Case BriefsHigh Courts

Chhattisgarh High Court: Rajendra Chandra Singh Samant, J., while addressing a petition made an observation with regard to matrimonial disputes that,

“…in a matrimonial dispute, the cause of action can arise again and again, even if the dispute is settled and compromised before the court and the case has been withdrawn.”

Present matter pertained to the quashing of an order passed by the Family Court, Bilaspur in a Civil Suit.

Petitioners’ counsel submits that respondent had filed a civil suit under Section 9 of the Hindu Marriage Act, 1955 and during the pendency, it was placed before the National Lok Adalat and as the respondent did not want to press on the said proceedings, it was disposed of.

Respondent in the present matter has filed a repeat application under Section 9 of the Hindu Marriage Act. Petitioner challenged the maintainability of the civil suit under Order 7 Rule 11 read with Section 23 Rule 4 of CPC on the ground that the previous application filed by the respondent had been disposed of by award.

Order 23 Rule 4 of CPC specifically provides about the abandonment of a suit under sub-rule 1 without permission of Court.

Further, it has been submitted that Section 21 of the Legal Services Authorities Act, 1987 provides that any award passed in the Lok Adalat shall be final and binding on all the parties and no appeal shall lie to any court against the award, hence in view fo the said the repeat application filed by the respondent stands unsustainable.

Respondent’s Counsel submitted that since the petitioner did not honour the ut of court compromise, respondent was compelled to file an application under Section 9 of the HMA, 1955.

Bench on perusal of the submissions and facts stated that under Section 21 of the Legal Services Authorities Act, 1987, an award of Lok Adalat shall be deemed to be a decree of a civil court which includes the order on compromise or settlement between the parties before the Lok Adalat.

Court stated that Lok Adalat has no authority to exercise the power under Order 23 Rule 1 of CPC. The Lok Adalat on taking cognizance in any matter referred to it from a court, can act only in accordance with Section 20 sub-section 4, 5 & 6 of the Act, 1955 and there is no mention that the Lok Adalat can allow the withdrawal of the civil suit.

Hence the Lok Adalat’s order having lo legality is not an order at all.

“the case of the respondent against the petitioner was terminated on the basis of the statement made by the respondent side, that some agreement has taken place between the parties out of the court.”

Court added that, in a matrimonial dispute, the cause of action can arise again and again, even if the dispute is settled and compromised before the court and the case has been withdrawn.

Therefore,

When a dispute crops up again at any subsequent stage on account of differences between the parties to the matrimony, that would be a separate cause of action, on which the party aggrieved, has an entitlement to maintain legal proceeding under the provision of the Hindu Marriage Act, 1955.

In view of the above, the petition was dismissed. [Harsha Dewani v. Ashutosh Gupta, 2020 SCC OnLine Chh 149, decided on 10-08-2020]

Op EdsOP. ED.

Interest republicae ut sit finis litium, meaning it is in the interest of the State that there should be an end to litigation. In pursuance of this objective, the Indian legal regime adopted various alternative forms of adjudicatory mechanism. The capital market regulator, Securities and Exchange Board of India (hereinafter referred as ‘SEBI’) introduced the consent mechanism efficacy of which has been discussed in this article.

Concept

The Code of Civil Procedure, 1908 and the Criminal Procedure Code, 1973 enumerate concepts of ‘compromise’ and ‘compounding of offences’ respectively. Similarly, under Section 15-JB[1] of the Securities and Exchange Board of India Act, 1992 is vested with the power to settle cases of securities law violation in the capital market. The idea was adopted from the success of its US counterpart, the Securities and Exchange Commission. Initially, the consent mechanism was proposed vide circular, Circular No. EFD/ED/Cir-1/2007 that enumerated the Guidelines for Consent Orders, introduced in 2007. The mechanism has evolved over the past years to take the form of the Settlement Regulations, 2018.[2]

The consent mechanism may be defined as “a proceeding in which the regulator and the alleged violator, may at any stage of the proceeding negotiate a settlement in lieu of administrative/civil proceeding, in the process saving cost, time and efforts for the parties involved. The mechanism does not require admission or denial of findings.”

