Vinay Devanna Nayak vs Ryot Seva Sahakari Bank Ltd

Vinay Devanna Nayak vs Ryot Seva Sahakari Bank Ltd.  - Important Supreme Court Case 2007


On 7th December, 2007, a two Judges Bench in Vinay Devanna Nayak vs Ryot Seva Sahakari Bank Ltd. [Criminal Appeal No.1679 of 2007] while examining the issue as to whether an offence punishable under Section 138 of the Negotiable Instruments Act, 1881 can be compounded, held that the provision "is intended to prevent dishonesty on the part of the drawer of negotiable instruments in issuing cheques without sufficient funds or with a view to inducing the payee or holder in due course to act upon it. It thus seeks to promote the efficacy of bank operations and ensures credibility in transacting business through cheques. In such matters, therefore, normally compounding of offences should not be denied."


Taking into consideration Section 147 inserted by the Negotiable Instruments (Amendment and Miscellaneous Provisions Act, 2002) and the primary object underlying Section 138, the Bench held that "there is no reason to refuse compromise between the parties."

    Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले

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