***

VINOD S. BHARDWAJ, J. –

The crucial point which arises from the present application is as to whether the High Court can quash/compound an offence under Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023, after it has already decided the main case. The present application seeks compounding/quashing of the proceedings after dismissal of the criminal revision, against the concurrent judgments of conviction, vide judgment date 13.07.2022, on the strength of clearance of the loan amount on 31.07.2024 i.e. nearly two years after dismissal of the criminal revision. The issue primarily being as to whether the criminal Court would become functus officio after a judgment is signed or whether the High Court can exercise the powers under Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023, with the aid of Section 359 of the Bharatiya Nyaya Sanhita, 2023 and modify its judgments. The question which goes along is as to whether a proceeding can be said to be pending, once an application is filed, even though final judgment may have been pronounced and signed.

2. Learned counsel appearing for the petitioner submits that the revision petition had arisen out of the judgment dated 08.08.2018 passed by the Chief Judicial Magistrate, Sri Muktsar Sahib, whereby the petitioner was convicted for the offence under Section 138 of the Negotiable Instruments Act, 1881 and sentenced to undergo rigorous imprisonment for a period of one year, along with a fine of Rs.3,000/- and in default of payment of fine, to undergo further rigorous imprisonment for one month. The conviction and sentence were upheld by the learned Additional Sessions Judge, Sri Muktsar Sahib, vide judgment dated 03.02.2022. He further submits that the revision petition preferred by the petitioner against the above judgments was dismissed by this Court on 13.07.2022.

3. Counsel contends that subsequent to the dismissal of the revision petition, the petitioner, on 31.07.2024, paid the entire loan amount along with interest to the respondent-bank and the parties have amicably resolved their dispute. The respondent-bank has also issued a clearance certificate acknowledging full satisfaction of its claim. In view thereof, it is submitted that the offence may now be permitted to be compounded and the conviction consequently set aside.

4. Counsel further submits that the offence under Section 138 of the Negotiable Instruments Act, 1881 is expressly made compoundable by virtue of Section 147 of the Act, which is a non obstante provision and, therefore, carries an overriding effect over the provisions of the Code of Criminal Procedure, including Sections 320 and 362. It is argued that it is a well-settled principle of law that a special statute prevails over a general statute and consequently, the special mechanism for compounding embodied in Section 147 of the NI Act must supersede the general prohibitions or limitations contained in the Cr.P.C. He accordingly contends that Section 147 of the NI Act eclipses the bar under Section 362 Cr.P.C. and thus this Court retains the competence to permit compounding of the offence and to recall or set aside the conviction order, particularly in light of the amicable settlement and full satisfaction of the claim between the parties.

5. In support of his submissions, learned counsel places reliance upon the decisions in Gian Chand Garg v. Harpal Singh & Anr., SLP (Criminal) No. 8050 of 2025, Rishi Mohan Srivastava v. State of U.P. & Anr., 2021 SCC OnLine All 532, and Babu Ram v. Punjab National Bank, 2024 (2) DCR 654.

6. To encapsulate his submissions, counsel contends that the very object and purpose of Section 147 of the Negotiable Instruments Act, 1881 is to encourage settlement and to facilitate restoration of commercial relations between parties engaged in financial transactions. Given that an offence under Section 138 of the Act is quasi-civil in nature and arising out of a monetary dispute, the compounding of such an offence subserves the larger ends of justice by ensuring finality and harmony between the parties, rather than permitting the criminal process to be prolonged unnecessarily.

7. Counsel appearing on behalf of the respondent-bank affirms that the petitioner has discharged his entire outstanding liability, inclusive of all interest accrued thereon, as on 31.07.2024. It is admitted that the bank has issued a clearance certificate acknowledging full and final settlement of its claim and that no dues remain pending against the petitioner. He further states that, in view of the amicable resolution of the dispute and the recovery of the entire amount for which the proceedings under Section 138 of the Negotiable Instruments Act, 1881 had been initiated, the respondent-bank has no objection if the offence is permitted to be compounded and that the bank does not oppose the prayer of the petitioner for setting aside the conviction in light of the compromise.