Interpreting settlement orders

To test the proposition in respect of the success of this mechanism, a few cases of settlement have been analysed. The vital question that arises is “Where the interest of investors is at stake, is settlement a viable solution?”

The recent settlement order passed by SEBI in the matter of HDFC AMC (hereinafter referred to as ‘the applicant’) provides insight to the above question. The applicant was served with a show-cause notice for violation of the SEBI (Mutual Funds) Regulations, 1996.  The applicant had invested in the debt instruments of Essel group of companies through its various mutual fund schemes. As per the show-cause notice, the investment made did not adhere to the (Mutual Funds) Regulations, 1996 as it failed to maintain proper due diligence that led to the loss of the unit-holders. In furtherance of the notice, the applicant filed a settlement application with SEBI and the High Powered Committee (constituted under the Settlement Regulations, 2018) agreed to settle the matter. As a part of the settlement terms, the applicant ensured that the unit-holders were compensated along with redressal of their complaints. Further, it was agreed that the settlement amount would be paid by the funds of the applicant.

Certainly, the above order was in the interest of the investors and the regulator. The alleged violations were committed in May 2019, and within a span of a year, the settlement process has been concluded. Settlement in the present case indeed served as an expeditious solution contrary to the prolonged administrative/legal proceedings.

One major concern that has hindered the growth of the settlement mechanism is the conundrum surrounding the settlement of serious offences like insider trading and fraudulent unfair trade practices. It is pertinent to note here that such offences were a part of the initial guidelines issued under the circular in 2007. Subsequently, the amended Settlement Regulations, 2014 removed serious offences based on the severity of such offences. However, the Committee set up under the chairmanship of Justice Dave that drafted the Settlement Regulations, 2018, undertook an alternative approach by vesting discretion with the Board to decide based on facts and circumstances of each case than make it principle based by creating an absolute bar to settle such offences.

The question that requires attention is that “Has the discretion vested with the Board regarding the nature of offences to be settled been exercised wisely by it?”

On observation of previously adjudicated cases that have been settled, it was noticed that only those cases where market interests and market impact was limited and loss to the investors was minuscule, were taken through the settlement route. In  Abhay Gandhi and Kiran Abhay Gandhi, the CEO of Ranbaxy Laboratories Limited, was charged under the  Prohibition of Insider Trading Regulations, 2015[3] for selling shares while in possession of Unpublished Price Sensitive Information, the matter was settled by remitting an amount of Rs Thirty-five lakhs, that would have been evaluated considering the profit made by the applicants, the multiplier for deciding penalty as provided in  Chapter VI[4] of the Settlement Proceedings Regulations, 2018.    

Settlement – An Antidote to Litigation?

On considering the above proposition, it raises two further questions.

1. Will SEBI in all cases allow the settlement process?

2. Is the settlement mechanism a full proof mechanism where the interests of SEBI, stakeholders and investors can be balanced?

To answer the former, the essential grounds for the basis of the settlement are laid down exhaustively under the purview of Regulation 10 of the Settlement Regulations, 2018. The Board established under Section 5 of the Act may reject matters for settlement that have a wide impact on investors, are repetitive in their defaults or the person making the application is a wilful defaulter. SEBI has adopted a stringent approach in accepting applications for Consent Orders. For instance, NSE was alleged to have deals with brokers and unduly favouring and assisting them in unauthorised trading, and it applied for settlement. SEBI rejected the NSE settlement application and ordered disgorgement by asking them to pay over INR 1000 Crores.

After the infamous IL&FS scam where credit rating agencies were under the scanner for not changing the credit rating of the instruments before the default, SEBI based on a reasoned order categorically stated that the matter involved wide market impact including an adverse effect on the interest of the investors thereby questioned the integrity of the market, and rejected ICRA’s application for settlement.   

To answer the latter, no mechanism can be a panacea, it comes with its fragilities. In the author’s opinion, the biggest drawback of this mechanism is that it may undermine the problem which may in a certain point of time be the tip of the iceberg. To illustrate, in the case of Yes Bank, it was charged for violating the disclosure norms prescribed in Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, that required the disclosure of material information.

