RAJENDRA ANANT VARIKversusGOVIND B. PRABHUGAONKAR

                  [2025] 6 S.C.R. 303 : 2025 INSC 633

                          Rajendra Anant Varik
                                   v.
                        Govind B. Prabhugaonkar
                     (Criminal Appeal No. 2476 of 2025)
                                  06 May 2025
               [Vikram Nath and Sandeep Mehta,* JJ.]


                            Issue for Consideration
       Whether the High Court was justified in reversing the judgment
       of the First Appellate Court acquitting the appellant-accused and
       setting aside his conviction u/s.138, Negotiable Instruments Act,
       1881 as recorded by the trial Court.

                                   Headnotes†
       Negotiable Instruments Act, 1881 – s.138 – Goa Money-Lenders
       Act, 2001 – Applicability of – First Appellate Court allowed
       the appellant’s appeal against conviction – It was held that
       as the respondent-complainant was indulged in money
       lending activities without acquiring a license, thus, he was
       acting in breach of the provisions of the Goa Act and hence,
       he was precluded from prosecuting the appellant under
       NI Act – Acquittal reversed by High Court – Interference
       with:
       Held: High Court while reversing the acquittal of the appellant did
       not advert to the important issue regarding applicability of the Goa
       Act which provided a valid defense available to the appellant –
       Further, the appellant has already paid the cheque amount and the
       fine imposed by the trial Court – Offence compounded in exercise
       of powers u/Art.142 of the Constitution of India – Appellant acquitted
       subject to the condition stated – Constitution of India – Art.142.
       [Paras 8, 10]

                                   List of Acts
       Negotiable Instruments Act, 1881; Goa Money-Lenders Act, 2001;
       Code of Criminal Procedure, 1973; Constitution of India.



* Author
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                                          List of Keywords
       Valid defense; Money lending activities; Without acquiring license;
       Precluded from prosecuting; Appeal against conviction; Acquittal
       reversed; Offence compounded; Compensation paid; Cheque
       amount paid; Powers under Article 142 of the Constitution of India
       exercised.

                                         Case Arising From
       CRIMINAL APPELLATE JURISDICTION: Criminal Appeal No.
       2476 of 2025
       From the Judgment and Order dated 07.01.2023 of the High Court
       of Judicature at Bombay at Goa in CRLA No. 53 of 2017

                                    Appearances for Parties
       Advs. for the Appellant:
       Ivo Dcosta, Guruprasad Naik, Sahil Tagotra.

                       Judgment / Order of the Supreme Court

                                                Judgment

       Mehta, J.

1.     Heard.
2.     Leave granted.
3.     The accused-appellant has approached this Court, through this
       appeal by special leave, assailing the judgment dated 7th January,
       2023, passed by the High Court of Judicature at Bombay at Goa1
       in Criminal Appeal No. 53 of 2017 whereby the High Court quashed
       and set aside the judgment dated 6th February 2017, passed by the
       First Appellate Court being the Court of Sessions Judge, South Goa
       at Margao2 in Criminal Case No. 29/NI/2014. The First Appellate
       Court had allowed the Criminal Appeal No. 72 of 2016 filed by the
       accused-appellant against the conviction order dated 5th August, 2016



1    Hereinafter, being referred to as the ‘High Court’.
2    Hereinafter, being referred to as the ‘First Appellate Court’.
[2025] 6 S.C.R.                                                       305

                Rajendra Anant Varik v. Govind B. Prabhugaonkar


       passed by the learned Judicial Magistrate First Class, Canacona3,
       and acquitted him while setting aside his conviction for the offence
       punishable under Section 138 of the Negotiable Instruments Act,
       18824 as recorded by the trial Court.
4.     While reversing the acquittal of the accused-appellant, the High
       Court restored the judgment dated 5th August, 2016, passed by the
       trial Court in Criminal Case No. 29/NI/2014, convicting the accused-
       appellant for the offence punishable under Section 138 of the
       NI Act and directing that he shall pay compensation to the tune of
       Rs. 2,00,000/- to the complainant-respondent under Section 357 of
       Code of Criminal Procedure, 19735 towards the cheque amount and
       further compensation to the tune of Rs. 30,000/- in the form of cost
       and, in default, shall undergo sentence of simple imprisonment for
       a period of three months. In addition, the accused-appellant was
       directed to undergo sentence till the rising of the Court.
5.     The First Appellate Court had allowed the appeal, preferred by the
       accused-appellant, holding that the complainant-respondent was
       indulging in money lending activities, without acquiring a license
       and was thereby acting in breach of the provisions of the Goa
       Money-Lenders Act, 20016 and hence, he was precluded from
       prosecuting the accused-appellant under NI Act.
6.     No one has put in appearance on behalf of the respondent-
       complainant despite service of notice.
7.     Learned counsel appearing for the accused-appellant, urged that the
       accused-appellant had returned the entire amount of loan taken from
       the complainant-respondent between January 2012 to July 2013. He
       further submitted that since the accused-appellant has returned the
       amount of the cheque to the complainant-respondent with interest
       payable thereupon, he is entitled to be acquitted by compounding
       the offence.
8.     Upon having considered the entirety of the facts and circumstances
       as emerging from the record, we find that the High Court, while


3    Hereinafter, being referred to as the ‘trial Court.’
4    Hereinafter, being referred to as ‘NI Act’.
5    Hereinafter, being referred to as ‘CrPC’.
6    Hereinafter, being referred to as the ‘Goa Act’.
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       reversing the acquittal of the accused-appellant, as recorded by the
       First Appellate Court, did not advert to the important issue regarding
       applicability of the Goa Act which provided a valid defense available
       to the accused-appellant. Thus, apparently, the judgment rendered
       by the High Court does not stand to scrutiny.
9.     Furthermore, it is an admitted position that the cheque amount to the
       tune of Rs. 2,00,000/- and the compensation amount to the tune of
       Rs. 30,000/-, as imposed by the trial Court, has already been paid
       by the accused-appellant.
10. In view of the facts noted above and considering the aspect that the
    accused-appellant has already paid the cheque amount and the fine
    of Rs. 30,000/- imposed by the trial Court, we hereby, exercise our
    powers under Article 142 of the Constitution of India, to compound
    the offence and acquit the accused-appellant of the accusation
    under Section 138 of the NI Act subject to the condition that the
    entire amount of Rs.2,30,000/- deposited by the accused-appellant
    shall be paid to the complainant-respondent, if the same has not
    been paid till date.
11. Consequently, the present appeal is allowed in these terms.
12. Pending application(s), if any, shall stand disposed of.

       Result of the case: Appeal allowed.



       †
           Headnotes prepared by: Divya Pandey