8. When the instant matter was taken up for consideration on 29.08.2025, this Court had passed the following order:

“Mr. Vijay Kumar Jindal, Sr. Advocate, who is present in the Court, is requested by this Court to assist this Court as regards maintainability of an application filed under Section 482 of Cr.P.C. for compounding under Section 147 of the Negotiable Instruments Act, 1881 after the proceedings have already attained finality and the revision has already been dismissed and as to whether the proceedings can be compounded by taking aid of “at any stage” as stipulated under Section 147 read with Section 138 of the Negotiable Instruments Act, 1881 as interpreted by the Allahabad High Court in the matter of ‘Rishi Mohan Srivastava Vs. State of UP and another’ reported as 2021 SCC OnLine All 532.”

xxxx xxxx xxxx

9. Learned Amicus submits that the evolution of the law relating to compounding of offences under Section 138 of the Negotiable Instruments Act, 1881 shows a clear judicial transition from a punitive framework to one anchored in restorative justice. The consistent trajectory of pronouncements rendered by the Hon’ble Supreme Court and various High Courts reveal an attempt to preserve the credibility of commercial transactions while simultaneously addressing the systemic burden imposed by cheque dishonour litigation and encouraging genuine settlements between disputing parties.

10. He contends that earlier, proceedings under Section 138 were approached as strictly criminal in character and the permissibility of compounding was tested on the anvil of Section 320 of the Code of Criminal Procedure. This restrictive approach, however, was found to be incongruent with the underlying object of the statute. A decisive shift occurred with the introduction of Section 147 by the Negotiable Instruments (Amendment and Miscellaneous Provisions) Act, 2002, which expressly declared offences under the Act to be compoundable notwithstanding anything contained in the CrPC. Judicial interpretation of this provision has consistently recognised it as a deliberate legislative departure from the rigidity of Section 320 CrPC, intended to confer wide and flexible discretion upon courts so as to facilitate settlement and reinforce commercial confidence.

11. He submits that the aforesaid was authoritatively delineated by the Hon’ble Supreme Court in Damodar S. Prabhu v. Sayed Babalal H., (2010) 5 SCC 663 = (2010) Law Today Live Doc. Id. 15231  wherein it was held that an offence under Section 138 is compoundable at any stage of the proceedings, including the appellate and revisional stages and even after conviction. Taking note of the enormous docket pressure generated by cheque dishonour cases, the Court adopted a pragmatic approach with a system to impose costs to discourage belated compromises while ensuring that technical procedural barriers do not defeat the cause of justice. This decision firmly establishes that the finality of conviction does not eclipse the statutory power of compounding.

12. He further submits that this liberal and justice-oriented approach was further reinforced in K.M. Ibrahim v. K.P. Mohammed, (2010) 1 SCC 798, wherein the Supreme Court held that even where conviction has been affirmed in appeal, the High Court retains the authority to permit compounding in revision. The Court underscored the significance of the non-obstante clause in Section 147, holding that it overrides procedural constraints and that the consent of the complainant remains the pivotal consideration.

13. He also submits that the restorative spirit was crystallised in Meters and Instruments (P) Ltd. v. Kanchan Mehta, (2018) 1 SCC 560 = (2017) Law Today Live Doc. Id. 18178, wherein the Hon’ble Supreme Court characterised cheque dishonour cases as predominantly civil in nature. The Court observed that once the complainant’s monetary claim stands satisfied, the continuation of criminal proceedings serves no meaningful purpose. It was held that courts possess ample latitude to close proceedings and permit compounding, even without insistence on rigid procedural compliance, provided the settlement is voluntary and bona fide. The same principle was reiterated in Makwana Mangaldas Tulsidas v. State of Gujarat, (2020) 4 SCC 695, where the Supreme Court reaffirmed that Section 147 enables compounding even at the post-conviction stage and deprecated hyper-technical objections founded on procedural finality. The Court reiterated that the objective of the NI Act is not to perpetuate incarceration, but to uphold the sanctity of negotiable instruments and ensure prompt restitution.