Yes Bank as per the settlement order made selective disclosure of divergence and partially concealed the report the issued by RBI and its settlement then, concluded the matter but all those along with a gamut of other issues including a liquidity crisis and failure of the corporate governance bounced back together and led to its collapse. Therefore, in certain cases, it may not be possible for the regulator to see through and understand the actual reasons behind the violation, divergence. 

The way ahead

The increasing role of the consent mechanism can be witnessed from the fact that an average of ten settlement orders were passed in the year 2019. It is evident that the Settlement Regulations, 2019 have ushered a fresh air in the arena of ‘Consent Orders’. Certain key features of the regulations are that transparency is ensured by vesting limited discretion with the Board. The penalty payable by the applicant is derived based on a comprehensive multiplier on consideration of the number of defaults, the stage of proceedings along with the stage at which settlement is introduced. It will not be a misnomer to say that capital market regulations in India have evolved tremendously along with the market and provided an effective adjudication process that serves the need of the hour. In cases where all three chords of prompt action, investor interest, and effective enforcement are struck, it is only then the underlying objective of consent orders will be achieved in its essence.


*Legal professional, with an avid interest in Securities Law and previously worked with KPMG as a part of the Forensic Investigation Team.

[1] Section 15-JB, Securities and Exchange Board of India Act, 1992    

[2] Securities and Exchange Board of India (Settlement Proceedings) Regulations, 2018

[3] The SEBI (Prohibition of Insider Trading) Regulations, 2015 

[4] Ch. VI, SEBI (Settlement Proceedings) Regulations, 2018  

Case BriefsHigh Courts

Rajasthan High Court: Vijay Bishnoi, J., allowed a criminal revision petition seeking to set aside judgments convicting the petitioner with regard to offences under the Negotiable Instruments Act. 

In the present case, the petitioner being aggrieved by the orders of the trial court and the appellate court wherein he was convicted for an offence under Section 138 of the Negotiable Instruments Act, 1881 (“NI Act”) has filed this criminal revision petition. 

Learned counsel representing the petitioner, Umesh Shrimali submitted that in view of the fact that the parties have entered into a compromise, the impugned orders under challenge may be set aside and the petitioner may be acquitted from the charges.

The public prosecutor representing the respondent, Laxman Solanki submitted that the respondent has agreed to the compromise entered into and it does not want to press any charges for the offence punishable under the NI Act.

The Court perused Section 147 of the NI Act and stated that every offence punishable under the Act is compoundable hence the impugned orders are set aside and the criminal revision petition is set aside. However, the Court upon placing reliance on the Supreme Court judgment Damodar S. Prabhu v Sayed Babalal H, (2010) 5 SCC 663 and directed the petitioner to submit 15% of the cheque amount by way of the cost before the Legal Services Authority. [Jasmel Singh v. State of Rajasthan,2020 SCC OnLine Raj 334, decided on 03-03-2020]

Case BriefsHigh Courts

Rajasthan High Court: The Division Bench comprising of Narendra Singh Dhaddha and Mohammad Rafiq, JJ. allowed a decree of divorce which was filed through a joint application under Section 13 B(1) of the Hindu Marriage Act, 1955.

In the present case, a joint application was filed by the husband and wife under Section 13B (1) of HMA, for dissolution of their marriage. Along with this, they also filed an application under Section 13B (2) of the Hindu Marriage Act, 1955 for waiver of the cooling-off period.

Further, the above was filed in the family court and dismissed thereafter. Hence the present appeal has been filed challenging the said order.

Parties stated that the marriage could not be consummated fro inability of the husband and there is absolutely no possibility of the parties living together. In such circumstances, they both started living separately and decided to obtain a decree of divorce.

Counsel on behalf of the parties submitted that the application filed under Section 13 B (1) of the stated Act clearly mentions that the parties have been living separately from last more than 1 year. Further, it has been stated in the application that, wife received all her ‘stridhan’ and dowry articles along with a sum of Rs 15, 00,000 as permanent alimony.

