Counsel for the v. VIJAY KUMAR ARORA ANR. Through
Case Details
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Cited in this judgment
VIJAY KUMAR ARORA & ANR. Through: Mr. .....Respondents Verma, Sahil Advocate for R-1. Complainant in person. CORAM: HON’BLE MR. JUSTICE AMIT MAHAJAN AMIT MAHAJAN, J.(ORAL)
1. The present petition is filed for quashing and setting aside of the order dated 18.02.2025 (hereafter (cid:145)impugned order(cid:146)), passed by the learned Additional Sessions Judge-05 ((cid:145)ASJ(cid:146)), Dwarka Courts, New Delhi, in Criminal Appeal No. 271/2023 whereby the appeal filed by the petitioner challenging the judgment of conviction dated 20.04.2023 and order on sentence dated 28.04.2023 was dismissed.
2. By the judgment of conviction dated 20.04.2023, the petitioner was convicted for the offence under Section 138 of the Negotiable Instruments Act, 1881 ((cid:145)NI Act(cid:146)) in CC No. 3710/2018. By the order on sentence dated 28.04.2023, the Signature Not Verified Signed By:KAMALDEEP KAUR Signing Date:28.11.2025 21:20:36 CRL.REV.P.(NI) 68/2025 petitioner was directed to pay a find of ₹5,00,000/- to the complainant within a period of 60 days and in default, to undergo imprisonment for a period of six month, the complainant was also given liberty to move an application under Section 421 of the Code of Criminal Procedure, 1971 ((cid:145)CrPC(cid:146)).
3. The learned counsel for the petitioner submits that since the passing of the impugned order, the parties have amicably settled all their disputes inter se. He submits that in terms of the Memorandum of Understanding dated 07.03.2025, the entire settlement amount has been paid to Respondent No. 2.
4. He further submits that cost ₹51,000/- has been deposited with the Delhi High Court Legal Services Committee.
6. The complainant is present in person. On being asked, he confirms the fact that the parties have settled their disputes and that he has received the entire settlement amount. He further states that there is no objection if the offence under Section 138 of the NI Act is compounded.
7. Offence under Section 138 of the NI Act is compoundable in nature.
8. Even though an attempt for compounding of the offence under NI Act should be made at the initial stage rather than the later stage, however, is no bar against seeking compounding of the offence even after conviction [Ref. Raj Reddy Kallem v. The State of Haryana & Anr. : 2024 INSC 347, K.M Ibrahim v. K.P Mohammed & Anr. : (2010) 1 SCC 798, etc.].
9. The Hon(cid:146)ble Apex Court in the case of Damodar S. Signature Not Verified Signed By:KAMALDEEP KAUR Signing Date:28.11.2025 21:20:36 CRL.REV.P.(NI) 68/2025 Prabhu v. Sayed Babalal H. : (2010) 5 SCC 663 had highlighted that the compensatory aspect of the proceedings under the NI Act take precedence over the punitive aspect and stipulated certain guidelines for compounding the offences under the NI Act. The relevant portion of the judgment is reproduced hereunder: (cid:147)4(cid:133) What must be remembered is that the dishonour of a cheque can be best described as a regulatory offence that has been created to serve the public interest in ensuring the reliability of these instruments. The impact of this offence is usually confined commercial transactions. the private parties involved
18. It is quite obvious that with respect to the offence of dishonour of cheques, it is the compensatory aspect of the remedy which should be given priority over the punitive aspect. There is also some support for the apprehensions raised by the learned Attorney General that a majority of cheque bounce cases are indeed being compromised or settled by way of compounding, albeit during the later stages of litigation thereby contributing to undue delay in justice delivery. The problem herein is with the tendency of litigants to belatedly choose compounding as a means to resolve their dispute(cid:133)
