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High Court of Gujarat

HARESHKUMAR RAMESHBHAI DARJIversusSTATE OF GUJARAT

Disposal
38-RULE ABSOLUTE/ALLOWED @ FH

Holding

The conviction under Section 138 of the Negotiable Instruments Act is quashed and the applicant acquitted because the offence was compounded with the complainant’s consent under Section 147.

Summary

The applicant sought revision of a conviction under Section 138 of the Negotiable Instruments Act, which had been affirmed by the appellate court. During the pendency of the proceedings the parties settled the dispute amicably, and the complainant executed an affidavit confirming receipt of the agreed amount and gave consent to compound the offence. The court examined the object of Section 147 of the NI Act, noting its overriding effect over Section 320(1) of the Code of Criminal Procedure as held in Damodar S. Prabhu v. Sayed Baba Lal. On the basis of the settlement and the complainant’s consent, the court held that the offence was compounded and therefore the conviction could not stand. Consequently, the conviction and sentence were quashed, the applicant was acquitted and ordered to be released, and the complainant was directed to be paid the settled amount. The revision application was allowed.

Issues considered

  • Whether a conviction under Section 138 of the Negotiable Instruments Act can be set aside on the ground of settlement and the complainant’s consent to compound the offence under Section 147.
  • Whether Section 147 of the NI Act overrides the requirement of Section 320(1) of the CrPC in cases of compounding.

Legislation cited

Subjects

Negotiable Instruments ActSection 138Section 147Compounding of offenceCriminal revisionSettlementAcquittalCrPC Section 320

Judgment

     R/CR.RA/1175/2025                              ORDER DATED: 29/04/2026




            IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

     R/CRIMINAL REVISION APPLICATION (AGAINST CONVICTION -
          NEGOTIABLE INSTRUMENT ACT) NO. 1175 of 2025

==========================================================
                         HARESHKUMAR RAMESHBHAI DARJI
                                     Versus
                            STATE OF GUJARAT & ANR.
==========================================================
Appearance:
MR YASH K DAVE(10269) for the Applicant(s) No. 1
MR YASHKUMAR J TRIVEDI(9624) for the Applicant(s) No. 1
MR PRANAV DHAGAT, APP for the Respondent(s) No. 1
MR HS PATEL for MR. RONAK N. SHEKHALIYA(17923) for the
Respondent(s) No. 2
MR SANKET K PANDYA(9451) for the Respondent(s) No. 2
==========================================================

 CORAM:HONOURABLE MS. JUSTICE GITA GOPI

                                Date : 29/04/2026

                                    ORDER


1.     RULE. Learned advocates waive service of Rule on behalf of
       the respective respondents.


2.     Challenge in this Revision Application is given to the judgment
       and order of conviction and sentence dated 27.7.2023 passed
       by the learned 2nd Additional Chief Judicial Magistrate, Deesa
       in Criminal Case no. 4541/21, which was confirmed by the
       judgment and order dated 2.7.2025 passed by the learned 8 th
       Additional Sessions Judge, Banaskantha at Deesa in Criminal
       Appeal no. 62/23.


3.     Learned advocate for the applicant submitted that during the
       pendency of the proceedings, parties have settled the


                                    Page 1 of 3
     R/CR.RA/1175/2025                          ORDER DATED: 29/04/2026




       disputes amicably outside the Court and that there remains
       no grievance between them.


4.     Learned advocate for respondent no.2 – original complainant
       has placed on record the affidavit of settlement filed by the
       respondent no.2–original complainant and stated that the
       complainant has received the amount as agreed between the
       parties and the complainant does not want to pursue the
       matter now in view of amicable settlement and has given
       consent for compounding the offence. The same is taken on
       record. Today, respondent no.2 is present before this Court
       and the respondent no.2 has affirmed the contents of the
       affidavit and is identified by learned advocate for respondent
       no.2.


5.     Since the complainant has given consent for compounding the
       offence, keeping in mind the object of Section 147 of the NI
       Act, which is an enabling provision which provides for
       compounding the offence and may require the consent of the
       aggrieved for compounding the offence, however, the specific
       provision under Section 147, inserted by way of amendment
       towards special law, would give overriding effect to sub-
       section (1) of Section 320 of the Code of Criminal Procedure,
       1973 as has been observed in the case of Damodar S. Prabhu
       v. Sayed Baba Lal, AIR 2010 SC 1907. Accordingly, as the
       dispute has been resolved and the entire amount has been
       paid to the complainant, in consonance with the object of the
       N.I. Act and the provisions under Section 147 thereof, the
       matter is considered as compounded.




                               Page 2 of 3
     R/CR.RA/1175/2025                                                           ORDER DATED: 29/04/2026




6.      In aforesaid view of the matter, the judgment and order
        passed by the learned Trial Court of conviction and sentence
        for the offence punishable under Section 138 of the NI Act, as
        affirmed by the learned Appellate Court, are quashed and set
        aside. The applicant stands acquitted and release from the jail
        forthwith.


7.      In view of the above, the concerned Court is directed to
        disburse an amount of Rs.96,750/- to the complainant on
        proper verification of the identity.


8.      Accordingly, the present application is allowed in the above
        terms. Rule is made absolute to the aforesaid extent. Direct
        service is permitted.


                                                                                               (GITA GOPI,J)
        Maulik


Original copy of this order has been signed by the Hon'ble Judge.
Digitally signed by: MAULIK RAJESH PANDYA(HC00205), PRINCIPAL PRIVATE SECRETARY, at High Court of Gujarat on 29/04/2026 17:11:11




                                                   Page 3 of 3


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