CRL.REV.P.(NI)/315/2026 of SARITA Vs NARESH SHARMA on 28 September 2026

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28.09.2026

1. This petition under Sections 438 and 442 of the Bharatiya Nagarik Suraksha Sanhita, 2023 impugns the judgment dated 11th August, 2026 passed by ASJ-03, North-East District, Karkardooma Courts, Delhi in Criminal Appeal No. 18/2026, titled Sarita v Naresh Sharma, whereby the appeal preferred by the Petitioner against her conviction under Section 138 of the Negotiable Instruments Act, 18811 was dismissed.

2. The aforesaid appeal was preferred by the Petitioner against the judgment of conviction dated 19th December, 2025 and order on sentence dated 20th December, 2025, passed by the JMFC, North-East District, Karkardooma Courts, Delhi in CC NI Act No. 808/2023, whereby she was convicted and directed to pay a sum of ₹3,70,000/- as compensation to the Respondent, with one month’s simple imprisonment in default.

3. On 21st August, 2026, this Court passed the following order in the present petition: “CRL.REV.P.(N) 315/2026 & CRL.M.(BAIL) 1743/2026 (for suspension of sentence)

1. By way of the present revision petition, the petitioner assails a judgment of the Sessions Court dated 11.08.2026, which has dismissed her appeal against a judgment of conviction dated 19.12.2025, and an order on sentence dated 20.12.2025, passed by the Magistrate’s Court.

2. The Magistrate’s Court convicted the petitioner under Section 138 of the Negotiable Instruments Act, 1881, and directed her to pay a fine of Rs. 3,70,000/- as compensation to the complainant – respondent, within a period of 90 days. It was further directed that, in default of payment of fine, the petitioner shall undergo simple imprisonment for one month.

3. The petitioner also assails an order dated 11.08.2026, by which the Sessions Court has directed her to surrender within one week to serve her sentence.

4. Issue notice. Notice be served upon the respondent by all permissible modes, additionally through counsel appearing on her behalf before the Trial Court.

5. Mr. Kunwar Mahendra Singh, learned counsel for the petitioner, submits that the petitioner was not granted an opportunity to cross examine the respondent.

6. However, Mr. Singh submits that the petitioner wishes to settle the entire dispute with the respondent. To show her bonafides, the petitioner will deposit the entire cheque amount of Rs. 3,00,000/- before the Trial Court on the next date of hearing, i.e. 23.09.2026.

7. List on 28.09.2026. ”

4. Ms. Jyoti Babbar, counsel for the Petitioner, states that the parties have settled the matter and that the entire cheque amount has been paid to the Respondent/complainant.

5. The Respondent stands served and is represented by Mr. Ashish Shukla, counsel. Mr. Shukla, on instructions, confirms that the parties have 1 “NI Act”

settled the matter, that the entire cheque amount has been received by the Respondent and that the Respondent has no objection to the compounding of the offence. The statement is taken on record.

6. The legal position relating to compounding of offences under Section 138 of the NI Act is now well-settled. Section 147 of the NI Act makes offences under Section 138 compoundable, notwithstanding any provisions to the contrary in Cr.P.C. The Supreme Court has consistently held that such compounding can be permitted at any stage of the proceedings, including after conviction.2 The continuation of criminal proceedings after the grievance of the Respondent has been addressed would serve no meaningful purpose.

7. In Damodar S. Prabhu, the Supreme Court laid down guidelines for imposing costs while allowing compounding at various stages, with the aim of discouraging delayed settlements and preventing misuse of the process. Subsequently, in its recent decision in Sanjabji Tari v. Kishore S. Borcar & Anr.3, taking note of the substantial pendency of cheque dishonour cases across the country and the decline in prevailing interest rates, the Supreme Court modified the earlier guidelines in Damodar S. Prabhu regarding the quantum of costs to be imposed at the stage of compounding.

8. In the present case, the cheque amount is ₹3,00,000/-. Ordinarily, costs equivalent to 7.5% of the cheque amount are payable at the time of compounding. However, the Court is vested with the discretion to reduce the costs, depending on the specific circumstances of the case. In the present case, the Petitioner has, inter alia, pleaded that she is a homemaker with 2 Damodar S. Prabhu v. Sayed Babalal H. (2010) 5 SCC 663; K.M. Ibrahim v. K.P. Mohammed (2010) 1 SCC 798; O.P. Dholakia v. State of Haryana (2000) 1 SCC 762.

three children and has limited financial means. Having regard to these circumstances, coupled with the fact that the parties have voluntarily agreed to settle the dispute and that the entire cheque amount has been paid to the Respondent, this Court considers it appropriate to reduce the costs and permit compounding of the offence upon payment of ₹5,000/- as costs, to be deposited with the Delhi Police Welfare Fund.

9. Accordingly, the present petition is allowed, and the offence under Section 138 of the NI Act is compounded.

10. Consequently, the conviction of the Petitioner under Section 138 of the NI Act stands set aside on account of compounding of the offence. The order on sentence dated 20th December, 2025 also stands set aside.

11. The petition is disposed of, along with pending application.

SANJEEV NARULA, J SEPTEMBER 28, 2026/ab

3 2025 SCC OnLine SC 2069