Delhi High Court
Sachin Kapoor vs Vijay Kumar Arora & Anr on 26 November, 2025
$~14
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Date of Decision: November 26, 2025
+ CRL.REV.P.(NI) 68/2025 & CRL.M.A. 7004/2025,
CRL.M.A. 7734/2025, CRL.M.(BAIL) 494/2025
SACHIN KAPOOR .....Petitioner
Through: Counsel for the petitioner
appearance not given.
versus
VIJAY KUMAR ARORA & ANR. .....Respondents
Through: Mr. Sahil Verma,
Advocate for R-1.
Complainant in person.
CORAM:
HON'BLE MR. JUSTICE AMIT MAHAJAN
AMIT MAHAJAN, J.(ORAL)
1. The present petition is filed for quashing and setting aside
of the order dated 18.02.2025 (hereafter 'impugned order'),
passed by the learned Additional Sessions Judge-05 ('ASJ'),
Dwarka Courts, New Delhi, in Criminal Appeal No. 271/2023
whereby the appeal filed by the petitioner challenging the
judgment of conviction dated 20.04.2023 and order on sentence
dated 28.04.2023 was dismissed.
2. By the judgment of conviction dated 20.04.2023, the
petitioner was convicted for the offence under Section 138 of the
Negotiable Instruments Act, 1881 ('NI Act') in CC No.
3710/2018. By the order on sentence dated 28.04.2023, the
petitioner was directed to pay a find of ₹5,00,000/- to the
complainant within a period of 60 days and in default, to undergo
imprisonment for a period of six month, the complainant was
also given liberty to move an application under Section 421 of
the Code of Criminal Procedure, 1971 ('CrPC').
3. The learned counsel for the petitioner submits that since
the passing of the impugned order, the parties have amicably
settled all their disputes inter se. He submits that in terms of the
Memorandum of Understanding dated 07.03.2025, the entire
settlement amount has been paid to Respondent No. 2.
4. He further submits that cost ₹51,000/- has been deposited
with the Delhi High Court Legal Services Committee.
5. The complainant is present in person.
6. On being asked, he confirms the fact that the parties have
settled their disputes and that he has received the entire
settlement amount. He further states that there is no objection if
the offence under Section 138 of the NI Act is compounded.
7. Offence under Section 138 of the NI Act is compoundable
in nature.
8. Even though an attempt for compounding of the offence
under NI Act should be made at the initial stage rather than the
later stage, however, there is no bar against seeking
compounding of the offence even after conviction [Ref. Raj
Reddy Kallem v. The State of Haryana & Anr. : 2024 INSC
347, K.M Ibrahim v. K.P Mohammed & Anr. : (2010) 1 SCC
798, etc.].
9. The Hon'ble Apex Court in the case of Damodar S.
Prabhu v. Sayed Babalal H. : (2010) 5 SCC 663 had highlighted
that the compensatory aspect of the proceedings under the NI Act
take precedence over the punitive aspect and stipulated certain
guidelines for compounding the offences under the NI Act. The
relevant portion of the judgment is reproduced hereunder:
"4... What must be remembered is that the dishonour of a
cheque can be best described as a regulatory offence that has
been created to serve the public interest in ensuring the
reliability of these instruments. The impact of this offence is
usually confined to the private parties involved in
commercial transactions.
18. It is quite obvious that with respect to the offence of
dishonour of cheques, it is the compensatory aspect of the
remedy which should be given priority over the punitive
aspect. There is also some support for the apprehensions
raised by the learned Attorney General that a majority of
cheque bounce cases are indeed being compromised or
settled by way of compounding, albeit during the later stages
of litigation thereby contributing to undue delay in justice
delivery. The problem herein is with the tendency of
litigants to belatedly choose compounding as a means to
resolve their dispute...
21. With regard to the progression of litigation in cheque
bouncing cases, the learned Attorney General has urged this
Court to frame guidelines for a graded scheme of imposing
costs on parties who unduly delay compounding of the
offence. It was submitted that the requirement of deposit of
the costs will act as a deterrent for delayed composition,
since at present, free and easy compounding of offences at
any stage, however belated, gives an incentive to the drawer
of the cheque to delay settling the cases for years. An
application for compounding made after several years not
only results in the system being burdened but the
complainant is also deprived of effective justice. In view of
this submission, we direct that the following guidelines be
followed:
THE GUIDELINES
(i) In the circumstances, it is proposed as follows:
(a) That directions can be given that the writ of summons be
suitably modified making it clear to the accused that he
could make an application for compounding of the
offences at the first or second hearing of the case and
that if such an application is made, compounding may be
allowed by the court without imposing any costs on the
accused.
(b) If the accused does not make an application for
compounding as aforesaid, then if an application for
compounding is made before the Magistrate at a
subsequent stage, compounding can be allowed subject to
the condition that the accused will be required to pay
10% of the cheque amount to be deposited as a condition
for compounding with the Legal Services Authority, or
such authority as the court deems fit.
(c) Similarly, if the application for compounding is made
before the Sessions Court or a High Court in revision or
appeal, such compounding may be allowed on the
condition that the accused pays 15% of the cheque
amount by way of costs.
(d) Finally, if the application for compounding is made
before the Supreme Court, the figure would increase to
20% of the cheque amount."
10. In the present case, the parties have settled the matter at
the appellate stage. It is relevant to note that complainant has
duly consented to compounding the offence in the present case.
Moreover, the entire settlement amount has been received by
him.
11. The cost has also been deposited by the petitioner.
12. Considering the above, the present petition is allowed and
the subject complaint is compounded. Consequently, the
impugned order dated 18.02.2025 and the judgment of conviction
dated 20.04.2023 and order on sentence dated 28.04.2023 are set
aside. Pending application(s), if any, also stand disposed of.
AMIT MAHAJAN, J
NOVEMBER 26, 2025
DU
