Bombay High Court

SHOBHA W/O. SANJAY KALEversusSANJIVANI W/O. TANAJI KALE

Disposal: DISPOSED OFF
Bench: Y G KHOBRAGADE

Holding

Offences under Section 138 of the Negotiable Instruments Act are compoundable at any stage, and a penalty of Rs.5,000 is appropriate for the compounding.

Summary

The petitioner, Shobha Kale, sought relief in a criminal writ petition concerning a Summary Criminal Case under Section 138 of the Negotiable Instruments Act. The parties mediated and reached a compromise wherein the petitioner agreed to pay Rs. 3,00,000 to the respondent, withdraw a previously deposited amount, and make further payments by specified dates. The court, relying on the Supreme Court decision in Damodar S. Prabhu v. Sayed Babalal H., affirmed that offences under Section 138 are compoundable at any stage, including appellate proceedings. Accordingly, the court accepted the settlement and ordered the imposition of a penalty of Rs.5,000 as prescribed by the cited case law. The petition was consequently disposed of, with the penalty to be paid to the Legal Services Sub‑Committee within two weeks.

Issues considered

Whether an offence punishable under Section 138 of the Negotiable Instruments Act can be compounded at the appellate stage.
Whether a penalty should be imposed for compounding the offence at this stage of the proceedings.

Legislation cited

Negotiable Instruments Act — s. 138

Subjects

Section 138
Negotiable Instruments Act
compounding of offences
mediation
criminal proceeding
penalty
graded costs

Judgment

2026:BHC-AUG:15279
                                                                        934wp956-18

                      IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                 BENCH AT AURANGABAD

                       934 CRIMINAL WRIT PETITION NO. 956 OF 2018

                                  Shobha W/o. Sanjay Kale
                                          VERSUS
                                 Sanjivani W/o. Tanaji Kale
                                             ...
            Mr. Sunil Nimbalkar h/for Mr. Mehta Punit S, Advocate for the
            Petitioner
            Mr. Karad Murlidhar S, Advocate for Respondents



                                  CORAM     : Y. G. KHOBRAGADE, J.
                                  Dated     : 8th April, 2026

            PER COURT :-

            1.       In pursuance of the order dated 22.11.2025, the learned

            Mediator, Mr. Sandip Andhale, has submitted his report stating that the

            mediation has been successful. The mediation report, along with the

            terms of compromise, is taken on record and marked as ‘X’ for

            identification

            2.       As per the    terms of compromise,      the Petitioner Shobha

            Sanjay Kale/original accused and respondent Sanjivani Tanaji Kale/

            original complainant in Summary Criminal Case No. 2460 of 2016

            entered into compromise and agreed that the petitioner will pay an

            amount of Rs. 3,00,000/- to the respondent against the claim of

            Rs.3,03,187/-against the Cheque No. 105177 dated 19.01.2016, which

            is the subject matter of Summary Criminal Case no. 2460 of 2016.

            3.       As per the terms and conditions of the settlement prescribed in

            paragraph Nos. 3(II), 3(III) and 3(IV), the petitioner has consented to

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           the withdrawal by the respondent of an amount of Rs. 75,800/-, along

           with accrued interest, deposited by the petitioner before the Trial

           Court. It is further agreed that the petitioner will deposit Rs.50,000/-

           before the trial court on or before 25th April, 2026.        It is further

           agreed between the petitioner and respondent that the petitioner will

           deposit the unpaid outstanding amount on or before 30.04.2026 and

           the respondent will give consent for withdrawal of the criminal

           proceeding.

           4.        In Damodar S. Prabhu v. Sayed Babalal H. , (2010) 5 SCC 663,

           the Hon’ble Supreme Court has held that the offence punishable under

           Section 138 of the Negotiable Instruments Act is compoundable at any

           stage of the proceedings, including at the appellate stage and even

           before the Hon’ble Supreme Court. However, in the said judgment, the

           Hon’ble Supreme Court has further prescribed the conditions for

           imposing graded costs by way of penalty for compounding the offence,

           having regard to the stage of the proceedings at which the compromise

           is arrived at.

           5.        In view of the above, the present petition stands disposed of in

           terms of the settlement 'X'. However, considering the law laid down in

           the above cited case law, it would be just and proper to impose penalty

           of Rs.5000/-, to be paid to the account of the Legal Services Sub

           Committee, High Court, Aurangabad within a period of two weeks.



                                                          ( Y. G. KHOBRAGADE, J. )
JPChavan


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