1 ( 2026:HHC:38858 ) IN THE HIGH COURT OF HIMACHAL PRADESH AT SHIMLA Cr. Revision No.425 of 2025 Decided on 11.09.2026 Guman Singh …Petitioner Versus H.P. State Co-operative Bank Ltd. …Respondent Coram Hon’ble Mr. Justice Chirag Bhanu Singh, Judge. 1Whether approved for reporting? For the petitioner: Ms. Archana Dutt, Advocate. For the respondent: None. Chirag Bhanu Singh, Judge (Oral) By way of present revision, the petitioner has assailed his conviction and sentence passed by the learned Judicial Magistrate First Class, Rajgarh, District Sirmaur, H.P., vide order dated 28.02.2024, whereby the petitioner stands convicted to undergo simple imprisonment for a period of one year and to pay fine/compensation amount to tune of Rs.7,25,000/- for having committed an offence punishable under Section 138 of the Negotiable Instruments Act (NI Act), which has been duly affirmed in appeal by the learned Sessions Judge, Sirmaur District at Nahan, H.P., vide judgment dated 22.04.2025. 2 ( 2026:HHC:38858 ) 2. In brief, the genisis leading to the complaint was that the accused/petitioner had obtained a loan for the sum of Rs.4,25,000/- for the purposes of running his business, in the year 2013, which was sanctioned and the same has to be repaid as per the terms and conditions of the agreement. In order to regularise the loan account, the accused/petitioner had issued a post dated cheque bearing No.109201, dated 28.01.2016 to the tune of Rs.5,15,521/-. The respondent- complainant had presented the same with its bankers, i.e. H.P. State Cooperative Bank, Branch Rajgarh, Sirmaur, H.P., which unfortunately was returned unpaid and dishonoured with remarks “Insufficient Funds”. 3. The complainant-Bank having appraoched the learned trial Court resulted into the aforeaid conviction and sentence. In appeal too, the conviction was upheld. The learned Courts below after due deliberations sentenced the accused/petitioner and imposed the substantive sentence referred above and hence the present revision petition. 4. I have heard learned counsel for the parties and gone through the record carefully. 3 ( 2026:HHC:38858 ) 5. The petitioner-accused has paid the entire amount to the complainant/respondent. There is no subsisting liability remaining and hence, the respondent-complainant Bank does not thus intend to proceed any further in the matter. 6. Seemingly, the parites have now burried the hatchet. The learned counsel for the respondent-complainant also submits that the entire cheque amount has been received by the respondent-complainant. 7. The learned counsel for the petitioner submits that since the parties had agreed to settle the matter in full and final settlement of the claim, the petition deserves to be allowed and the petitioner is entitled to be acquitted and released. 8. Hon’ble Supreme Court, in case titled as “K.M. Ibrahim versus K.P. Mohammed and another, 2010 (1) SCC 798." has categorically gone on to hold that the offences under Section 138 of the N.I. Act, can be allowed to be compounded even at the appellate stage. 9. The said view has been consistently followed from the year 2004, starting with Anil Kumar Haritwal versus 4 ( 2026:HHC:38858 ) Alka Gupta, reported in 2004 (4) SCC 366, in a series of judgments till K.M. Ibrahim’s case referred hereinabove (supra). 10. It would be apposite to reproduce para-9 of the K.M, Ibrahim’s case, which reads as under:- “9. The golden thread in all these decisions is that once a person is allowed to compound a case as provided for under Section 147 of the Negotiable Instruments Act, the conviction under Section 138 of the said Act should also be set aside. In the case of Vinay Devanna Nayak (supra), the issue was raised and after taking note of the provisions of Section 320 Cr.P.C., this Court held that since the matter had been compromised between the parties and payments had been made in full and final settlement of the dues of the Bank, the appeal deserved to be allowed and the appellant was entitled to acquittal. Consequently, the order of conviction and sentence recorded by all the courts were set aside and the appellant was acquitted of the charge leveled against him.” 11. The Hon’ble Supreme Court thus, has categorically gone on to hold that Section 147 of the N.I. Act, does not in any way bar the parties from compounding an offence under the provisions of Section 138 of the N.I. Act, even at the appellate stage of the proceedings. 12. Thus, keeping in view the aforesaid judgment and facts and circumstances discussed herein-above (supra), the parties having indeed buried their differences, the matter 5 ( 2026:HHC:38858 ) having been compromised and the entire cheque amount having been paid to the respondent, in full and final settlement of the claim, the parties are allowed to compound the offence and as a sequel, the judgments of the learned Courts below, are quashed and set-aside. The accused is acquitted of the charges. Ordered accordingly. 13. The petition is disposed of accordingly, so also the pending application(s), if any. (Chirag Bhanu Singh) Judge 11th September, 2026 (Ritu)