In order to support the above submission, counsel relied on the Judgments of the Supreme Court in Veena v. State (Govt. of NCT, Delhi) (2011) 14 SCC 614; Devinder Singh Narula v. Meenakshi Nangia, (2012) 8 SCC 580 and Amardeep Singh v. Harveen Kaur, (2017) 8 SCC 746.

The High Court, on noting the submissions of the parties along with keeping in view the facts and circumstances of the case, stated that, the compromise arrived between the parties persuaded the court to allow the said appeal and therefore the marriage is to be dissolved with immediate effect.[Sachin Gupta v. Ram Kumari Gupta, 2019 SCC OnLine Raj 2402, decided on 22-08-2019]

Case BriefsHigh Courts

Punjab and Haryana High Court: Rajbir Sehrawat, J. quashed the FIR after the parties entered into the compromise as same was held to be done with the free consent and without any pressure.

A petition was filed under Section 482 of Code of Criminal Procedure, 1973 for quashing the FIR and all consequential proceedings as parties have entered into compromise against the offence committed under Section 420 of the Penal Code, 1860.

A report was received from the Judicial Magistrate in which it had been noticed that the matter has been compromised with the intervention of respectable and friends of both the parties, compromise has been affected with their free consent and without any pressure or undue influence from any quarter.

High Court while allowing the petition discussed resolving the civil and criminal dispute by giving absolute freedom to the parties to settle their dispute by compromise with certain legal consequences. The court with regard to the compromised in criminal cases said that In criminal cases as tend to cast their effect and consequences even upon the society at large. Therefore, the law prescribes punishment, severe punishments and extreme punishments, including the death penalty for criminal acts. The criminal law provides for the compromise between the parties under Section 320 of the Code of Criminal Procedure, 1973 which permits compounding even at the appellate and revisional stage but this section relates only to the offences prescribed under the Indian Penal Code. For other offences the power lies with the High Court in order to maintain the sanctity of the procedure prescribed for a criminal trial.

Further, the Court also put forth the case of Gian Singh v. State of Punjab, (2012) 10 SCC 303 in which the Supreme Court had amply clarified the legal position in recognizing the position of compromise. The court in the above mentioned case held that the High Court must consider whether it would be unfair or contrary to the interest of justice to continue with the criminal proceeding or continuation of the criminal proceeding would tantamount to abuse of process of law despite settlement and compromise between the victim and wrongdoer and whether to secure the ends of justice, it is appropriate that criminal case is put to an end and if the answer to the above question(s) is in affirmative, the High Court shall be well within its jurisdiction to quash the criminal proceeding.”

Thus the Court held that no useful purpose would be served by keeping the proceedings alive. It will be in the interest of justice, if the settlement reached between the parties is accepted.[Harmesh Singh v. State of Punjab, 2019 SCC OnLine P&H 1322, decided on 29-07-2019]

Case BriefsHigh Courts

Punjab and Haryana High Court: Hari Pal Verma, J. quashed the criminal proceeding as there was a compromise signed between the parties.

A petition was filed under Section 482 of the Code of Criminal Procedure, 1973 for quashing the FIR registered under Sections 406, 498-A of the Penal Code, 1860.

The records of the case are such that the parties appeared before the Judicial Magistrate 1st Class in which it was submitted that compromise was effected between the parties voluntarily without any coercion or undue influence. The complainant/respondent made a joint statement in which she had made the statement regarding the compromise between the two.

Gaganpreet Kaur, counsel for State had not disputed the fact of the compromise between the parties.

The Court thus opined that no useful purpose would be served to continue with the proceedings before the trial court. The Court reiterated the case of Gold Quest International (P) Ltd. v. State of T.N., 2014 (4) RCR (Criminal) 206, in which the Supreme Court held that “disputes which are substantially matrimonial in nature, or the civil property disputes with criminal facets, if the parties have entered into settlement, and it has become clear that there are no chances of conviction, there is no illegality in quashing the proceedings under Section 482 CrPC read with Article 226 of the Constitution.” Thus, all the proceeding was quashed qua the petitioner on the basis of the compromise entered between the parties.[Pankaj v. State of Haryana, 2019 SCC OnLine P&H 1112, decided on 04-07-2019]

Case BriefsHigh Courts

Punjab and Haryana High Court: A Bench of Arvind Singh Sangwan, J., quashed the FIR on the basis of the compromise entered into by the parties.

