1 May 2024 8:20 AM GMT
Recently, the Supreme Court observed that once the complainant is compensated by the accused against the dishonored cheque amount, then the consent of the complainant is not mandatory for compounding of the offence under the Negotiable Instruments Act, 1881 (“NI Act”).
By placing reliance upon the Judgment of JIK Industries Limited & Ors. v. Amarlal V. Jamuni & Anr, the bench comprising Justices AS Bopanna and Sudhanshu Dhulia observed that 'consent' is not mandatory in the compounding of offences under Section 138 of the NI Act.
“even in the absence of 'consent' court can close criminal proceedings against an accused in cases of section 138 of NI Act if accused has compensated the complainant.”, the Court said while referring to the 2017 judgment of the Supreme Court in M/s Meters and Instruments Private Limited and Another vs. Kanchan Mehta
The present case relates to the compounding of cheque dishonour complaint under Section 147 of the NI Act. The complainant didn't consent to settle the matter despite the repayment of the cheque amount made by the accused to the complainant.
The trial court and High Court held in favour of the complainant, following this the accused approached the Supreme Court.
Section 147 makes the Offences under the NI Act compoundable.
“Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), every offence punishable under this Act shall be compoundable.”, says Section 147 of the NI Act
At the outset, the court observed that under Section 147 of the NI Act, it is not incumbent upon the court to mandatorily note the consent of the complainant before closing the proceedings under the NI Act.
The court referred to the JIK Industries Ltd. case, where it was held that “in view of non-obstante clause in Section 147 of the NI Act, which is a special statute, the requirement of consent of the person compounding in Section 320 of the Code is not required in the case of compounding of an offence under the NI Act.”
“All the same, in this particular given case even though the complainant has been duly compensated by the accused yet the complainant does not agree for the compounding of the offence, the courts cannot compel the complainant to give 'consent' for compounding of the matter.”, the court added.
Given the above observation, the court absolved the accused from liability under the NI Act after noting that the debt amount was already paid by the accused to the complainant.
“It is also true that mere repayment of the amount cannot mean that the appellant is absolved from the criminal liabilities under Section 138 of the NI Act. But this case has some peculiar facts as well. In the present case, the appellant has already been in jail for more than 1 year before being released on bail and has also compensated the complainant. Further, in compliance of the order dated 08.08.2023, the appellant has deposited an additional amount of Rs.10 lacs. There is no purpose now to keep the proceedings pending in appeal before the lower appellate court.”, the court observed.
Accordingly, the appeal was allowed.
Case Title: RAJ REDDY KALLEM Versus THE STATE OF HARYANA & ANR.
Citation : 2024 LiveLaw (SC) 336