14. He points out that following this jurisprudential line, High Courts across the country have consistently exercised inherent powers under Section 482 CrPC or constitutional jurisdiction under Articles 226 and 227 to permit compounding at any stage including after dismissal of appeals or revisions, where the parties have amicably resolved their dispute. Reliance has been placed upon judgments rendered by Allahabad High Court in the case of Rishi Mohan Srivastava v. State of UP & Another reported as 2021 SCC OnLine All 532, by the Gujarat High Court in the case of Kirpalsingh Pratapsingh Sri v. Balvinder Kaur Hardinsingh Lobana reported as 2004 CriLJ 3786 and by the Himachal Pradesh High Court in the case of Babu Ram v. PNB reported as 2024 NCHHC 6263.

15. In summation, he submits that the law as it stands today provides primacy to settlement, restitution and commercial harmony over retributive punishment. The settled jurisprudence establishes that procedural finality must yield to the overarching obligation of courts to do complete and effective justice and that an offence under Section 138 of the NI Act may be compounded at any stage of the proceedings, so long as the complainant’s consent is present and the Court is satisfied as to the genuineness of the compromise and its consonance with the ends of justice.

16. I have heard the learned counsel appearing for the parties as well as learned amicus curiae and have gone through the judgments relied upon by them.

17. Before proceeding any further, it would be relevant to refer to the relevant statutory provisions: -

The Negotiable Instruments Act, 1881.

147. Offences to be compoundable.—Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), every offence punishable under this Act shall be compoundable.

18. It is evident from a perusal of the above that there is no change in so far as provision for compounding; alteration of judgment (Section 362 Cr.P.C.) or inherent powers of the High Court are concerned.

19. Even though Section 320 Cr.P.C. (Section 359 BNSS) would not be strictly applicable as N.I. Act has a specific provision under Section 147 for compounding, however, what significant is that while ‘pendency of proceedings before the Court’ is a pre-requisite under Section 320(2) Cr.P.C., such an expression is absent in Section 320(1) Cr.P.C. The said statutory distinction is vital only to appreciate that Legislature did qualify offences for which prosecution is pending and in some categories, compounding has been held permissible even when no proceeding is pending before the Court.

20. The same leads to the next provision under Section 362 Cr.P.C. (Section 403 BNSS) which allows a Court to alter a Judgment. The restriction of alteration or review beyond clerical or arithmetical errors is prohibited except unless

(i) it is so provided by the Code; or

(ii) it is otherwise so provided by any other law for the time being in force.

21. Hence, the restriction prescribed is saved by any substantive provision in any other law in force. The statutory restriction is thus made subject to such express provision. When the same is read in consonance with Section 147 of the Negotiable Instruments Act, 1881, it is evident that an overriding jurisdiction has been conferred by Section 147 of the Negotiable Instruments Act, 1881 to operate notwithstanding anything contained in Cr.P.C. The above Section also does not prescribe pendency of a proceeding to be a pre-requisite similar to as contained in Section 320(2) Cr.P.C. and instead confers an unqualified power of compounding on the Court. The non-obstante clause under Section 147 of the Negotiable Instruments Act, 1881 has to be thus read along with Section 362 Cr.P.C. to mean that the above bar/restriction would not apply to proceedings under the law.

22. The presence of the non-obstante clause is of decisive significance. It establishes a clear legislative intent to override all procedural limitations contained in the Code of Criminal Procedure, including those relating to the stage, manner or finality of proceedings. The legislature has consciously departed from the restrictive regime of Section 320 CrPC and vested courts with wide and flexible discretion to permit compounding so as to achieve the true object of the statute i.e. expeditious resolution of cheque dishonour disputes and restitution of the complainant.

23. Equally, the embargo contained in Section 362 of the Code of Criminal Procedure, 1973, which proscribes a criminal court from altering or reviewing its judgment once the same has been signed, cannot be so expansively or mechanically construed as to defeat the express legislative mandate embodied in Section 147 of the Negotiable Instruments Act, 1881. Section 362 CrPC is a general procedural provision, enacted with the limited object of preserving the finality and certainty of criminal adjudication and of preventing repeated reconsideration of judgments on merits. It was never intended to operate as an inflexible bar against the exercise of powers expressly conferred by a special statute, particularly one enacted subsequently and fortified by a non-obstante clause.

