside, and the offence under Section 138 of the Negotiable Instruments Act, 1881 was directed to stand compounded on deposit of the stipulated amount.

Final Conclusion: The complaint proceedings were brought to an end on terms that secured compensation to the complainant, and the applicants were entitled to discharge upon compliance with the payment direction.

Ratio Decidendi: In a cheque dishonour prosecution, compounding may be permitted at an early stage even without the complainant's consent if the accused duly compensates the complainant and the circumstances justify exercise of the Court's inherent powers.

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