Allowed¶33

Sri Arun Dutta v. the State of Assam

Gauhati HC14 Oct 2025Crl.Rev.P./391/2025

Case brief

AI extract

What is this about?

Section 138 NI Act; Section 147 NI Act; compounding of offence under NI Act; settlement/compromise after conviction; cheque dishonour; quashing of conviction and sentence; criminal revision; Section 442/438 BNSS 2023; Section 528 BNSS; Gauhati High Court; Shamima Jahan, J.; M/s Gimpex Private Limited v. Manoj Goel (2021 SCC Online SC 925); Meters and Instruments (P) Ltd v. Kanchan Mehta (cited within quoted extract); fine Rs. 5,30,000/-; release of convicted accused; JMFC North Lakhimpur; N.I Case No. 04/2021; neutral citation 2025:GAU-AS:13787.

What did the court decide?

Revision allowed; impugned Judgment and Order dated 25.02.2025 in N.I Act Case No. 04/2021 set aside; order of conviction and sentence under Section 138 N.I Act quashed; petitioner to be released forthwith if not required in some other case; petition disposed of.

Sri Arun Dutta Vs the State of Assam — Cheque Dishonour | Gauhati HC (2025)

What the court decided

AI extract

Outcome

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Issue for consideration

Whether the criminal revision challenging the Judgment and Order dated 25.02.2025 convicting the petitioner under Section 138 of the N.I Act deserves to be allowed in view of the compromise/settlement dated 04.09.2025 between the petitioner and respondent No. 2, the offence being compoundable under Section 147 of the N.I Act.

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Court's answer

As settled by the Hon'ble Apex Court, an offence under the N.I Act is a civil wrong and has been specifically made compoundable by Section 147 of the N.I Act, inserted by the 2002 Amendment Act.

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Ratio / Principle

Although dishonour of cheque entails criminal consequences, the legislature by virtue of Section 147 of the N.I Act has made the offence compoundable, and it can be compounded at any stage of the proceeding, specially when the parties arrive at a settlement.

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Key takeaways

On the compromise deed dated 04.09.2025, the petitioner paid the full amount to respondent No. 2, and the agreement was found to be without any coercion and at the own will of respondent No. 2.ratio¶31
In light of the settlement, the present revision deserves to be allowed and the impugned Judgment and Order dated 25.02.2025 passed in N.I Act Case No. 04/2021 by the learned JMFC, Lakhimpur, North Lakhimpur, Assam is set aside.ratio¶31

Detailed headnote1 paragraphs

Gauhati High Court (Shamima Jahan, J.), Crl.Rev.P./391/2025, decided 15.10.2025 — Criminal revision under Section 442/438 of BNSS, 2023 read with Section 528 of BNSS against conviction under Section 138 of the N.I Act (Judgment and Order dated 25.02.2025, JMFC, North Lakhimpur, in N.I Case No. 04/2021: six months SI and fine of Rs. 5,30,000/- with default clause, fine payable to complainant as compensation). Pending revision, the petitioner paid the full cheque amount of Rs. 5,30,000/- to the complainant (respondent No. 2) under a compromise deed and affidavit dated 04.09.2025, whereby the complainant agreed to withdraw his case and stated he had no grievance; the agreement was found voluntary. Relying on Section 147 of the N.I Act (inserted by the 2002 Amendment Act) and M/s Gimpex Private Limited v. Manoj Goel, 2021 SCC Online SC 925, the Court held that although cheque dishonour entails criminal consequences, the offence is compoundable at any stage of the proceeding, specially upon settlement. Revision allowed; impugned judgment and order set aside; conviction and sentence quashed; petitioner directed to be released forthwith if not required in another case. Petition disposed of.

Page No.# 1/4

GAHC010142542025

2025:GAU-AS:13787

THE GAUHATI HIGH COURT (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)

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Case No. : Crl.Rev.P./391/2025

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SRI ARUN DUTTA

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S/O KUKHESWAR DUTTA, R/O VILL.- ATHKOTIA, P.O.-AZAD, P.S.PANIGAON, DIST.- LAKHIMPUR, ASSAM.