24. Section 147 of the NI Act, by employing the phrase “notwithstanding anything contained in the Code of Criminal Procedure, 1973”, overrides all procedural limitations under the CrPC, including those relating to the stage of proceedings or the technical finality of judgments. The principle of statutory interpretation is well settled that a special law prevails over a general law, and where the special law contains an overriding clause, the general provision must yield. To hold that Section 362 CrPC nullifies or curtails the power of compounding under Section 147 would be to render the non-obstante clause null and void and to frustrate the very object of the legislature.

25. More importantly, the act of permitting compounding under Section 147 does not partake the character of a “review” or “alteration” of the judgment on merits, as contemplated by Section 362 CrPC. The court does not sit in appeal over its earlier findings, nor does it reassess the evidence or correctness of the conviction. Compounding is a statutorily recognised legal consequence flowing from a voluntary and lawful settlement between the complainant and the accused, which the court is expressly empowered to acknowledge. The recognition of such a settlement does not undermine judicial finality; rather, it gives effect to a subsequent supervening event sanctioned by law, consistent with the restorative and compensatory spirit of the N.I. Act.

26. The same then leads to the scope of Section 482 Cr.P.C. (Section 528 of BNSS). The said clause empowers the Court to make such order as may be necessary to: -

(i) give effect to any order; or

(ii) to prevent abuse of process of Court; or

(iii) to otherwise secure the ends of justice.

27. Hence, the pre-dominant object for exercise of power is to secure the ends of justice.

28. The cases under of the Negotiable Instruments Act, 1881 thus would not strictly fall under the restriction provided as per Section 362 Cr.P.C. Hence, while ordinarily such a limitation would apply to proceedings arising under the IPC/BNS, the same rigour would not apply to proceedings under the of the Negotiable Instruments Act, 1881. The Court noticed as to what would essentially constitute review and held that where the facts remain the same, it would predominantly be a review but where material facts change, as may alter the final judgment, the same would not be the prohibitional scope of Section 362 Cr.P.C. Reference in this regard may be made to the judgment in the matter of State of Punjab Vs. Davinder Pal Singh Bhullar and others; 2012(1) RCR (Crl.) 126 (SC), which reads thus:-

“III. BAR TO REVIEW/ALTER- JUDGMENT

26. There is no power of review with the Criminal Court after judgment has been rendered. The High Court can alter or review its judgment before it is signed. When an order is passed, it cannot be reviewed. Section 362 Criminal Procedure Code is based on an acknowledged principle of law that once a matter is finally disposed of by a Court, the said Court in the absence of a specific statutory provision becomes functus officio and is disentitled to entertain a fresh prayer for any relief unless the former order of final disposal is set aside by a Court of competent jurisdiction in a manner prescribed by law. The Court becomes functus officio the moment the order for disposing of a case is signed. Such an order cannot be altered except to the extent of correcting a clerical or arithmetical error. There is also no provision for modification of the judgment. (See: Hari Singh Mann v. Harbhajan Singh Bajwa & Ors., 2000(4) RCR (Criminal) 650 ; and Chhanni v. State of U.P., 2006(3) RCR (Criminal) 753 : 2006(2) Apex Criminal 666).

Moreover, the prohibition contained in Section 362 Criminal Procedure Code is absolute; after the judgment is signed, even the High Court in exercise of its inherent power under Section 482 Criminal Procedure Code has no authority or jurisdiction to alter/review the same. (See: Moti Lal v. State of M.P., 1994(3) RCR (Criminal) 77 ; Hari Singh Mann (supra); and State of Kerala v. M.M. Manikantan Nair, 2001(2) RCR (Criminal) 657 ).