A petition was filed by the petitioner for quashing the FIR for the offences punishable under Sections 377, 34 of Penal Code, 1908 and all the subsequent proceedings arising therefrom.  The ground for quashing the FIR mentioned was with respect to the compromise entered by the party. The Court revealed that they have voluntarily entered into a compromise and the Court is satisfied that the parties have amicably settled their dispute without any fear, pressure, threat or coercion and out of their free will. Hence the Application for quashing of FIR was filed.

The Learned counsel for the petitioner, Piyush Sharma, submitted apart from the amicable settlement between the parties there was no other criminal case pending and none of the petitioners is a proclaimed offender. Reliance was placed upon the case of Navtej Singh Johar v. Union of India, (2018) 10 SCC 1.

The Learned counsel for the respondent, M.S. Nagra, has not disputed the fact that the parties have arrived at a settlement with intent to give burial to their differences.

The Court after noting the submissions of both the parties held that “since the parties have arrived at a compromise and have decided to live in peace, no useful purpose would be served in allowing the criminal proceedings to continue.”[Pipal Singh v. State of Punjab, 2019 SCC OnLine P&H 450, decided on 29-04-2019]

Case BriefsHigh Courts

Punjab and Haryana High Court: This petition was filed before the Bench of Jaishree Thakur, J., under Section 482 of Criminal Procedure Code invoking the inherent power of High Court seeking quashing of FIR registered under Sections 498-A, 406, 323, 506 and 34 of Penal Code and all subsequent proceedings arising therefrom on the basis of compromise entered between the parties.

Facts of the case were that the respondent was married with petitioner and out of this wedlock, a child was born. However, temperamental differences arose between the husband and wife and FIR was registered by respondent. But the same was compromised between the two with the intervention of respectable persons. It was submitted before the Court that their statements were recorded in support of the compromise. In pursuance of which a report was received from the Judicial Magistrate (First Class) stating that the compromise was done without any pressure or coercion from anyone. DAG, Haryana had admitted before the Court that the parties had settled their dispute and had no objection to the quashing of the FIR.

High Court was of the view that a decision which is based on compromise causes no loss to any party rather it would bring peace and harmony between the parties to a dispute and restore tranquility in the society. In the light of nature of offence alleged and compromise entered between the parties continuing the prosecution was considered futile. Therefore, this petition was allowed and FIR was quashed. [Vikas Khatri v. State of Haryana, CRM-M-38284-2017 (O&M), decided on 01-08-2018]

Case BriefsHigh Courts

Uttaranchal High Court: The Bench of Narayan Singh Dhanik J. disposed a compounding application along with a criminal writ petition and quashed the First Information Report filed against the accused applicant on the ground of amicable settlement of the dispute between the parties.

The instant application had been filed for quashing FIR registered against the applicant under Sections 406, 420, 467, 468 and 471 of the Indian Penal Code. The accused-applicant and respondent-complainant entered into a compromise whereby the loss suffered by respondent was duly compensated and dispute between both the parties had been amicably settled. The complainant had no grudge or grievance against the accused-applicant and hence he was not interested in further prosecution.

The Court observed that though the complainant can be permitted to enter into the compromise for offences under Sections 406 and 420 IPC, but for the offences under Sections 467, 468 and 471 IPC, the complainant has no right to enter into a compromise with the accused. However, it was opined that in the present case, as the complainant and accused had willingly and amicably arrived at compromise; and complainant was not interested in further prosecution, therefore it would be futile to permit future trial inasmuch as it would not reach to its logical and correct conclusion as there is great possibility of witnesses turning hostile.

