What is basic concept of S 141 of Negotiable instruments Act?

 Section 141 of the Negotiable Instruments Act deals with vicarious liability when the drawer of the dishonoured cheque is a company or firm, not a natural person. It says that along with the company, every person who at the time of the offence was in charge of and responsible for the conduct of its business can also be prosecuted, subject to the statutory defence that the offence occurred without his knowledge or despite due diligence.

Interview answer

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Supreme Court: Appellate court may not order deposit of 20% of compensation in appeal against conviction in checque dishonour case

We may take the discussion a little forward to emphasize

our point of view. There could arise a case before the Appellate

Court where such court is capable of forming an opinion, even in

course of considering as to what would be the appropriate

quantum of fine or compensation to be kept in deposit, that the

impugned conviction and the consequent sentence

recorded/imposed by the trial court is so wholly incorrect and

erroneous that it is only a matter of time for the same to be set

aside and that ordering a deposit would be unnecessarily

burdensome for the appellant. Such firm opinion could be formed

on a plain reading of the order, such as, the conviction might have

been recorded and sentence imposed without adherence to the

mandatory procedural requirements of the N.I. Act prior to/at the

time lodging of the complaint by the complainant rendering the

proceedings vitiated, or the trial court might have rejected

admissible evidence from being led and/or relied on inadmissible

evidence which was permitted to be led, or the trial court might

have recorded an order of conviction which is its ipse dixit, without

any assessment/analysis of the evidence and/or totally

misappreciating the evidence on record, or the trial court might

have passed an order failing to disclose application of mind and/or

sufficient reasons thereby establishing the link between the

appellant and the offence, alleged and found to be proved, or that

the compensation awarded is so excessive and outrageous that it

fails to meet the proportionality test : all that, which would evince

an order to be in defiance of the applicable law and, thus, liable to

be labelled as perverse. These instances, which are merely

illustrative and not exhaustive, may not arise too frequently but its

possibility cannot be completely ruled out. It would amount to a

travesty of justice if exercise of discretion, which is permitted by

the legislature and could indeed be called for in situations such as

these pointed out above, or in any other appropriate situation, is

not permitted to be exercised by the Appellate Court by a judicial interpretation of ‘may’ being read as ‘shall’ in sub-section (1) of Section 148 and the aggrieved appellant is compelled to make a deposit of minimum 20% of the fine or compensation awarded by the trial court, notwithstanding any opinion that the Appellate Court might have formed at the stage of ordering deposit as regards invalidity of the conviction and sentence under challenge on any valid ground. Reading ‘may’ as ‘may’ leads to the text matching the context and, therefore, it seems to be just and proper not to denude the Appellate Court of a limited discretion conferred by the legislature and that is, exercise of the power of not ordering deposit altogether albeit in a rare, fit and appropriate case which commends to the Appellate Court as exceptional. While there can be no gainsaying that normally the discretion of the Appellate Court should lean towards requiring a deposit to be made with the quantum of such deposit depending upon the factual situation in every individual case, more so because an

order under challenge does not bear the mark of invalidity on its

forehead, retention of the power of such court not to order any

deposit in a given case (which in its view and for the recorded

reasons is exceptional) and calling for exercise of the discretion to

not order deposit, has to be conceded. If indeed the legislative

intent were not to leave any discretion to the Appellate Court,

there is little reason as to why the legislature did not also use

‘shall’ instead of ‘may’ in sub-section (1). Since the self-same

section, read as a whole, reveals that ‘may’ has been used twice

and ‘shall’ thrice, it must be presumed that the legislature was

well and truly aware of the words used which form the skin of the

language. Reading and understanding the words used by the

legislature in the literal sense does not also result in manifest

absurdity and hence tinkering with the same ought to be avoided

at all costs. We would, therefore, read ‘may’ as ‘may’ and ‘shall’ as ‘shall’, wherever they are used in Section 148. This is because, the words mean what they say. {Para 27}

REPORTABLE

IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL No. 5491/2024

MUSKAN ENTERPRISES & ANR. Vs THE STATE OF PUNJAB & ANR. 

DIPANKAR DATTA, J.

Citation: 2024 INSC 1046.