27. If a judgment has been pronounced without jurisdiction or in violation of principles of natural justice or where the order has been pronounced without giving an opportunity of being heard to a party affected by it or where an order was obtained by abuse of the process of court which would really amount to its being without jurisdiction, inherent powers can be exercised to recall such order for the reason that in such an eventuality the order becomes a nullity and the provisions of Section 362 Criminal Procedure Code would not operate. In such eventuality, the judgment is manifestly contrary to the audi alteram partem rule of natural justice. The power of recall is different from the power of altering/reviewing the judgment. However, the party seeking recall/alteration has to establish that it was not at fault. (Vide: Chitawan & Ors. v. Mahboob Ilahi, 1970 Crl.L.J. 378; Deepak Thanwardas Balwani v. State of Maharashtra & Anr., 1985 Crl.L.J. 23; Habu v. State of Rajasthan, AIR 1987 Rajasthan 83 (F.B.); Swarth Mahto & Anr. v. Dharmdeo Narain Singh, AIR 1972 Supreme Court 1300; Makkapati Nagaswara Sastri v. S.S. Satyanarayan, AIR 1981 Supreme Court 1156; Asit Kumar Kar v. State of West Bengal & Ors., 2010(8) RCR (Civil) 111 : (2009) 2 SCC 703; and Vishnu Agarwal v. State of U.P. & Anr.,2011(2) RCR (Criminal) 754 : 2011(2) Recent Apex Judgments (R.A.J.) 585 ).

28. This Court by virtue of Article 137 of the Constitution has been invested with an express power to review any judgment in Criminal Law and while no such power has been conferred on the High Court, inherent power of the court cannot be exercised for doing that which is specifically prohibited by the Code itself. (Vide: State Represented by D.S.P., S.B.C.I.D., Chennai v. K.V. Rajendran & Ors., 2008(4) RCR (Criminal) 278 : 2008(5) R.A.J. 355 ).

29. In Smt. Sooraj Devi v. Pyare Lal & Anr., AIR 1981 Supreme Court 736, this Court held that the prohibition in Section 362 Criminal Procedure Code against the Court altering or reviewing its judgment, is subject to what is "otherwise provided by this Code or by any other law for the time being in force". Those words, however, refer to those provisions only where the Court has been expressly authorised by the Code or other law to alter or review its judgment. The inherent power of the Court is not contemplated by the saving provision contained in Section 362 Criminal Procedure Code and, therefore, the attempt to invoke that power can be of no avail.

30. Thus, the law on the issue can be summarised to the effect that the criminal justice delivery system does not clothe the court to add or delete any words, except to correct the clerical or arithmetical error as specifically been provided under the statute itself after pronouncement of the judgment as the Judge becomes functus officio. Any mistake or glaring omission is left to be corrected only by the appropriate forum in accordance with law.

IV. INHERENT POWERS UNDER section 482 Criminal Procedure Code

31. The inherent power under Section 482 Criminal Procedure Code is intended to prevent the abuse of the process of the Court and to secure the ends of justice. Such power cannot be exercised to do something which is expressly barred under the Criminal Procedure Code If any consideration of the facts by way of review is not permissible under the Criminal Procedure Code and is expressly barred, it is not for the Court to exercise its inherent power to reconsider the matter and record a conflicting decision. If there had been change in the circumstances of the case, it would be in order for the High Court to exercise its inherent powers in the prevailing circumstances and pass appropriate orders to secure the ends of justice or to prevent the abuse of the process of the Court. Where there are no such changed circumstances and the decision has to be arrived at on the facts that existed as on the date of the earlier order, the exercise of the power to reconsider the same materials to arrive at different conclusion is in effect a review, which is expressly barred under Section 362 Criminal Procedure Code (See: Simrikhia v. Dolley Mukherjee and Chhabi Mukherjee & Anr, (1990) 2 SCC 437).

32. The inherent power of the court under Section 482 Criminal Procedure Code is saved only where an order has been passed by the criminal court which is required to be set aside to secure the ends of justice or where the proceeding pending before a court, amounts to abuse of the process of court. Therefore, such powers can be exercised by the High Court in relation to a matter pending before a criminal court or where a power is exercised by the court under the Criminal Procedure Code Inherent powers cannot be exercised assuming that the statute conferred an unfettered and arbitrary jurisdiction, nor can the High Court act at its whim or caprice. The statutory power has to be exercised sparingly with circumspection and in the rarest of rare cases. (Vide: Kurukshetra University & Anr. v. State of Haryana & Anr., AIR 1977 Supreme Court 2229; and State of W.B. & Ors. v. Sujit Kumar Rana, (2004) 4 SCC 129).