In view of the above, compromise arrived at between the parties was accepted and the compounding application was allowed. [Akil Ahmad v. State of Uttarakhand, 2019 SCC OnLine Utt 10, Order dated 16-01-2019]

Case BriefsHigh Courts

Himachal Pradesh High Court: A Single Judge Bench comprising of Tarlok Singh Chauhan, J., decided a criminal petition filed for quashing the judgment and order of conviction and sentence passed against the petitioner by the trial court for offence punishable under Section 138 of the Negotiable Instruments Act, wherein the said judgment and order was quashed in light of compromise between the parties.

The case of the petitioner was that subsequent to the passing of the above mentioned judgment, the petitioner had paid the entire amount in question to the complainant, and therefore he prayed that the impugned order should be quashed. The complainant was present before the Court and stated that he had received the entire amount in question and he had no objection if the said order passed against the petitioner is set aside.

The High Court held that it was not powerless in such situations and it had adequate powers not only under Section 397 read with 401 or Section 482 of CrPC, but also under Section 147 of the NI Act to accept the settlement entered into between the parties and quash the proceedings in the case against the accused. It was observed that such power have been conferred to subserve the ends of justice, however, it has to be exercised with circumspection. The Court further held that the present was not a case which could be stricto sensu said to be an offence against the State. Therefore, it was a case where the continuation of criminal case against the petitioner would put him to great oppression and prejudice and extreme injustice would be caused to him if the impugned judgment was not set aside. Accordingly, the Court ordered that the order of conviction and sentence passed against the petitioner by the trial court shall be quashed. [Inder Singh v. Sesu, 2018 SCC OnLine HP 272, decided on 23.3.2018]

Case BriefsHigh Courts

Punjab and Haryana High Court: FIR in cross cases filed between the contesting parties was quashed by a Single Judge Bench comprising of Mahabir Singh Sindhu, J., on the basis of compromise entered into between the parties.

The petitioner and the respondent, both, filed an FIR and cross cases against each other under Section 323 read with Section 34 of IPC in relation to an occurrence of a cross fight between them. In an earlier order passed by the High Court, the parties were directed to appear before the trial Court and get their statements recorded. After recording of such statements, learned Judicial Magistrate submitted his report, the perusal of which revealed that the parties had entered into a compromise in relation to the said incident.

The High Court found that the contents of the report submitted by the learned Judicial Magistrate showed that the said compromise was genuine, voluntary and without coercion or undue influence. The Court also gave due regard to the contention of the parties that since they have reached an amicable compromise between themselves, they should be given an opportunity to live peacefully. The Court observed that the injuries caused in the incident were not on vital parts of the body. None of the parties raised any objection regarding the quashing of FIR/cross-case in question. Hence, the High Court was of the view that it would be in the interest of justice that the parties were allowed to compromise the matter as the continuance of prosecution would be an exercise in futility.

In view of the above, the FIR, its cross version and all other consequential proceedings arising therefrom were quashed. [Dalvinder Singh alias Bindri v. State of Punjab, 2018 SCC OnLine P&H 140, order dated 30-1-2018]

Case BriefsHigh Courts

Karnataka High Court: While deciding a criminal petition filed under Section 482 of CrPC, a Single Judge Bench comprising of K.N. Phannendra, J. quashed a criminal case registered against the petitioner-accused, based on the compromise entered into between the parties.

The petitioner was accused in a criminal case registered under Sections 366A, 376, and 120B of IPC along with Section 4 of POCSO Act. The petitioner submitted that he has entered into a compromise with the prosecutrix-wife of the petitioner. He contended that based on the said compromise, the case registered against the petitioner should be quashed.

The High Court referred to a few Supreme Court decisions to understand as to under what circumstances the Court can record a compromise between the parties, even in the cases where offences alleged are serious in nature. The High Court, after perusal of such decisions, was of the opinion that cases involving heinous or serious offences of mental depravity and the like can not be quashed by the Court even if the victim and the offender have settled the dispute because such offences are not private in nature and have serious impact on the society at large. However, cases having overwhelmingly and predominantly civil flavor stand on a different footing; offences that are basically private in nature can be quashed by the Courts on the basis of settlement between the parties. In such circumstances, the Court should see whether the continuation of criminal proceedings would tantamount to abuse of process of law, and whether it is appropriate to end the proceedings to secure ends of justice.

