• Chambers of Daksha Kumar

Criminal case quashed as the accused has repaid the amount due to the bank.

In the case of commercial cases, the court quashes the criminal proceeding if the dispute has been resolved between the parties outside of court. In this case, the court does not consider the proceeding necessary because the issue has already been settled.


The apex court dismissed the bank fraud case of Nikhil Merchant, in which the accused was also charged with fraudulently fabricating documents to obtain credit from the bank because the bank has withdrawn all charges against the accused and said that they have no further charges against him after the matter has been resolved between the parties.


The due payment was made, but the question before the Supreme Court was whether the court should terminate the proceedings even if the documents were falsified or not.


After evaluating all of the facts, the court decided to dismiss the charges against the accused because the court could infer a dominant civil case than a criminal case.


In another instance, the complaint had filed a Criminal Appeal 150/02 against the defendants who borrowed money on the cheque. The complainant requests reimbursement after a period of time, but when the accused fails to do so, the complainant files a complaint.

The case was filed with the court under section 138 of the N.I. Act. However, the accused then claimed that a part of the money had been reimbursed, but the petitioner is seeking payment for the amount of the cheque, which is more than the initial amount. As a result, no offence has been committed under section 138 of the N.I. Act.


The court later stated that the cheque could be withdrawn against all or part of the amount under section 138 of the N.I. Act. However, if the amount of the cheque exceeds the obligation, section 138 will overrule.


As a result of the foregoing, we can see that in circumstances where the appropriate payment has been made and a compromise has been reached between the parties, the need to continue the proceedings is almost non-existent.

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