Prosecutor Philip Sewell told the court that Knowles was stopped by police when he left a pub on February 24.
He was arrested for suspected drink-driving but a breath test showed he was under the legal limit, the court was told.
But Knowles was charged with possession of the knife, which was found in its pouch in the car glove compartment.
Mr Sewell told the court: 'He told officers that he had the knife for caravanning. He is not working and had no malicious reason for carrying the blade'
Defence solicitor Jolyon Tuck said Knowles, who is a carer for his wife, had used the knife to cut up fruit on picnics with his wife.
'He accepts it was in his car and the law is very clear,' he said. He admits possession of it and he had no good reason for having it.'
Chairman of the bench Robert Horne ordered forfeiture of the knife and £40 costs to be paid.
He said: 'There is no previous conviction history whatsoever and it was not in his possession and was in the car glove compartment in a pouch.'
The retired maintenance engineer, from Buckland, Devon, had no criminal record before the case.
He said: 'The tool was in my glove box in a pouch, along with a torch, first aid kit and waterproofs.
'It is everything I need for the maintenance of my car or if I break down.
'Now I have a criminal record for the first time in my life. I am upset by that.'
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