In the instant case, the Court found that the prosecutrix was the wife of the petitioner. The alleged forceful sexual intercourse was committed after the marriage. The prosecutrix was almost seventeen years of age at the time of commission of alleged offence. Exception to Section 375 IPC, at the relevant time said that sexual intercourse with the wife if she is not less than 15 years of age, does not amount to rape. Also, at the relevant time, the provisions concerned of the POCSO Act were not in force. Further, a compromise was already entered into between the parties concerned.

On basis of the facts and circumstances of instant case, the Court thought it to be a fit case to exercise its discretion in favour of the petitioner. Accordingly, proceedings against him in the said criminal case were quashed. [Jameel Jabbar alias Mirza v. State of Karnatka, Crl. Petition No. 3269 of 2017, order dated 12.12.2017]

Case BriefsHigh Courts

Punjab and Haryana High Court: In a recent appeal before the High Court, it has held that a compromise between the parties is never a concrete ground to quash the criminal proceedings against the accused. The appellant in this case was sentenced to a RI of two years for offence under Sections 326, 323 and 324 IPC by the trial court.

The appellant prayed before the Court that it was a family dispute which had been resolved amicably. On hearing both the parties and also making sure from the opposite party that it was ready to give effect to compromise, the Bench of Jitendra Chauhan, J. brought attention to Narinder Singh v. State of Punjab, (2014) 6 SCC 466 in which the Apex Court had observed that the High Court may be somewhat liberal in accepting the settlement and quashing the proceedings/investigation keeping in mind the timing of the settlement.

The Court elucidated that it was not bound to quash the proceedings even if the compromise has been effected between the parties. However, it considered the fact that the appellant had already been suffering the agony of criminal trial and this very fact would act as the mitigating circumstance to reduce the sentence awarded to the appellant to the period already undergone further directing the parties to remain bound by the terms of the compromise. [Jagmohan Singh v. State of Punjab, 2017 SCC OnLine P&H 1798, decided on 03.07.2017]

Case BriefsHigh Courts

Punjab and Haryana High Court: In two subsequent cases decided by the Bench of  Inderjit, J., dealing with offences under Sections 420, 467, 468, 471  IPC (pertaining to cheating and forgery) and Sections 365, 343, 506 IPC (pertaining to wrongful confinement), the Court decided to quash the FIRs under Section 482 CrPC on the ground that compromise had been concluded between the parties.

The Court thoroughly enquired the factum of compromise between both the parties and held that in case the parties have indeed settled their dispute, the State would have no objection to the quashing of the FIR in view of the law laid down by the Hon’ble Supreme Court in Gian Singh v. State of Punjab, (2012) 10 SCC 303.

The Court worded its observations in both the cases as, “In a decision, based on compromise, none of the parties is a loser. Rather, compromise not only brings peace and harmony between the parties to a dispute, but also restores tranquility in the society. After considering the nature of offences allegedly committed and the fact that both the parties have amicably settled their dispute, continuance of criminal prosecution would be an exercise in futility, as the chances of ultimate conviction are bleak.” [Manjit Singh Saini v. State of Punjab, 2017 SCC OnLine P&H 1707, decided on 18.07. 2017]

Case BriefsHigh Courts

Kerala High Court:  Dismissing the criminal miscellaneous case where the petitioner having been  charged under Sections 304-A, 279 and 338 of the Penal Code, 1860 for causing death due to rash and negligent driving, sought quashing of the proceedings on the basis of a compromise entered into by the parties, the Court observed that such offences cannot be treated as a private dispute between the parties, so as to persuade the Court to accept a compromise and quash the proceedings.

