Extending Probation of Offenders Act benefit in Section 138 NI Act cases upon settlement and payment.

The applicant was originally convicted by the 2nd Additional Chief Judicial Magistrate, Himmatnagar, in Criminal Case No. 859 of 2011 for an offence under Section 138 of the Negotiable Instruments Act

He was sentenced to one year of simple imprisonment and ordered to pay compensation of Rs. 5,30,000

This conviction was upheld by the 2nd Additional Sessions Judge, Himmatnagar, on 03.03.2017

The applicant approached the High Court in revision.

During the proceedings, the respondent-complainant confirmed that the settlement amount had been received and the dispute was settled

1. Whether the concurrent findings of the lower courts should be interfered with in revisional jurisdiction when the underlying debt has been settled

2. Whether the benefit of the Probation of Offenders Act, 1958, can be extended to an accused convicted under Section 138 of the Negotiable Instruments Act following a settlement

Section 138 of the Negotiable Instruments Act, noting that the provision is quasi-criminal and compoundable, intended to ensure the credibility of cheques rather than seek retribution

Section 4 of the Probation of Offenders Act, 1958, which allows for the release of offenders on probation of good conduct

Supreme Court precedent in Sanjabij Tari v. Kishore S. Borcar, 2025 INSC 1158, which supports maintaining a conviction while extending the benefit of probation when restitution is made

The Court observed that in revisional jurisdiction, it is not permissible to re-analyse or re-interpret evidence unless there is a patent perversity in the lower courts' findings

Given the concurrent findings of the trial and appellate courts, the Court found no ground to upset the conviction

The Court highlighted that the primary object of Section 138 of the NI Act is to ensure the payment of money

Since the complainant acknowledged receipt of the settlement amount, the Court determined that incarceration was unnecessary

Aligning with the Supreme Court’s direction in Sanjabij Tari, the Court balanced the legal requirement of maintaining the conviction with the equitable outcome of the settlement by substituting the custodial sentence with a period of probation

The applicant was directed to be released on probation of good conduct under Section 4 of the Probation of Offenders Act for a period of one year

This release is subject to the execution of a probation bond of Rs. 20,000 with one surety of a like amount before the trial court within 15 days

The revision application was disposed of with a caveat allowing the complainant to revive proceedings in case of any defect