HC Explains: Scope of Sec.147 of NI Act, all Offences are Compoundable,

 The Karnataka High Court has held that Section 147 of the N.I. Act make every offence punishable under the Act as compoundable. 

 

The single-judge bench of Justice H.B. Prabhakara Sastry while adjudicating upon a present joint application seeking setting aside of conviction under Section 138 NI Act stated that there is no bar for the parties in the proceeding to compound the offence.

In the memorandum of settlement filed along with the interlocutory applications in all the four matters, both parties have carved out the terms of settlement entered into between them including the acquittal of the accused.

 The Court after noting that that both the parties have, with their free consent and out of their own volition, without being influenced by undue influence, duress or misrepresentation or by mistake, have entered into the terms of settlement in their best interest, stated that there is no embargo to deny them the permission to settle the matter.

It remarked that Section 147 of the N.I. Act has made every offence punishable under the N.I. Act as compoundable an as there is no bar for the parties in the proceeding to compound the offence but at the same time, as per the guidelines laid down by Apex Court in Damodar S.Prabhu Vs. Sayed Babalal H., 2010 Latest Caselaw 332 SC regarding imposing graded cost on litigant should be followed.

 

As per the ruling if the application for compounding is made before the Sessions Court or High Court in revision or appeal, such compounding is permitted to be allowed on the common condition that the accused pays 15% of the cheque amount by way of cost.

The Court accordingly passed the order in the present application after allowing the same.

 

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(With input from news agency language)

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