The petitioner contended that a compromise had been entered into at the instance of mediators and the respondents had no objection to the proceedings being quashed. The Public Prosecutor however opposed the same, submitting that the Court was kept in the dark as to the terms of the settlement and the actual legal heirs of the deceased. Hence, if the offence under Section 304-A is quashed on the basis of a purported settlement with one of the legal heirs of the victim,  it would send a wrong signal.

The Bench of Raja Vijayraghavan, J. observed that an offence under Section 304-A IPC has the potentiality of making victims in many a layer thus creating a concavity in the social fabric. The impact on the society is felt all the more when accidents take place due to rash driving by drunken, negligent or adventurous drivers with no concern for others. The Court in exercise of powers under Section 482 CrPC cannot send a signal to the wrongdoer that payment of money can be a substitute for the crime committed against the society. The Court held that taking a lenient view of such an offence under Section 304-A will leave a wrong impression about the criminal justice system, encouraging further criminal acts, thus endangering the peaceful co-existence and welfare of the society at large. [Mohammed Ashraf v. State of Kerala, 2016 SCC OnLine Ker 4258, order dated May 18, 2016]

Case BriefsHigh Courts

Punjab and Haryana High Court: Deciding on the matter of whether the crime registered under Section 304-A of Penal Code, 1860 can be quashed on the basis of compromise arrived at by the legal heir/legal representative of the victim/deceased, with the offender, the two judge bench comprising of Mahesh Grover and Lisa Gill, JJ., observed that to quash the proceedings under Section 304-A solely on the basis of a settlement or compromise arrived at between the accused and the legal representatives is not permissible and militates against all canons of justice. It was further said that in the case under Section 304-A IPC the victim is obviously not present to settle the matter and hence, to permit a legal representative or legal heir to compromise or settle the matter is indeed an invitation to a dangerous trend and cannot be permitted.

Rejecting the contention that the offence under Section 304-A IPC is private in nature, the Court observed that, to consider that an offence under Section 304-A is private in nature is wholly incorrect and it is an offence which impacts society as a whole, permeating to the very core.

The Court further held that undoubtedly, there is a distinction between the power of the Court to compound an offence under Section 320 Cr. P.C. and quashing of criminal proceedings in exercise of power under Section 482 Cr. P.C. It is trite to mention that the power of the High Court under Section 482 Cr. P.C. can nevertheless be exercised in appropriate matters where it is felt that a prima facie case is not made out in consonance with the settled principles of law. (Baldev Singh v. State of Punjab, 2016 SCC OnLine P&H 4509, Decided on  02.06.2016).

Supreme Court

Supreme Court: In the present case, where the appellant was charged under Section 376 of IPC for committing rape upon a woman labourer working in his fields, a Bench of P.C. Ghose and M.Y Eqbal. JJ., while contemplating that whether the present case falls in the category of “adequate and special reason” under Section 376(2) (g), stated that the instant case which is 20 years old and the parties have married and entered into compromise, comes under “adequate and special reasons” and is a suitable case under the proviso in Section 376 (2) (g) for awarding a lesser sentence.

As per the case history, the appellant was convicted by the Trial Court under Section 376 and was sentenced to 10 years of rigorous imprisonment, which was further upheld by the Madhya Pradesh High Court on the ground that a victim of a sexual assault is not an accomplice to the crime and in prosecution of rape, the law does not require corroboration of the victim’s statement/evidence. Appearing for the appellant, Pratibha Jain cast doubts upon the evidences procured by the prosecution and contended that the evidences are not enough to link the offence to the accused as there is no corroboration and the prosecution contradicts itself on many important aspects. While C.D. Singh, appearing for the State of M.P. relied solely on the fact that a trace of semen was found on the victim’s petticoat, thereby clearly suggesting the commission of the offence by the appellant.

The Court upon perusing the contentions, relied upon the decision in Baldev Singh v. State of Punjab, (2011) 13 SCC 705, where the Supreme Court invoked the proviso under Section 376 (2) (g) of IPC as the case was very old and the parties had entered into compromise. Thus the Court while upholding the conviction of the appellant, reduced the sentence to the period already undergone by the appellant. Ravindra v. State of M.P., 2015 SCC OnLine SC 168, decided on 26.02.2015