33. The power under Section 482 Criminal Procedure Code cannot be resorted to if there is a specific provision in the Criminal Procedure Code for the redressal of the grievance of the aggrieved party or where alternative remedy is available. Such powers cannot be exercised as against the express bar of the law and engrafted in any other provision of the Criminal Procedure Code Such powers can be exercised to secure the ends of justice and to prevent the abuse of the process of court. However, such expressions do not confer unlimited/unfettered jurisdiction on the High Court as the "ends of justice" and "abuse of the process of the court" have to be dealt with in accordance with law including the procedural law and not otherwise. Such powers can be exercised ex debito justitiae to do real and substantial justice as the courts have been conferred such inherent jurisdiction, in absence of any express provision, as inherent in their constitution, or such powers as are necessary to do the right and to undo a wrong in course of administration of justice as provided in the legal maxim "quando lex aliquid alique, concedit, conceditur et id sine quo res ipsa esse non potest". However, the High Court has not been given nor does it possess any inherent power to make any order, which in the opinion of the court, could be in the interest of justice as the statutory provision is not intended to by-pass the procedure prescribed. (Vide: Lalit Mohan Mondal & Ors. v. Benoyendra Nath Chatterjee, AIR 1982 Supreme Court 785 Rameshchandra Nandlal Parikh v. State of Gujarat & Anr., 2006(1) RCR (Criminal) 675 : 2006(1) Apex Criminal 224 ; Central Bureau of Investigation v. Ravi Shankar Srivastava, IAS & Anr., 2006(3) Apex Criminal 65 Inder Mohan Goswami & Anr. v. State of Uttaranchal & Ors., 2007(4) RCR (Criminal) 548 : 2007(5) R.A.J. 451 and Pankaj Kumar v. State of Maharashtra & Ors., 2008(4) RCR (Criminal) 890 : 2008(6) R.A.J. 293 ).

xxx xxx xxx

40. It is evident from the above that inherent powers can be exercised only to prevent the abuse of the process of the court and to secure the ends of justice. However, powers can be used provided there is no prohibition for passing such an order under the provisions of Criminal Procedure Code and there is no provision under which the party can seek redressal of its grievance. Under the garb of exercising inherent powers, the Criminal Court cannot review its judgment. Such powers are analogous to the provisions of Section 151 Civil Procedure Code and can be exercised only to do real and substantial justice. The rule of inherent powers has its source in the maxim "Quadolex aliquid alicui concedit, concedere videtur id sine quo ipsa, ess uon potest" which means that when the law gives anything to anyone, it gives also all those things without which the thing itself could not exist. The order cannot be passed by-passing the procedure prescribed by law. The court in exercise of its power under Section 482 Criminal Procedure Code cannot direct a particular agency to investigate the matter or to investigate a case from a particular angle or by a procedure not prescribed in Criminal Procedure Code Such powers should be exercised very sparingly to prevent abuse of process of any court. Courts must be careful to see that its decision in exercise of this power is based on sound principles.

To inhere means that it forms a necessary part and belongs as an attribute in the nature of things. The High Court under Section 482 Criminal Procedure Code is crowned with a statutory power to exercise control over the administration of justice in criminal proceedings within its territorial jurisdiction. This is to ensure that proceedings undertaken under the Criminal Procedure Code are executed to secure the ends of justice. For this, the Legislature has empowered the High Court with an inherent authority which is repository under the Statute. The Legislature therefore clearly intended the existence of such power in the High Court to control proceedings initiated under the Criminal Procedure Code Conferment of such inherent power might be necessary to prevent the miscarriage of justice and to prevent any form of injustice. However, it is to be understood that it is neither divine nor limitless. It is not to generate unnecessary indulgence. The power is to protect the system of justice from being polluted during the administration of justice under the Code. The High Court can intervene where it finds the abuse of the process of any court which means, that wherever an attempt to secure something by abusing the process is located, the same can be rectified by invoking such power. There has to be a nexus and a direct co- relation to any existing proceeding, not foreclosed by any other form under the Code, to the subject matter for which such power is to be exercised.

