Complainant Cannot Be Permitted To Back Out Of Mutual Compromise, Would Act As “Premium” For Dishonest Litigation: Punjab & Haryana HC

The Punjab & Haryana High Court has made it clear that once parties have entered into mutual settlement, backing out from the same cannot be allowed under the law.

In a cheque bounce case the complainant backed out from the compromise, however the court rejected the claim and quashed the complaint in view of earlier stand that compromise had taken place.

Justice N.S. Shekhawat said, "it is unhesitatingly held that the respondent No. 1/complainant cannot be permitted to back out from the mutual settlement arrived at between him and the petitioner. If any of the parties are allowed to back out from their mutual settlement, it would amount to granting premium to a dishonest litigation and shall also render the Court proceedings to a mockery, which cannot be permitted in law."

These observations were made while hearing the plea to quash the complaint, filed in cheque bounce case under Sections 138, 142 of the Negotiable Instruments Act 1881 and all subsequent proceedings arising therefrom.

Counsel for the submitted had submitted that the complainant as compromised the matter and taken back the amount involved in the complaint under Section 138 of the Negotiable Instruments Act.

He also recorded a statement to the effect that he has compromised the present complaint and wants to withdraw the same.

While issuing notice in the case, the Court noted that the Trial Court had passed an order stating that complainant has appeared and suffered a statement to compromise with the accused, hence he wants to withdraw the present complaint. 

However, during the hearing counsel for the respondents submitted that there was no compromise between the petitioner and the complainant and the petitioner is yet to make the payments.

After examining the submissions, the Court referred to catena of judgements of the Apex Court and High Court, to underscore that when the parties have entered into a compromise, and the complainant has backed out from the same, the FIR is liable to be quashed in such like situation.

Reliance was also placed on Ruchi Aggarwal Vs. Amit Kumar Agrawal [ SLP (Crl.) No. 3769 of 2003], wherein the Court said that, "appellant having received the relief she wanted without contest on the basis of the terms of the compromise, we cannot now accept the argument of the learned counsel for the appellant. In our opinion, the conduct of the appellant indicates that the criminal complaint from which this appeal arises was filed by the wife only to harass the respondents”.

In light of the above, the Court considered the compromise and quashed the complaint.

Mr. Lalit Singla, Advocate with Ms. Varsh Sharma, Advocate for the petitioner.

Mr. Rahul Jaswal, Advocate, for respondent No. 1. Ms. Sheenu Sura, DAG, Haryana.

Title: Babli v. Khillar Singh and another

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