Compounding of offences provides an administrative alternative to prosecution, requiring application, factual report, hearing and order. Procedure sets a staged path from detection of duty evasion through investigation, issuance of show cause notice and adjudication recommendation to seek sanction for prosecution; the sanctioning authority considers a prescribed proposal and may offer the person compounding as an alternative. Compounding requires filing a specified application, obtaining an extendable factual report from the reporting authority within one month, granting a personal hearing before rejection, and issuing a compounding order within one month of the hearing.