Compounding under the Negotiable Instruments Act may be allowed after conviction when parties settle and compensation is received.

Compounding of an offence under Section 138 of the Negotiable Instruments Act, 1881 may be permitted even after conviction, where the parties have settled the dispute and the complainant has acknowledged receipt of the full compensation amount. The text notes that Section 147 supports compounding at a later stage and that a revisional judgment may be recalled to give effect to the compromise. On that basis, the conviction and sentence were set aside and the petitioner was acquitted.

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Issues: Whether an offence under Section 138 of the Negotiable Instruments Act, 1881 can be compounded after conviction has been upheld and the revisional judgment has been recalled on the basis of compromise.

Analysis: The compromise between the parties was placed on record and the complainant acknowledged receipt of the entire compensation amount. The Court relied on Section 147 of the Negotiable Instruments Act, 1881 and the settled principle that compounding is permissible at a subsequent stage, including after conviction, when the parties have settled the dispute. It further accepted that the earlier revisional judgment could be recalled for the purpose of giving effect to the compromise.

Conclusion: The offence was permitted to be compounded and the conviction and sentence were set aside, resulting in acquittal of the petitioner.

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