Kamla Bhatia Vs the Jogindera Central Co-Operative… — Cheque Dishonour | Himachal Pradesh HC (2026)

Kamla Bhatia Vs the Jogindera Central Co-Operative… — Cheque Dishonour | Himachal Pradesh HC (2026)

What the court decided

AI extract

Outcome

Revision allowed: offence compounded under Section 147 of the Act; impugned judgments of conviction and sentence dated 05.01.2026 and 28.02.2023/14.03.2023 quashed and set aside; petitioner-accused acquitted of the Section 138 charge; interim orders vacated and bail bonds discharged; Rs. 55,000/- deposit released to respondent-complainant; Rs. 5,000/- litigation charges and Rs. 5,000/- compounding fee imposed on the petitioner within eight weeks.

Issue for consideration

Whether, upon amicable settlement between the parties, the offence under Section 138 of the Negotiable Instruments Act could be compounded under Section 147 of the Act notwithstanding the conviction recorded and affirmed by the Courts below, so as to quash the conviction and acquit the accused.

Court's answer

Upon the parties resolving to settle their dispute amicably and the respondent-complainant having no objection in compounding the offence if the deposited amount were released, this Court saw no impediment in accepting the petitioner's prayer for compounding of the offence under Section 147 of the Act, in terms of the guidelines issued by the Supreme Court in Damodar S. Prabhu, which permit compounding even after conviction by the Courts below.

Ratio / Principle

The present matter was ordered to be compounded and the impugned judgments of conviction and sentence dated 05.01.2026 and 28.02.2023/14.03.2023 passed by the Courts below were quashed and set aside; the petitioner-accused was acquitted of the charge framed against her under Section 138 of the Act, interim orders vacated and bail bonds discharged.

Key takeaways

The amount of Rs. 55,000/- lying deposited with the learned trial Court was ordered to be released in favour of the respondent-complainant by remitting it to its bank account, the details whereof to be furnished by its counsel within two weeks.ratio¶20
As the respondent-complainant was compelled to engage in unwarranted litigation for realization of its own money, the petitioner-accused was directed to pay Rs. 5,000/- as litigation charges to the respondent-complainant and to deposit Rs. 5,000/- with the H.P. State Legal Service Authority as compounding fee within eight weeks, failing which she would be liable to penal consequences as well as Contempt of Court.ratio¶23

Detailed headnote1 paragraphs

Negotiable Instruments Act — S. 138 — compounding of offence under S. 147 even after conviction — Criminal revision (BNSS, Ss. 438 & 442) — Accused, convicted by the JMFC, Solan (judgment/order dated 28.02.2023/14.03.2023: three months' simple imprisonment and Rs. 55,000/- compensation for a dishonoured cheque of Rs. 45,000/-), and upheld in appeal by the ASJ (I), Solan (judgment dated 05.01.2026 in Crl. Appeal No.28-S/10 of 2025/23), entered into a compromise with the complainant-Bank. Holding (Sandeep Sharma, J., oral): where parties settle amicably and the complainant raises no objection, the High Court, exercising power under S. 147 of the Act in terms of the Apex Court guidelines in Damodar S. Prabhu v. Sayed Babalal H., (2010) 5 SCC 663, may compound the S. 138 offence even after recording/affirmation of conviction. Judgments dated 05.01.2026 and 28.02.2023/14.03.2023 quashed and set aside; petitioner acquitted. Rs. 55,000/- deposit released to the complainant-Bank; petitioner to pay Rs. 5,000/- litigation charges to the complainant and deposit Rs. 5,000/- with the H.P. State Legal Service Authority as compounding fee within eight weeks, failing which penal consequences and Contempt of Court.

IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA

Cr. Revision No.258 of 2026 Date of Decision: 10.07.2026

__________________________________________________________________________ Kamla Bhatia ……...Petitioner Versus The Joginder Central Co-operative Bank Limited …....Respondent

Coram Hon’ble Mr. Justice Sandeep Sharma, Judge. Whether approved for reporting? For the Petitioner: Mr. Tarun Mehta, Advocate.

For the Respondent: Mr. Arvind Sharma, Advocate.

Sandeep Sharma, J. (Oral)

Instant criminal revision petition filed under Section 438 & 442 of the BNSS, lays challenge to judgment dated 05.01.2026, passed by the learned Additional Sessions Judge (I), Solan, District Solan, Himachal Pradesh, in Criminal Appeal No.28-S/10 of 2025/23, titled Kamla Bhatia Vs. The Joginder Central Co-operative Bank Limited, affirming judgment of conviction and order of sentence dated 28.02.2023/14.03.2023, passed by the learned Judicial Magistrate First Class, Court No.1, Solan, District Solan, Himachal Pradesh, whereby the learned trial Court while holding the petitioner-accused (hereinafter, ‘ accused ’) guilty of having committed offence punishable under Section 138 of the Negotiable Instruments Act (in short the “Act"), convicted and sentenced her to undergo simple imprisonment for a period of three months and pay compensation to the tune of ₹55,000/- to the complainant.

