Cheque dishonour compounding at revision stage can be permitted on graded costs, with acquittal following valid compromise.

A cheque dishonour conviction under Section 138 of the Negotiable Instruments Act, 1881 may be compounded at the revisional stage if the compromise is voluntary and verified. The document states that, in line with the settled approach on delayed compounding, the Court applied a graded-cost principle and directed payment of costs equivalent to 3% of the cheque amount to the State Legal Services Authority. On compliance within the stipulated period, the applicant was to be released and acquitted, and the revision was disposed of on acceptance of the compromise.

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Issues: Whether the revision petition arising from a conviction under Section 138 of the Negotiable Instruments Act, 1881 could be disposed of on the basis of compromise entered into at the revision stage, and whether the applicant could be directed to pay graded costs while granting relief.

Analysis: The parties had amicably settled the dispute and the compromise was verified as voluntary. In view of the settled legal position governing delayed compounding in cheque dishonour matters, compounding at the revision stage could be permitted on payment of costs. The Court applied the graded cost principle for compounding at the revisional stage and fixed costs at 3% of the cheque amount, payable to the State Legal Services Authority. It was further directed that upon payment of costs within the stipulated period, the applicant would be released and acquitted of the charge under Section 138 of the Negotiable Instruments Act, 1881.

Conclusion: The revision was disposed of by accepting the compromise, subject to payment of costs, and the petitioner was granted relief of acquittal from the cheque dishonour conviction on compliance.

Ratio Decidendi: Compounding of an offence under Section 138 of the Negotiable Instruments Act, 1881 may be permitted at the revisional stage on payment of graded costs, and upon valid compromise the conviction can be set aside and the accused acquitted.

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