RAHUL BABULAL SHAH PROPRIETOR OF JAY TRAVELSversusSTATE OF GUJARAT
- Disposal
- 38-RULE ABSOLUTE/ALLOWED @ FH
- Bench
- GITA GOPI
Holding
The conviction under Section 138 NI Act is quashed and the applicant acquitted because the offence was compounded with the complainant's consent under Section 147, which prevails over Section 320 CrPC.
Summary
Rahul Babulal Shah, proprietor of Jay Travels, was convicted under Section 138 of the Negotiable Instruments Act and sentenced to one year simple imprisonment, a conviction later upheld by the Additional Sessions Judge. He filed a criminal revision application alleging that the dispute with the complainant had been amicably settled, with the complainant receiving Rs.3,50,000 and giving consent to compound the offence. The court examined the provisions of Section 147 of the NI Act, which allows compounding with the aggrieved's consent, and held that it overrides the earlier conviction under Section 320 of the CrPC as per precedent. Accepting the complainant's affidavit confirming full payment, the court quashed the conviction and acquitted the applicant. Consequently, the revision application was allowed and the judgment of conviction set aside.
Issues considered
- Whether a conviction under Section 138 of the Negotiable Instruments Act can be set aside when the offence is compounded with the complainant's consent under Section 147.
- Whether Section 147 of the NI Act overrides the provisions of Section 320(1) of the Code of Criminal Procedure in the context of compounding offences.
Legislation cited
- Code of Criminal Procedure, 1973s. 320(1)
- Negotiable Instruments Acts. 138, s. 147
Subjects
Judgment
R/CR.RA/426/2026 ORDER DATED: 10/03/2026
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/CRIMINAL REVISION APPLICATION (AGAINST CONVICTION -
NEGOTIABLE INSTRUMENT ACT) NO. 426 of 2026
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RAHUL BABULAL SHAH PROPRIETOR OF JAY TRAVELS
Versus
STATE OF GUJARAT & ANR.
==========================================================
Appearance:
MS JAHNAVI D PANCHAL(11344) for the Applicant(s) No. 1
MR BHARGAV PANDYA APP for the Respondent(s) No. 1
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CORAM:HONOURABLE MS. JUSTICE GITA GOPI
Date : 10/03/2026
ORAL ORDER
1. Learned advocate Mr. D.J. Mehta seeks permission to
le vakalatnma on behalf of respondent no.2 - original
complainant. Permission is granted. O ice to accept
vakalatnama of Mr. Mehta.
2. RULE. Learned advocates waive service of Rule on
behalf of the respective respondents.
3. The applicant-accused had been convicted by the
Additional Chief Judicial Magistrate, Ahmedabad on
30.01.2025 in Criminal Case No.48533 of 2023 for the o ence
under Section 138 of the N.I. Act and sentenced him to
undergo one year simple imprisonment, which was upheld and
con rmed on 05.01.2026 by the learned Additional Sessions
Judge, Ahmedabad in Criminal Appeal No.194 of 2025.
Page 1 of 3
R/CR.RA/426/2026 ORDER DATED: 10/03/2026
4. Learned advocate for the applicant submitted that the
parties have settled the disputes amicably outside the Court
and that there remains no grievance between them.
5. Original complainant is present before this Court along
with learned advocate Mr. D.J. Mehta, who has placed on
record the a idavit led by the respondent no.2–original
complainant and stated that the amount, as agreed between
the parties has already been paid. The same is taken on
record. Respondent No.2 - original complainant has a irmed
the contents of the a idavit and stated that total amount of
Rs.3,50,000/- had been received.
6. Since the complainant has given consent for
compounding the o ence, keeping in mind the object of
Section 147 of the NI Act, which is an enabling provision
which provides for compounding the o ence and may require
the consent of the aggrieved for compounding the o ence,
however, the speci c provision under Section 147, inserted by
way of amendment towards special law, would give overriding
e ect 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.
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R/CR.RA/426/2026 ORDER DATED: 10/03/2026
7. In aforesaid view of the matter, the judgment and order
of conviction and sentence dated 30.01.2025 passed by the
learned Additional Chief Judicial Magistrate, Ahmedabad in
Criminal Case No.48533 of 2023 for the o ence punishable
under Section 138 of the NI Act, as a irmed by the learned
Additional Sessions Judge, Ahmedabad in Criminal Appeal
No.194 of 2025 dated 05.01.2026, are quashed and set aside.
The applicant stands acquitted.
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)
Pankaj/45
Original copy of this order has been signed by the Hon'ble Judge.
Digitally signed by: PANKAJ KUMAR PRASAD(HC00967), PRINCIPAL PRIVATE SECRETARY, at High Court of Gujarat on 11/03/2026 13:46:20
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