The Madras High Court held that the offense under Section 138 of the Negotiable Instruments Act stood compounded under Section 147 of the same Act.  

August 18, 2023by Primelegal Team0

Dated : 17.08.2023

CORAM

THE HONOURABLE MR.JUSTICE K.K.RAMAKRISHNAN

Crl.R.C(MD)No.279 of 2022

 

Introduction:

The case of S. Madan v. T. Dhanam revolves around a Criminal Revision Petition filed under Section 397 r/w 401 of the Code of Criminal Procedure (Cr.P.C.). The petitioner/appellant, S. Madan, challenges the judgments of conviction and sentence passed by the trial court and confirmed by the appellate court for an offense under Section 138 of the Negotiable Instruments Act. The case took an interesting turn when the parties reached a compromise before the National Lok Adalat, leading to the quashing of the charges against the petitioner.

Background:

  1. Madan, the petitioner, had borrowed a sum of Rs.12,00,000 from the respondent, T. Dhanam, on various occasions. To repay this debt, Madan issued a cheque bearing No.065522 dated 24.06.2013, which was presented by Dhanam but returned with an endorsement of “Payment Stopped by Drawer.” Dhanam then issued a legal notice to Madan on 26.07.2013, but Madan did not make any payment. Consequently, Dhanam filed a complaint under Section 138 of the Negotiable Instruments Act before the Judicial Magistrate No.IV, Tiruchirappalli.

Court Proceedings:

Madan appeared before the trial court after receiving the summons and contested the case. After following due procedure, the trial court examined witnesses and perused documents, leading to a conviction under Section 138 of the Negotiable Instruments Act. Madan was sentenced to six months of Simple Imprisonment and a fine of Rs.5,000, with an additional one month of Simple Imprisonment in case of default, as per the judgment dated 20.12.2019.

Aggrieved by the trial court’s decision, Madan filed a Criminal Appeal in Crl.A.No.5 of 2020 before the Sessions Judge Mahila Court, Tiruchirappalli, which upheld the conviction and sentence in an order dated 14.09.2021. Dissatisfied with this outcome, Madan filed a Criminal Revision Petition challenging both the trial court’s judgment and the appellate court’s confirmation.

Joint Compromise Memo:

During the hearing of the Criminal Revision Petition, an unexpected development occurred. Both parties – Madan (through his counsel) and Dhanam (personally) – informed the court that they had reached a compromise. They had participated in the National Lok Adalat held on 08.07.2023 and submitted a joint compromise memo detailing their agreement to settle the matter amicably.

Lok Adalat Award and Court’s Decision:

Based on the joint compromise memo presented before the National Lok Adalat, the Lok Adalat issued an award on 08.07.2023. Taking into account this award and the compromised position of both parties, the court held that the offense under Section 138 of the Negotiable Instruments Act stood compounded under Section 147 of the same Act. Consequently, the court allowed the Criminal Revision Petition and set aside the judgments of the trial court and the appellate court.

Conclusion:

The case of S. Madan v. T. Dhanam illustrates the significance of alternative dispute resolution mechanisms, such as Lok Adalats, in resolving legal disputes amicably. The unexpected turn of events, wherein both parties decided to compromise and settle their differences, showcases the flexibility and effectiveness of such mechanisms in achieving speedy and mutually acceptable resolutions. This case analysis highlights the evolving nature of legal proceedings and the emphasis on achieving justice through collaboration rather than adversarial proceedings. The court’s decision to quash the charges based on the compromise memo and Lok Adalat award underscores the principle of restorative justice and the importance of parties working together to find solutions outside the conventional litigation process.

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Written by- Shreeya S Shekar

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