21. With regard to the progression of litigation in cheque bouncing cases, the learned Attorney General has urged this Court to frame guidelines for a graded scheme of imposing costs on parties who unduly delay compounding of the offence. It was submitted that the requirement of deposit of the costs will act as a deterrent for delayed composition, since at present, free and easy compounding of offences at any stage, however belated, gives an incentive to the drawer of the cheque to delay settling the cases for years. An application for compounding made after several years not only results complainant is also deprived of effective justice. In view of this submission, we direct that the following guidelines be followed: the system being burdened but THE GUIDELINES (i) In the circumstances, it is proposed as follows: (a) That directions can be given that the writ of summons be suitably modified making it clear to the accused that he Signature Not Verified Signed By:KAMALDEEP KAUR Signing Date:28.11.2025 21:20:36 CRL.REV.P.(NI) 68/2025 could make an application for compounding of the offences at the first or second hearing of the case and that if such an application is made, compounding may be allowed by the court without imposing any costs on the accused. (b) If the accused does not make an application for compounding as aforesaid, then if an application for compounding is made before the Magistrate at a subsequent stage, compounding can be allowed subject to the condition that the accused will be required to pay 10% of the cheque amount to be deposited as a condition for compounding with the Legal Services Authority, or such authority as the court deems fit. (c) Similarly, if the application for compounding is made before the Sessions Court or a High Court in revision or appeal, such compounding may be allowed on the condition that the accused pays 15% of the cheque amount by way of costs. (d) Finally, if the application for compounding is made before the Supreme Court, the figure would increase to 20% of the cheque amount.(cid:148)
10. In the present case, the parties have settled the matter at the appellate stage. It is relevant to note that complainant has duly consented to compounding the offence in the present case. Moreover, the entire settlement amount has been received by him.
11. The cost has also been deposited by the petitioner.
12. Considering the above, the present petition is allowed and the subject complaint is compounded. Consequently, impugned order dated 18.02.2025 and the judgment of conviction dated 20.04.2023 and order on sentence dated 28.04.2023 are set aside. Pending application(s), if any, also stand disposed of. NOVEMBER 26, 2025 DU Signature Not Verified Signed By:KAMALDEEP KAUR Signing Date:28.11.2025 21:20:36 CRL.REV.P.(NI) 68/2025 AMIT MAHAJAN, J
VIJAY KUMAR ARORA & ANR. Through: Mr. .....Respondents Verma, Sahil Advocate for R-1. Complainant in person. CORAM: HON’BLE MR. JUSTICE AMIT MAHAJAN AMIT MAHAJAN, J.(ORAL)
1. The present petition is filed for quashing and setting aside of the order dated 18.02.2025 (hereafter (cid:145)impugned order(cid:146)), passed by the learned Additional Sessions Judge-05 ((cid:145)ASJ(cid:146)), Dwarka Courts, New Delhi, in Criminal Appeal No. 271/2023 whereby the appeal filed by the petitioner challenging the judgment of conviction dated 20.04.2023 and order on sentence dated 28.04.2023 was dismissed.
2. By the judgment of conviction dated 20.04.2023, the petitioner was convicted for the offence under Section 138 of the Negotiable Instruments Act, 1881 ((cid:145)NI Act(cid:146)) in CC No. 3710/2018. By the order on sentence dated 28.04.2023, the Signature Not Verified Signed By:KAMALDEEP KAUR Signing Date:28.11.2025 21:20:36 CRL.REV.P.(NI) 68/2025 petitioner was directed to pay a find of ₹5,00,000/- to the complainant within a period of 60 days and in default, to undergo imprisonment for a period of six month, the complainant was also given liberty to move an application under Section 421 of the Code of Criminal Procedure, 1971 ((cid:145)CrPC(cid:146)).
3. The learned counsel for the petitioner submits that since the passing of the impugned order, the parties have amicably settled all their disputes inter se. He submits that in terms of the Memorandum of Understanding dated 07.03.2025, the entire settlement amount has been paid to Respondent No. 2.
4. He further submits that cost ₹51,000/- has been deposited with the Delhi High Court Legal Services Committee.
6. The complainant is present in person. On being asked, he confirms the fact that the parties have settled their disputes and that he has received the entire settlement amount. He further states that there is no objection if the offence under Section 138 of the NI Act is compounded.
