BENGALURU: The Karnataka High Court has ruled that trial courts cannot impose fines exceeding twice the amount of a dishonoured cheque in cheque bounce cases.
Justice V Srishananda made the observation while partly allowing an appeal filed by Mahadevi, an agriculturist from Banahatti in Bagalkot district.
The case dates back to November 2007, when Mahadevi purchased two trailers for Rs 3.8 lakh after receiving a discount of Rs 5,000. She issued a cheque towards payment, which was later dishonoured, prompting the seller to initiate proceedings under the Negotiable Instruments Act.
On May 8, 2017, the Banahatti magistrate’s court convicted Mahadevi and directed her to pay Rs 7.6 lakh as compensation to the seller, along with Rs 5,000 towards defraying expenses payable to the state government.
Her appeal was dismissed by the district court, following which she approached the High Court. Mahadevi contended that the trailers were never delivered to her. However, Justice Srishananda noted that she had failed to substantiate this claim.
While upholding the compensation of Rs 7.6 lakh—twice the cheque amount—the High Court set aside the direction to pay Rs 5,000 towards defraying expenses, observing that no state machinery had been involved in the transaction.