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Supreme Court: 20% deposit of compensation amount in appeal against conviction for offence U/S 138 of NI Act is not an absolute rule and can be relaxed in exceptional cases

What is held by this Court is that a purposive interpretation should be made of Section 148 of the N.I. Act. Hence, normally, Appellate Court will be justified in imposing the condition of deposit as provided in Section 148. However, in a case where the Appellate Court is satisfied that the condition of deposit of 20% will be unjust or imposing such a condition will amount to deprivation of the right of appeal of the Appellant, exception can be made for the reasons specifically recorded. {Para 6}

7. Therefore, when Appellate Court considers the prayer Under Section 389 of the Code of Criminal Procedure of an Accused who has been convicted for offence Under Section 138 of the N.I. Act, it is always open for the Appellate Court to consider whether it is an exceptional case which warrants grant of suspension of sentence without imposing the condition of deposit of 20% of the fine/compensation amount. As stated earlier, if the Appellate Court comes to the conclusion that it is an exceptional case, the reasons for coming to the said conclusion must be recorded.

 IN THE SUPREME COURT OF INDIA

Criminal Appeal No. 2741 of 2023 

Decided On: 04.09.2023

Jamboo Bhandari Vs. M.P. State Industrial Development Corporation Ltd. and Ors

Hon'ble Judges/Coram:

Abhay Shreeniwas Oka and Pankaj Mithal, JJ.

Author: Abhay Shreeniwas Oka, J.

Citation: 2023 INSC 822, MANU/SC/1005/2023.

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Important articles and Judgments on S 223 of BNSS

 

1) To what extent the Session Judge or Magistrate can permit accused to put his defence at pre-cognizance stage as per S 223 of BNSS?

https://www.lawweb.in/2025/07/to-what-extent-session-judge-or.html

2) No Need For Pre-Cognizance Summons To Accused In S.138 NI Act Case : Supreme Court Issues Directions For Speedy Trial Of Cheque Bounce Cases

E. Recently, the High Court of Karnataka in Ashok v. Fayaz Aahmad   MANU/KA/1743/2025 has taken the view that since NI Act is a special enactment, there is no need for the Magistrate to issue summons to the Accused before taking cognizance (Under Section 223 of BNSS) of complaints filed Under Section 138 of NI Act. This Court is in agreement with the view taken by the High Court of Karnataka. Consequently, this Court directs that there shall be no requirement to issue summons to the Accused in terms of Section 223 of BNSS i.e., at the pre-cognizance stage.

IN THE SUPREME COURT OF INDIA

Criminal Appeal No. 1755 of 2010

Decided On: 25.09.2025

 Sanjabij Tari Vs. Kishore S. Borcar and Ors.

Hon'ble Judges/Coram:

Manmohan and N.V. Anjaria, JJ.

Author: Manmohan, J.

Citation: 2025 INSC 1158, MANU/SC/1336/2025.

https://www.lawweb.in/2025/09/no-need-for-pre-cognizance-summons-to.html

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Supreme Court: Asking Accused To Appear In Every Criminal Appeal Hearing Unwarranted When Sentence Has Been Suspended

 It is appalling and shocking to note that appellate court having insisted for appearance of the appellant on every date of hearing particularly in the backdrop of the suspension of sentence already passed. Prima facie the course open for the appellate court was to either appoint an amicus curiae and hear the appeal on merits and pass appropriate orders thereon or grant an opportunity to the concerned appellant-accused to make alternate arrangement if counsel was not assisting the Court. {Para 8}

 IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL NO. OF 2026

ARISING OUT OF SLP (CRIMINAL) NO. 19050 OF 2025

MEENAKSHI Vs  STATE OF HARYANA & ANOTHER

Dated: JANUARY 07th, 2026.

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Supreme Court: Even a Typing Mistake Can Invalidate a Cheque Bounce Notice

 From the afore-stated reiterative

pronouncements and the principles propounded by the

courts, the position of law that emerges is that the notice

demanding the payment of the amount covered by the

dishonoured cheque is one of the main ingredients of the

offence under Section 138 of the NI Act. In the event of the

main ingredient not being satisfied on account of

discrepancy in the amount of cheque and one mentioned

in the notice, all proceedings under Section 138 of the NI

Act would fall flat as bad in law. The notice to be issued

under Proviso (b) to Section 138 of the Act, must mention

the same amount for which the cheque was issued. It is

mandatory that the demand in the statutory notice has to

be the very amount of the cheque. After mentioning the

exact cheque amount, the sender of the service may claim

in the notice amounts such as legal charges, notice

charges, interest and such other additional amounts,

provided the cheque amount is specified to be demanded

for payment. {Para 8}

8.1 A failure in above regard, namely when the

cheque amount is not mentioned in the Proviso (b) notice

or the amount different than the actual cheque amount is

mentioned, in the notice, such notice would stand invalid

in eye of law. The notice in terms of Proviso (b) being a

provision in penal statute and a condition for the offence,

it has to be precise while mentioning of the amount of the

cheque which is dishonoured. Even if the cheque details

are mentioned in the notice but corresponding amount of

cheque is not correctly mentioned, it would not bring in

law the validity for such notice. Here the principle of

reading of notice as a whole is inapplicable and

irrelevant. Any elasticity cannot be adopted in the

interpretation. It has to be given technical interpretation.

