Chapter VIII - Miscellaneous
Section 96
Section 96: Compounding of offences
Eligible section 88 or 89 offences may be compounded before or after prosecution on a prescribed payment, subject to the section’s court-leave and repeat-offence limits.
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Need advice on Section 96?
This article is for general information. Refer to the Consumer Protection Act, 2019 official text for the official provisions. If you need professional advice for your situation, contact Bizeneed.
Statutory text
Bare law
(1) Any offence punishable under sections 88 and 89, may, either before or after the institution of the prosecution, be compounded, on payment of such amount as may be prescribed: Provided that no compounding of such offence shall be made without the leave of the court before which a complaint has been filed under section 92: Provided further that such sum shall not, in any case, exceed the maximum amount of the fine, which may be imposed under this Act for the offence so compounded. (2) The Central Authority or any officer as may be specially authorised by him in this behalf, may compound offences under sub-section (1). (3) Nothing in sub-section (1) shall apply to person who commits the same or similar offence, within a period of three years from the date on which the first offence, committed by him, was compounded. Explanation.—For the purposes of this sub-section, any second or subsequent offence committed after the expiry of a period of three years from the date on which the offence was previously compounded, shall be deemed to be a first offence. (4) Where an offence has been compounded under sub-section (1), no proceeding or further proceeding, as the case may be, shall be taken against the offender in respect of the offence so compounded. (5) The acceptance of the sum of money for compounding an offence in accordance with sub-section (1) by the Central Authority or an officer of the Central Authority empowered in this behalf shall be deemed to amount to an acquittal within the meaning of the Code of Criminal Procedure, 1973 (2 of 1974).
Key takeaways
Statutory scope
Eligible section 88 or 89 offences may be compounded before or after prosecution on a prescribed payment, subject to the section’s court-leave and repeat-offence limits.
Key limit
Court leave is required once a section 92 complaint is filed; a repeat similar offence within three years cannot use this route.
Practical response
Check offence history, prescribed amount and court stage before offering payment; secure the formal compounding order and receipt.
Apply the statutory test
Check eligibility, previous compounding date, amount ceiling and the stage of prosecution in that order.
Prepare the response
Check offence history, prescribed amount and court stage before offering payment; secure the formal compounding order and receipt.
Payment cannot exceed the maximum fine for that offence and does not cover sections 90 or 91.
Illustrative example
A service provider facing its first section 89 complaint explores compounding and seeks court leave because prosecution is already pending.
Official sources
Practical checklist
Do
- Check offence history, prescribed amount and court stage before offering payment; secure the formal compounding order and receipt.
- Keep dated records of the relevant goods, notices, decisions and official communications.
Avoid
- Payment cannot exceed the maximum fine for that offence and does not cover sections 90 or 91.
Glossary
- Compounding
- Statutory settlement of an eligible offence on the prescribed payment with the legal effect set out here.
Frequently asked questions
Can a second similar offence be compounded soon after the first?
Not if the same or similar offence occurs within three years after the first was compounded.
What changes after a court complaint is filed?
Compounding then requires leave of the court before which the section 92 complaint was filed.
Need help applying this provision to your situation?
Contact BizeneedLast updated 10 October 2026