7. Offence under Section 138 of the NI Act is compoundable in nature.
8. Even though an attempt for compounding of the offence under NI Act should be made at the initial stage rather than the later stage, however, is no bar against seeking compounding of the offence even after conviction [Ref. Raj Reddy Kallem v. The State of Haryana & Anr. : 2024 INSC 347, K.M Ibrahim v. K.P Mohammed & Anr. : (2010) 1 SCC 798, etc.].
9. The Hon(cid:146)ble Apex Court in the case of Damodar S. Signature Not Verified Signed By:KAMALDEEP KAUR Signing Date:28.11.2025 21:20:36 CRL.REV.P.(NI) 68/2025 Prabhu v. Sayed Babalal H. : (2010) 5 SCC 663 had highlighted that the compensatory aspect of the proceedings under the NI Act take precedence over the punitive aspect and stipulated certain guidelines for compounding the offences under the NI Act. The relevant portion of the judgment is reproduced hereunder: (cid:147)4(cid:133) What must be remembered is that the dishonour of a cheque can be best described as a regulatory offence that has been created to serve the public interest in ensuring the reliability of these instruments. The impact of this offence is usually confined commercial transactions. the private parties involved
18. It is quite obvious that with respect to the offence of dishonour of cheques, it is the compensatory aspect of the remedy which should be given priority over the punitive aspect. There is also some support for the apprehensions raised by the learned Attorney General that a majority of cheque bounce cases are indeed being compromised or settled by way of compounding, albeit during the later stages of litigation thereby contributing to undue delay in justice delivery. The problem herein is with the tendency of litigants to belatedly choose compounding as a means to resolve their dispute(cid:133)
21. With regard to the progression of litigation in cheque bouncing cases, the learned Attorney General has urged this Court to frame guidelines for a graded scheme of imposing costs on parties who unduly delay compounding of the offence. It was submitted that the requirement of deposit of the costs will act as a deterrent for delayed composition, since at present, free and easy compounding of offences at any stage, however belated, gives an incentive to the drawer of the cheque to delay settling the cases for years. An application for compounding made after several years not only results complainant is also deprived of effective justice. In view of this submission, we direct that the following guidelines be followed: the system being burdened but THE GUIDELINES (i) In the circumstances, it is proposed as follows: (a) That directions can be given that the writ of summons be suitably modified making it clear to the accused that he Signature Not Verified Signed By:KAMALDEEP KAUR Signing Date:28.11.2025 21:20:36 CRL.REV.P.(NI) 68/2025 could make an application for compounding of the offences at the first or second hearing of the case and that if such an application is made, compounding may be allowed by the court without imposing any costs on the accused. (b) If the accused does not make an application for compounding as aforesaid, then if an application for compounding is made before the Magistrate at a subsequent stage, compounding can be allowed subject to the condition that the accused will be required to pay 10% of the cheque amount to be deposited as a condition for compounding with the Legal Services Authority, or such authority as the court deems fit. (c) Similarly, if the application for compounding is made before the Sessions Court or a High Court in revision or appeal, such compounding may be allowed on the condition that the accused pays 15% of the cheque amount by way of costs. (d) Finally, if the application for compounding is made before the Supreme Court, the figure would increase to 20% of the cheque amount.(cid:148)
10. In the present case, the parties have settled the matter at the appellate stage. It is relevant to note that complainant has duly consented to compounding the offence in the present case. Moreover, the entire settlement amount has been received by him.
11. The cost has also been deposited by the petitioner.
12. Considering the above, the present petition is allowed and the subject complaint is compounded. Consequently, impugned order dated 18.02.2025 and the judgment of conviction dated 20.04.2023 and order on sentence dated 28.04.2023 are set aside. Pending application(s), if any, also stand disposed of. NOVEMBER 26, 2025 DU Signature Not Verified Signed By:KAMALDEEP KAUR Signing Date:28.11.2025 21:20:36 CRL.REV.P.(NI) 68/2025 AMIT MAHAJAN, J