Whether the time for depositing the Compounding Fee as allowed under Section 147 of the Negotiable Instruments Act, 1881 can be extended especially in view of the bar as created by Section 362 CrPC? – Krishan Chand Vs. Mahindra and Mahindra Financial Services Ltd. – Himachal Pradesh High Court
Hon’ble Himachal Pradesh High Court held that:
(i) The ‘compounding fee’ strictu sensu does not fall within the definition of ‘fine’.
(ii) The compounding fee is nothing, but, an additional burden on the accused, who has not compounded the offence, at the initial stage, i.e. before the learned trial Court, where the compounding can be done, without imposition of any compounding fee, on the accused.
(iii) The compounding fee has no relevance in the adjudication of the controversy involved, in such type of cases.
(iv) The requirement of Section 147 of NI Act is compounding between the parties and the imposition, as well as, the depositing of the compounding fee, is a sort of message to the similarly situated litigants, to compound the offences, at the initial stage of the litigation, in order to avoid payment of the compounding fee.
(v) The payment of compounding fee is a sort of atonement in those cases, where, the compounding has been done at a later stage, i.e., when the lis is pending before the higher Court, as, the Hon’ble Supreme Court has exempted the person, who compounds the offence, at the initial stage.
