Authority: High Court of Gujarat, Ahmedabad

Order Date: 05/11/2026

Case Overview

  • Parties: Hemantbhai Chandulal Vyas, Proprietor of Donna Chem (Applicant) vs. State of Gujarat & Anr (Respondents) and original complainant (Respondent No.2).
  • Nature: Criminal Revision Application (No.3173/2026) and Criminal Miscellaneous Application (Stay) No.1 of 2026 against conviction under Section 138 of the Negotiable Instruments Act (cheque bounce).
  • Background: The matter was settled between the parties; the applicant deposited 10% of the cheque amount as compounding charges, receipt placed on record.
  • Legal Basis: Compounding permissible under Section 147 of the NI Act; voluntary compromise verified by the Court.
  • Reference: Supreme Court decision in Damodar S. Prabhu v. Sayed Babalal H., AIR 2010 SC 1907, which allows the Court to reduce costs based on facts; the applicant, aged about 69 and having suffered imprisonment, was directed to pay 10% (instead of 15%) of the cheque amount to the Gujarat State Legal Services Authority.

Final Outcome

  • The conviction and sentence passed by the Trial Court and confirmed by the First Appellate Court are quashed and set aside.
  • The applicant is treated as acquitted and is not required to serve any remaining sentence.
  • The revision application is allowed; the rule is made absolute, and CR.MA No.1 of 20226 is disposed.

Topics: Legal Settlement, Cheque Bounce, Court Revision