Application under Section 482 Criminal Procedure Code lies before the High Court against an order passed by the court subordinate to it in a pending case/proceedings. Generally, such powers are used for quashing criminal proceedings in appropriate cases. Such an application does not lie to initiate criminal proceedings or set the criminal law in motion. Inherent jurisdiction can be exercised if the order of the Subordinate Court results in the abuse of the "process" of the court and/or calls for interference to secure the ends of justice. The use of word 'process' implies that the proceedings are pending before the Subordinate Court. When reference is made to the phrase "to secure the ends of justice", it is in fact in relation to the order passed by the Subordinate Court and it cannot be understood in a general connotation of the phrase. More so, while entertaining such application the proceedings should be pending in the Subordinate Court. In case it attained finality, the inherent powers cannot be exercised. Party aggrieved may approach the appellate/revisional forum. Inherent jurisdiction can be exercised if injustice done to a party, e.g., a clear mandatory provision of law is overlooked or where different accused in the same case are being treated differently by the Subordinate Court.

An inherent power is not an omnibus for opening a pandorabox, that too for issues that are foreign to the main context. The invoking of the power has to be for a purpose that is connected to a proceeding and not for sprouting an altogether new issue. A power cannot exceed its own authority beyond its own creation. It is not that a person is remediless. On the contrary, the constitutional remedy of writs are available. Here, the High Court enjoys wide powers of prerogative writs as compared to that under Section 482 Criminal Procedure Code To secure the corpus of an individual, remedy by way of habeas corpus is available. For that the High Court should not resort to inherent powers under Section 482 Criminal Procedure Code as the Legislature has conferred separate powers for the same.  Needless to mention that Section 97 Criminal Procedure Code empowers Magistrates to order the search of a person wrongfully confined. It is something different that the same court exercising authority can, in relation to the same subject matter, invoke its writ jurisdiction as well. Nevertheless, the inherent powers are not to provide universal remedies. The power cannot be and should not be used to belittle its own existence. One cannot concede anarchy to an inherent power for that was never the wisdom of the Legislature. To confer un-briddled inherent power would itself be trenching upon the authority of the Legislature.”

(emphasis supplied)

Reference also needs to be made to the judgment of the Supreme Court in the matter of Mostt. Simrikhia Vs. Smt. Dolley Mukherjee, 1990(2) RCR (Crl.) 337 which reads thus: -

“3. The learned counsel for the appellant contended before us that the second application under section 482 Criminal Procedure Code, 1973 was not entertainable, the exercise of power under section 482, on a second application by the same party on the same ground virtually amounts to the review of the earlier order and is contrary to the spirit of section 362 of the Criminal Procedure Code and the High Court was, therefore, clearly in error in having quashed the proceedings by adopting that course. We find considerable force in the contention of the learned counsel. The inherent power under section 482 is intended to prevent the abuse of the process of the Court and to secure ends of justice. Such power cannot be exercised to do something which is expressly barred under the Code. If any consideration of the facts by way of review is not permissible under the Code and is expressly barred, it is not for the Court to exercise its inherent power to reconsider the matter and record a conflicting decision. If there had been change in the circumstances of the case, it would be in order for the High Court to exercise its inherent powers in the prevailing circumstances and pass appropriate orders to secure the ends of justice or to prevent the abuse of the process of the Court. Where there is no such changed circumstances and the decision has to be arrived at on the facts that existed as on the date of the earlier order, the exercise of the power to reconsider the same materials to arrive at different conclusion is in effect a review, which is expressly barred under section 362.

4. In the present case, there had been a definite finding that the complaint was taken cognizance of by the Magistrate before he transferred the proceedings under section 192(2) for enquiry under section 202 Criminal Procedure Code, 1973 This finding has been arrived at after perusal of the record of the proceedings before the Magistrate and on a consideration of the report of the concerned Magistrate. A reappraisal of the facts on record to determine whether such cognizance had been taken of in a subsequent proceeding is not, therefore, warranted. The only ground on which relief was claimed is the alleged irregularity in the transfer of the proceedings. It was not open to the parties to reagitate the question by a fresh application nor was the court empowered under section 482 to reconsider the matter.”

(emphasis supplied)

29. Hence, a question cannot be re-agitated on the same facts, calling for re-appraisal as the same would be a substantive review.

