BENGALURU: While setting aside the order of conviction and sentence in cheque bounce cases when the convicted offers himself for the settlement of the dispute by way of compromise through the Lok Adalat, trial courts should mandatorily observe in their order that any violation of terms of the compromise will automatically restore the sentencing and conviction from the stage where it was stopped before the trial court, the Karnataka High Court has said.
It referred to guidelines laid down by the Supreme Court on the settlement in a cheque dishonour case for offences punishable under Section 138 of the Negotiable Instruments Act. It said that one such direction is that if the application for compounding is made before the concerned court or the high court, such an offer should be allowed only on the condition that the accused pays 15 per cent of the cheque amount by way of costs.
Justice M Nagaprasanna passed the order while restoring the order of conviction and sentence dated August 26, 2015 against accused RB Green Field Agro Infra, represented by proprietor Rakshith, who got away with conviction through compromise in a cheque bounce case filed by Hemachandra M Kuppalli by playing fraud on the court and not paying the money settled in the Lok Adalat.
Rakshith had issued a cheque for Rs 49 lakh to Hemachandra and it was dishonoured in January 2014 for insufficient funds. The petitioner filed a case and it was allowed in 2015 by the magistrate court which convicted Rakshith and sentenced him to pay a fine of Rs 29.10 lakh. Rakshith filed an appeal before the sessions court which referred to Lok Adalat for settlement in 2016. Rakshith undertook to pay Rs 29 lakh in installments but failed to do so.
The petitioner filed an execution petition before the concerned court in 2017 but there has been no progress for six the last years though non-bailable warrant, fine levy warrant and arrest warrant were not executed against the accused. The high court noted that the settlement was arrived at before the Lok Adalat only to get the hanging sword of conviction taken away. It directed the sessions court to expedite the case of execution.