In Brief
P. Chandrakala was convicted under Section 138 of the Negotiable Instruments Act (cheque dishonour) and sentenced to six months imprisonment with fine and compensation. She appealed through multiple courts. During the High Court revision, the parties settled the dispute and the complainant confirmed receipt of the full amount owed. The Supreme Court allowed the appeal and set aside the conviction based on the compromise. However, to deter wastage of judicial time, the Court imposed exemplary costs of Rs. 1 lakh, directing payment to a child welfare orphanage with automatic revival of conviction if payment was not made within the specified timeframe.
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