30. The resolution of the dispute, in entirety, is the finest hour of justice and the judicial system has supported and promoted settlements. The procedural laws are hand maiden of justice and should not be deployed rigidly only to add burden of litigation on an over-loaded system. The end consumer of justice should not ordinarily be exposed to procedural harassment unless such procedural non-compliance violates rights of the other.

31. Upon consideration of the submissions advanced, including the assistance rendered by the learned amicus curiae and upon a careful examination of the statutory scheme and the authoritative pronouncements of the Hon’ble Supreme Court and other High Courts, I am of the opinion that an offence punishable under Section 138 of the Negotiable Instruments Act, 1881 is amenable to compounding at any stage of the proceedings, including after conviction, during appeal or revision and even subsequent to the dismissal thereof, provided the settlement between the parties is voluntary, lawful and bona fide.

32. The object and purpose underlying the NI Act, particularly post-2002 amendments, further fortify this conclusion. Cheque dishonour cases are predominantly compensatory in nature. The penal provision is intended as a deterrent to ensure the credibility of negotiable instruments and the smooth functioning of commercial transactions and not as a means of retributive incarceration. Once the monetary liability stands discharged, the continuation of criminal proceedings would neither advance public interest nor subserve the ends of justice. On the contrary, it would frustrate the very legislative policy of de-clogging courts and encouraging early resolution of commercial disputes.

33. Hon’ble Supreme Court vide judgment dated 11.08.2025 in the case of Gian Chand Garg v Harpal Singh & Anr. has held that although dishonour of a cheque entails criminal consequences, the legislature, by enacting Section 147 of the Negotiable Instruments Act, has expressly rendered such offences compoundable notwithstanding the provisions of the Code of Criminal Procedure, and that compounding is permissible at any stage of the proceedings, particularly where the parties have voluntarily resolved their dispute. The relevant extract thereof is as under: -

“10. Therefore, it is very clear that although dishonour of cheque entails criminal consequence, the legislature by virtue of section 147 of the NI Act has made it compoundable notwithstanding the provisions of the Code of Criminal Procedure, 1973 and the same can be compounded at any stage of the proceedings especially when the parties have themselves arrived at a voluntary compromise.

11. In the present case, the compromise deed dated 06.04.2025 and the Affidavit on behalf of the Respondent No.1 dated 16.04.2025 is annexed to the present petition as Annexure P3 and P6, respectively. Upon careful perusal of the recitals contained in the said documents, it clearly emerges that the Respondent No.1 in consideration of Two Demand Drafts bearing no(s). 004348 dated 04.04.2025 and 004303 dated 11.02.2025 for Rs. 2.5 lakhs each along with three cheques bearing no(s). 354412 dated 10.05.2025, 354413 dated 10.06.2025 and 354414 dated 10.07.2025 of Rs. 1 lakh each has arrived at a compromise with appellant without any coercion and at his own will and voluntarily. Once the complainant has signed the compromise deed accepting the amount in full and final settlement of the default sum the proceedings under Section 138 of the NI Act cannot hold water, therefore, the concurrent conviction rendered by the Courts below has to be set-aside.

12. Therefore, in the light of aforesaid discussion, we are of the considered view that the present appeal deserves to be allowed. Accordingly, the same stands Allowed and consequently the impugned order dated 27.03.2025 in CRR 2563 of 2025 is set aside and the order of conviction and sentence imposed on appellant is quashed.”

34. Thus, the aforesaid elucidation of Section 147 leaves no scope for ambiguity. The finality of proceedings is subordinate to the mandate of complete justice in cheque dishonour matters. The power to permit compounding is not exhausted merely because a revision petition has been dismissed or a judgment has attained technical finality. To hold otherwise would be to elevate procedural form over substantive justice and to defeat the salutary object of the enactment.

35. In view of the aforesaid discussion, the present application is allowed and the offence is permitted to be compounded under Section 147 of the Negotiable Instruments Act, 1881 read with Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023. Consequently, the order dated 13.07.2022 passed in CRR No. 1436 of 2022 is hereby recalled, and the order of conviction and sentence dated 08.08.2018 passed by the learned Chief Judicial Magistrate, Sri Muktsar Sahib, as also the appellate order dated 03.03.2022 passed by the learned Additional Sessions Judge, Sri Muktsar Sahib, are set aside and quashed.

Application allowed.

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