Sri Ram Chaudhary vs State of Bihar & Anr

Heard the parties.

The present quashing petition has been preferred to quash the order dated 05.11.2018 passed by learned Additional Sessions Judge-VIII, Saran in Cr. Rev. No. 179/2018 arising out of Complaint Case No. 3145/2017, where learned Revisional Court dismissed the revision application and refused to interfere with the order of cognizance order dated 16.05.2018 as passed by learned ACJM-VIII, Saran, where cognizance was taken for the offence punishable under Section 138 of the NI Act, 1881.

OP No. 2 joined the present court proceedings.

The allegation of the complainant, in brief, is that the complainant and the petitioner are residents of the same village. It is alleged that on 11.10.2014, the petitioner requested financial assistance from the complainant for purchasing a Bolero Car, whereupon the complainant, a retired Sub-Inspector, paid him Rs. 2.50 lakhs through Cheque No. 80858 for running his business. Thereafter, on 15.10.2014, the complainant allegedly paid a further sum of Rs. 1.50 lakhs in cash, and on 03.12.2014, he paid another Rs. 4 lakhs through Cheque No. 654281. It is further alleged that, earlier, on 20.08.2013, the petitioner had also taken Rs. 50,000/- from the complainant's son. Subsequently, towards repayment of the aforesaid amount, the petitioner allegedly issued a cheque for Rs. 8.75 lakhs on 27.07.2017, which was dishonoured upon presentation. The said cheque was again deposited on 04.08.2017, but was returned unpaid and received back by the complainant on 30.08.2017. Thereafter, on 15.09.2017, the complainant, through his advocate, issued a legal notice to the petitioner, to which the petitioner allegedly failed to respond. Hence, the present complaint case.

Learned counsel appearing on behalf of the petitioner submits that during the pendency of the present proceeding, the dispute between the petitioner and OP No. 2 has been amicably settled through the intervention of the Patna High Court Mediation Centre. It is submitted that the parties entered into a Memorandum of Agreement dated 23.11.2023 in Mediation Proceeding No. 615 of 2023, arising out of the present case.

Learned counsel further submits that as per the terms of settlement, the petitioner agreed to pay a sum of Rs.4,00,000/- (Rupees Four Lakhs) to opposite party no.2 towards full and final settlement of the dispute. It is submitted that an amount of Rs.50,000/- was handed over to opposite party no.2 by way of Demand Draft No.000853 dated 23.11.2023 issued by HDFC Bank and the remaining amount was thereafter paid in terms of the settlement.

Learned counsel submits that pursuant to the aforesaid settlement, further amount were paid/deposited by the petitioner towards satisfaction of the agreed settlement amount. It is submitted that, as stated in the supplementary affidavit filed on behalf of the petitioner, an amount of Rs.68,000/- was paid through bank transactions and an amount of Rs.2,83,206/- was adjusted towards the value of building materials purchased by opposite party no.2 from the establishment of the petitioner, thereby making the total amount of Rs.4,01,206/- realized by opposite party no.2.

Learned counsel, accordingly, submits that the terms and conditions of the Memorandum of Agreement have been fulfilled and no dispute now survives between the parties. It is further submitted that the settlement was arrived voluntarily before the Mediation Centre and same was signed by both the parties as well as their respective learned counsels.

Learned APP appearing on behalf of the State and learned counsel appearing on behalf of opposite party no.2 do not dispute the factum of settlement arrived at between the parties before the Patna High Court Mediation Centre. Learned counsel for opposite party no.2 also does not dispute the receipt/realization of the agreed settlement amount and also by OP No. 2, who is present before the court in person and submits that, in view of the settlement, no dispute remains between the parties.

It would be apposite to reproduce the settlement terms of Mediation Centre, Patna High Court, which is as under:-

From the aforesaid terms of settlement, it is evident that the parties, with the intervention of the Patna High Court Mediation Centre, have voluntarily arrived at an amicable settlement and have agreed to treat the agreed payment of Rs.4,00,000/- as full and final settlement of their dispute. The settlement further specifically records that after making the full and final payment, the cases filed by the parties against each other would be withdrawn.

The supplementary affidavit filed on behalf of the petitioner further discloses that pursuant to the aforesaid Memorandum of Agreement, the amount agreed between the parties has been realized by opposite party no.2. The materials placed on record disclose payment of Rs.50,000/- through Demand Draft, further payment of Rs.68,000/- through bank transactions and an amount of Rs.2,83,206/- towards the value of materials purchased by opposite party no.2 from the establishment of the petitioner, making a total realization of Rs.4,01,206/-.

It is well settled that an offence punishable under Section 138 of the Negotiable Instruments Act is compoundable in view of the specific provision contained under Section 147 of the Negotiable Instruments Act. The object underlying the provision relating to dishonor of cheque is primarily compensatory in nature, and where the parties have voluntarily settled the dispute and the agreed amount has been paid, continuation of the criminal proceeding would not advance the cause of justice.

The inherent jurisdiction of this Court under Section 482 of the Code of Criminal Procedure is intended to secure the ends of justice and to prevent abuse of the process of the Court. The power is required to be exercised having regard to the facts and circumstances of each case. Where the dispute arising out of a cheque transaction has subsequently been amicably settled between the complainant and the accused and the settlement has been acted upon, the continuation of the criminal proceeding, particularly when the complainant no longer wishes to pursue the matter, would serve no useful purpose.

In the present case, the dispute between the petitioner and opposite party no.2 has been settled before the Mediation Centre of this Court. The terms of settlement were consciously accepted and signed by both the parties in the presence of their respective learned counsels. The agreed settlement amount has also been realized by opposite party no.2. Thus, the condition incorporated in the Memorandum of Agreement for making the full and final payment has already been fulfilled.

In view of aforesaid factual and legal discussions, as the matter has been amicably settled in the mediation proceeding between the parties and the settlement conditions have been acted upon, continuing with the criminal proceeding would only amount to abuse of the process of law. In the peculiar facts and circumstances of the present case, this Court is of the considered view that the impugned order as well as the consequential criminal proceeding deserves to be interfered with in exercise of its inherent jurisdiction under Section 482 of the Code of Criminal Procedure.

Accordingly, the impugned order dated 05.11.2018 as passed by learned Additional Sessions Judge-VIII, Saran in Criminal Revision No.179/2018, arising out of Complaint Case No.3145/2017, Trial No. 986 of 2018, as well as the order of cognizance dated 16.05.2018 passed by learned A.C.J.M.-VIII, Saran along with all its consequential proceedings against this petitioner, are hereby quashed and set aside.

Hence, this application stands allowed.

TCR (Trial Court Records), if any, be returned to the learned Trial Court alongwith the copy of this judgment.