Virender Singh Dongwal v. Manju Aggarwal - S.138 NI Act - Quasi - Criminal

Negotiable Instruments Act - Section 138 - The offence under Section 138 of the NI Act is quasi-criminal in nature and is explicitly made compoundable under Section 147 of the Act. The legislative intent is to ensure the payment of money and promote the credibility of cheques- Referred to modified guidelines of compounding from Sanjabij Tari v. Kishore S. Borcar : (a) If the accused pays the cheque amount before recording of his evidence (namely defence evidence), then the Trial Court may allow compounding of the offence without imposing any cost or penalty on the accused. (b) If the accused makes the payment of the cheque amount post the recording of his evidence but prior to the pronouncement of judgment by the Trial Court, the Magistrate may allow compounding of the offence on payment of additional 5% of the cheque amount with the Legal Services Authority or such other Authority as the Court deems fit. (c) Similarly, if the payment of cheque amount is made before the Sessions Court or a High Court in Revision or Appeal, such Court may compound the offence on the condition that the accused pays 7.5% of the cheque amount by way of costs. (d) Finally, if the cheque amount is tendered before this Court, the figure would increase to 10% of the cheque amount.  (Para 16-17)