LI Network
Published on: January 9, 2024 at 09:58 IST
In a recent pronouncement on a Criminal Appeal concerning Section 138 of the Negotiable Instruments Act, 1881, the Supreme Court has decreed that the initiation of proceedings under this provision should be quashed once a settlement has been reached, and the complainant has formally endorsed the settlement deed.
The bench, comprising Justices Vikram Nath and Satish Chandra Sharma, affirmed, “Considering the overall facts and circumstances of the case, we are of the view that once the settlement has been arrived at and the complainant has signed the deed accepting a particular amount in full and final settlement of the default amount and the fine amount awarded by the Trial Court, the proceedings under Section 138 of the NI Act need to be quashed.”
The appeal arose from a challenge to the High Court of Himachal Pradesh’s order on September 13, 2017. The High Court had upheld the conviction of the accused individuals (the present petitioners) under Section 138 of the N.I. Act.
However, during the interim period, the parties reached a compromise deed. According to this agreement, the complainant consented to a specified amount as a comprehensive settlement of the cheque amount and the fines imposed by both the Trial Court and confirmed by the High Court.
Considering these developments, the Supreme Court allowed the appeal, recognizing the significance of the settlement reached between the parties.
Case Title: GHANSHYAM GAUTAM vs. USHA RANI (SINCE DECEASED) THROUGH L.R.S RAVI SHANKAR, Diary No.- 8428 – 2018
