CRLMP/5438/2026 of LALARAM S/O SHRI PRABHAT LAL SAINI Vs THE STATE OF RAJASTHAN on 18 August 2026

Order

18/08/2026

1. Parties are present in person and they have been duly identified by their respective counsel.

2. The present Criminal Miscellaneous Petition has been preferred under Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023 seeking compounding of the offence under Section 138 of the Negotiable Instruments Act on the basis of compromise arrived at between the petitioner and respondent No.2 and for quashing and setting aside the judgment of conviction and order of sentence dated 18.05.2022 in Criminal Case No.483/2005 passed by learned Additional Chief Metropolitan Magistrate No.9, Jaipur Metropolitan-I whereby the petitioner was convicted for offence under Section 138 of NI Act and sentenced to two years

(2 of 4) [CRLMP-5438/2026] simple imprisonment along with fine of Rs.8,00,000/-. The said judgment of conviction and order of sentence was affirmed by learned Additional Sessions Judge No.6, Jaipur Metropolitan-I, Jaipur vide judgment dated 18.01.2025 passed in Criminal Appeal No.15/2022.

3. Learned counsel for the petitioner submitted that during the pendency of the present proceedings, the parties have amicably resolved their dispute and in terms of compromise, the petitioner offered a demand draft of Rs.5,50,000/- to the complainant, which has been accepted by him in presence of his counsel towards full and final settlement. A written compromise has been executed between the parties and respondent No.2 no longer wishes to pursue the criminal proceedings against the petitioner. It is submitted that since the parties have entered into compromise and amicably settled their dispute, therefore, the conviction and sentence recorded against the petitioner may be set aside. The copy of compromise-deed is annexed with the petition as Annexure 3.

4. Learned counsel appearing for respondent No.2/complainant affirms the factum of compromise and submits that the same has been entered into between complainant and the petitioner voluntarily, without any force, coercion or undue influence. Counsel further submits that the entire settlement amount has been received by respondent No.2 and no grievance now survives against the petitioner and he has no objection in case the offence is permitted to be compounded and the petitioner is ordered to be acquitted.

(3 of 4) [CRLMP-5438/2026]

5. Heard learned counsel for the parties and perused the material available on record.

6. Section 147 of the Negotiable Instruments Act begins with a ‘non obstante clause’ and provides that every offence punishable under the Act shall be compoundable notwithstanding anything contained in the Code of Criminal Procedure, 1973 (now, BNSS, 2023). The legislative intent behind the incorporation of the said provision is to encourage settlement of commercial disputes arising out of dishonour of cheques and to facilitate compounding even after conviction, subject to the satisfaction of the Court.

7. The Hon'ble Supreme Court in the case of Damodar S. Prabhu v. Sayed Babalal H., (2010) 5 SCC 663, has recognized that offences under Section 138 of the Negotiable Instruments Act can be compounded at different stages of the proceedings and has laid down broad guidelines regarding compounding. The said principle has subsequently been reiterated and liberalized in the case of M.P. State Legal Services Authority v. Prateek Jain, (2014) 10 SCC 690, wherein the Hon'ble Supreme Court observed that the object of Section 147 is to promote settlement and that the prescribed costs may be waived or reduced in appropriate cases for reasons to be recorded. Furthermore, the Apex Court much recently in the case of Sanjabij Tari vs. Kishore S. Borcar & Anr., 2025 INSC 1158 had issued revised guidelines for compounding the offence.

8. Upon considering the fact that the dispute between the parties stands amicably settled and the complainant has received the entire settlement amount, no useful purpose would be served

(4 of 4) [CRLMP-5438/2026] by continuing the conviction of the petitioner. The compromise appears to be genuine, voluntary and lawful, therefore, this Court is of the considered opinion that the offence deserves to be compounded in exercise of powers under Section 147 of the NI Act.

9. Accordingly, the compromise is accepted and the offence under Section 138 of the Negotiable Instruments Act is permitted to be compounded.

10. However, looking to the poor financial condition of the petitioner, this Court is not inclined to impose the cost upon the petitioner.

11. Consequently, the present Cr. Misc. Petition is allowed. The judgment of conviction and order of sentence dated 18.05.2022 passed by the learned Additional Chief Metropolitan Magistrate No.9, Jaipur Metropolitan-I in Criminal Case No.483/2005, as affirmed by the judgment dated 18.01.2025 passed by learned Additional Sessions Judge No.6, Jaipur Metropolitan-I, Jaipur in Criminal Appeal No.15/2022, is hereby quashed and set aside.

12. The petitioner is acquitted of the charge under Section 138 of the Negotiable Instruments Act by virtue of compounding of the offence. Consequence to follow.

13. It is ordered that if any warrant is issued against the petitioner, the same shall be returned without executing the same.

14. Stay application and pending application(s), if any, also stand disposed of. (ANIL KUMAR UPMAN),J 206/Dushyant