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VERSUS

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THE STATE OF ASSAM REP. BY THE P.P., ASSAM

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2:SRI BABUL KR. LAHON S/O LATE MULARAM LAHON R/O VILL.- GOBORISHALI P.O.- BOGOLIJAN P.S.- NORTH LAKHIMPUR DIST.- LAKHIMPUR ASSAM

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Advocate for the Petitioner : MS A GOGOI,

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Advocate for the Respondent : PP, ASSAM,

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BEFORE HONOURABLE MRS. JUSTICE SHAMIMA JAHAN

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ORDER

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15.10.2025

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Heard Mr. S. Gogoi, learned counsel appearing for the petitioner. Also

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Page No.# 2/4

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heard the learned counsel appearing for the respondent No. 2.

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The present application has been filed under Section 442/438 of BNSS, 2023 read with Section 528 of BNSS challenging the Judgment and Order dated 25.02.2025 passed by the Learned Court of Judicial Magistrate First Class, Lakhimpur, North Lakhimpur, in connection with N.I Case NO. 04/2021 under Section 138 of N.I Act.

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By the said Judgment and Order, the petitioner has been convicted under Section 138 of the N.I Act and a sentence to undergo SI for six (6) months and a fine of Rs. 5,30,000/- (Rupees Five Lakh Thirty Thousand) with default clause was imposed.

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In pursuant to the said judgment, it is said by the learned counsel appearing for the petitioner that the petitioner was incarcerated and he is inside the jail for 171 days and it is also stated at the bar that the cheque amount being Rs. 5,30,000/- (Rupees Five Lakh Thirty Thousand) has been paid by the petitioner to respondent No. 2 by executing an agreement on 04.09.2025. It was directed in the impugned Judgment and Order that the fine amount when realized shall be given to the complainant as compensation. In the said agreement it is stipulated that on 04.09.2025 the petitioner had given the full amount of the cheque to respondent No. 2 and that he has accepted the same with the further stipulation that in view of the same, the respondent has agreed

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Page No.# 3/4

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that he would withdraw the case that he has filed before the Court and that he has no grievance against the petitioner.

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It has been settled by the Hon’ble Apex Court that offence under the N.I Act is a civil wrong and has been made specifically compoundable by Section 147 of the N.I Act which was inserted by the 2002 Amendment Act to that act.

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Further in M/s Gimpex Private Limited Vs. Manoj Goel reported in 2021 SCC Online SC 925, the Hon’ble Apex Court took into consideration the effect of settlement arrived between the parties and observed in the following terms.

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“28. Given that the primary purpose of Section 138 of the NI Act is to ensure compensation to the complainant, the NI Act also allows for parties to enter into a compromise, both during the pendency of the complaint and even after the conviction of the accused. The decision of this Court in Meters and Instruments (P) Ltd . v. Kanchan Mehta²² summarises the objective of allowing compounding of an offence under Section 138 of the NI Act:

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“18.2. The object of the provision being primarily compensatory, punitive

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element being mainly with the object of enforcing the compensatory element, compounding at the initial stage has to be encouraged but is not debarred at later stage subject to appropriate compensation as may be found acceptable to the parties or the court.”

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Page No.# 4/4

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Therefore, it is clear that although dishonor of cheque entails criminal consequences, the legislature by virtue of Section 147 of the N.I Act has made it compoundable and the same can be compoundable at any stage of the proceeding specially when the parties arrive at a settlement.

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In the present case the compromise deed has been entered into on 04.09.2025 and the affidavit was also filed on the said date and it is seen that the petitioner has paid the full amount to the respondent and it is also noticed that the said agreement was without any coercion and at the own will of respondent No. 2. Therefore, in the light of the above discussions, this Court is of the considered view that the present revision deserves to be allowed and the impugned Judgment and Order dated 25.02.2025 passed in N.I Act Case No. 04/2021 by the Learned Court of Judicial Magistrate First Class, Lakhimpur, North Lakhimpur, Assam is set aside and the order of conviction and sentence imposed on the petitioner is quashed.

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The petitioner may be released forthwith if not required in some other case.

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The petition is disposed of.

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JUDGE

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Comparing Assistant

Sri Arun Dutta v. the State of Assam

Case brief

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Sri Arun Dutta v. the State of Assam

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