Tribune News Service
Chandigarh, December 5
Additional Sessions Judge Rajeev Goyal has set aside the order of the Judicial Magistrate (First Class), Chandigarh, convicting a person under Section 138 of the Negotiable Instruments Act, 1881, and sentencing him to undergo rigorous imprisonment for a period of one year and pay a compensation to the tune of Rs68,82,796 i.e. double the amount of cheque.
Madan Lal Arora filed an appeal under Section 374 of the CrPC against the judgment of conviction and sentence dated March 13, 2020 passed by the Court of Judicial Magistrate (First Class), Chandigarh, in a criminal complaint titled Bhushan Power and Steel Limited v/s M/s Maa Vaishno Gramodyog Sansthan.
Bhushan Power and Steel Limited Complaint filed a complaint against the accused and others alleging that in discharge of their legally enforceable liability, the accused issued a cheque dated November 17, 2015 for Rs34,41,398. At the time of presentation to the bank, the cheque got dishonoured with remark “account closed”.
A legal notice was also served upon the accused calling upon them to make the payment within 15 days of receipt of the notice, but to no avail. It led the complainant to file a complaint under Section 138 of the Negotiable Instruments Act. After finding guilty, the Judicial Magistrate (First Class), Chandigarh, pronounced the sentence.
The convict later filed an appeal to compound the offence by claiming that the matter settled amicably.
The court said as per the settlement effected vide memorandum of settlement dated August 4, 2020, the entire due amount stands paid and now nothing remains due against the appellant.
The court order read: “In view of the compromise in my opinion, accepting the prayer so made will go a long way in promoting harmony between the parties. Hence, prayer to compound the offence under Section 138 of the Negotiable Instruments Act deserves to be accepted.”
The court directed the appellant to deposit a sum of Rs10,000 with the District Legal Services Authority. The court also referred the Supreme Court judgment in KM Ibrahim v/s KP Mohammad & Anr, 2009(6) and Vinay Devanne Nayak v/s Ryot Seva Sahakari Bank Limited, 2008, in which it was held that compounding in case under Section 138 of the Negotiable Instruments Act, 1881, is permissible at the appellate stage. Once compounding is permitted under Section 147, the conviction of the accused under Section 138 of the Negotiable Instruments Act, 1881, should be set aside.