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Precisely, the facts of the case, as emerge from the record are that respondent-complainant (hereinafter, ‘ complainant ’) instituted a complaint under Section 138 of the Act, in the Court of learned Judicial Magistrate First Class, Court No.1, Solan, District Solan, Himachal Pradesh, alleging therein that accused with a view to discharge her liability issued Cheque for a sum of ₹45,000/-, but fact remains that aforesaid Cheque on its presentation, was dishonoured. Since petitioner-accused failed to make the payment good within the time stipulated in the legal notice, respondent/complainant was compelled to initiate proceedings before the competent Court of law under Section 138 of the Act.

Learned trial Court on the basis of material adduced on record by the respective parties, vide judgment/order dated 28.02.2023/14.03.2023, held the petitioner-accused guilty of having committed offence under Section 138 of the Act and accordingly, convicted and sentenced her, as per the description given hereinabove.

Being aggrieved and dissatisfied with the aforesaid judgment of conviction recorded by the Court below, accused preferred an appeal in the Court of learned Additional Sessions Judge (I), Solan, District Solan, Himachal Pradesh, which also came to be dismissed vide judgment dated 05.01.2026, as a consequence of which, judgment of conviction recorded by the learned trial Court came to be upheld. In the aforesaid background,

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petitioner-accused has approached this Court by way of instant proceedings, seeking therein her acquittal after setting aside the judgments of conviction recorded by the Courts below.

Before case at hand could be heard and decided on its own merits, parties have entered into compromise, whereby respondent/complainant has agreed to settle the dispute with the petitioner/accused. Counsel representing the petitioner, on instructions, states that amount of ₹55,000/- lying deposited with the trial Court has been agreed to be released in favour of respondent/complainant. He states that since petitioner/accused has agreed to pay sum of ₹55,000/-, as per the compromise, detailed hereinabove, this Court, while exercising power under Section 147 of the Act may proceed to compound the offence.

Mr. Arvind Sharma, learned counsel representing the respondent/complainant, states that he has instructions to depose on behalf of respondent-Bank. He states that in case sum of ₹55,000/- lying deposited

with the learned trial Court is ordered to be released in favour of complainant, complainant-Bank shall have no objection in case the judgments of conviction and order of sentence passed by the learned Courts below are quashed and set aside and the petitioner is acquitted of the charge framed against her. However, he states that some amount of litigation

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charges may be awarded in favour of complainant because it was unnecessarily dragged into litigation for realization of its own money.

Since parties have resolved to settle their dispute amicably inter se them, as has been taken note hereinabove, coupled with the fact that respondent/complainant has no objection in compounding the offence, in the event of its being released the amount lying deposited with the learned trial Court, this Court sees no impediment in accepting the prayer made on behalf of the petitioner for compounding of offence, while exercising power under Section 147 of the Act as well as in terms of guidelines issued by the Hon’ble Apex Cour t in Damodar S. Prabhu V. Sayed Babalal H. (2010) 5 SCC 663 , wherein it has been categorically held that Court, while exercising power under Section 147 of the Act, can proceed to compound the offence even after recording of conviction by the Courts below.

Consequently, in view of the above, present matter is ordered to be compounded and impugned judgments of conviction and sentence dated 05.01.2026 and 28.02.2023/14.03.2023, passed by the Courts below are quashed and set aside and the petitioner-accused is acquitted of the charge framed against her under Section 138 of the Act. Interim order, if any, is vacated. Bail bonds, if any, are discharged. Amount of ₹55,000/- lying deposited with the learned trial Court is ordered to be released in favour of

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the respondent-complainant by remitting the same in its bank account, detail whereof shall be furnished by its counsel within two weeks.

Since respondent/complainant was compelled to engage in unwarranted litigation with the petitioner/accused for realization of its own money, petitioner-accused is directed to pay a sum of ₹5000/- as litigation charges in favour of respondent/complainant and further to deposit ₹5000/with the H.P. State Legal Service Authority as compounding fee, within a period of eight weeks, failing which petitioner/accused shall render herself liable for penal consequences as well as Contempt of Court.

(Sandeep Sharma), Judge

July 10, 2026 (Rajeev Raturi)