Reportable

IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL NOS._______ OF 2025

(@SPECIAL LEAVE PETITION (CRL.) NOS. 11184-11185/2024)

KAVERI PLASTICS Vs  MAHDOOM BAWA BAHRUDEEN NOORUL

Author: N.V. ANJARIA, J.

Dated: SEPTEMBER 19, 2025.

Citation: 2025 INSC 1133.

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Mastering District Judge Interviews: Essential Q&A on Pre-Cognizance, Revision, Loan Disputes & reply notice by accused in cheque bounce case

These Interview questions are based on supreme court judgment  Sanjabij Tari Vs. Kishore S. Borcar and Ors. Decided On: 25.09.2025,Citation: 2025 INSC 1158, MANU/SC/1336/2025.

Read full judgment here: Click here.

 Pre-cognizance Stage

Q1: What is the Supreme Court's directive regarding issuance of summons at the pre-cognizance stage in complaints under Section 138 of the NI Act?

A1: The Supreme Court has agreed with the Karnataka High Court's view that there is no requirement for the Magistrate to issue summons to the accused at the pre-cognizance stage in complaints under Section 138 of the NI Act, recognizing the NI Act as a special enactment. This means cognizance can be taken without waiting for the formal issuance of summons as per Section 223 of BNSS.

Revision Jurisdiction

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Cheque Bounce Case Maintainable Even For Cash Loan Above ₹20,000 : Supreme Court Sets Aside Kerala High Court Ruling

Recently, the Kerala High Court in P.C. Hari v. Shine Varghese and Anr.,   MANU/KE/2702/2025 has taken the view that a debt created by a cash transaction above Rs. 20,000/- (Rupees Twenty Thousand) in violation of the provisions of Section 269SS of the Income Tax Act, 1961 (for short 'IT Act, 1961') is not a 'legally enforceable debt' unless there is a valid explanation for the same, meaning thereby that the presumption Under Section 139 of the Act will not be attracted in cash transactions above Rs. 20,000/- (Rupees Twenty Thousand).

{Para 19}

20. However, this Court is of the view that any breach of Section 269SS of the IT Act, 1961 is subject to a penalty only Under Section 271D of the IT Act, 1961. Further neither Section 269SS nor 271D of the IT Act, 1961 state that any transaction in breach thereof will be illegal, invalid or statutorily void. Therefore, any violation of Section 269SS would not render the transaction unenforceable Under Section 138 of the NI Act or rebut the presumptions Under Sections 118 and 139 of the NI Act because such a person, assuming him/her to be the payee/holder in due course, is liable to be visited by a penalty only as prescribed. Consequently, the view that any transaction above Rs. 20,000/- (Rupees Twenty Thousand) is illegal and void and therefore does not fall within the definition of 'legally enforceable debt' cannot be countenanced. Accordingly, the conclusion of law in P.C. Hari (supra) is set aside.

 IN THE SUPREME COURT OF INDIA

Criminal Appeal No. 1755 of 2010

Decided On: 25.09.2025

 Sanjabij Tari Vs. Kishore S. Borcar and Ors.

Hon'ble Judges/Coram:

Manmohan and N.V. Anjaria, JJ.

Author: Manmohan, J.

Citation: 2025 INSC 1158.

Read full judgment here: Click here.

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Supreme Court Issues Directions For Speedy Trial Of Cheque Bounce Cases : No Need For Pre-Cognizance Summons To Accused In S.138 NI Act Case

E. Recently, the High Court of Karnataka in Ashok v. Fayaz Aahmad   MANU/KA/1743/2025 has taken the view that since NI Act is a special enactment, there is no need for the Magistrate to issue summons to the Accused before taking cognizance (Under Section 223 of BNSS) of complaints filed Under Section 138 of NI Act. This Court is in agreement with the view taken by the High Court of Karnataka. Consequently, this Court directs that there shall be no requirement to issue summons to the Accused in terms of Section 223 of BNSS i.e., at the pre-cognizance stage.

F. Since the object of Section 143 of the NI Act is quick disposal of the complaints Under Section 138 by following the procedure prescribed for summary trial under the Code, this Court reiterates the direction of this Court in In Re: Expeditious Trial of cases Under Section 138 of NI Act (supra) that the Trial Courts shall record cogent and sufficient reasons before converting a summary trial to summons trial. To facilitate this process, this Court clarifies that in view of the judgment of the Delhi High Court in Rajesh Agarwal v. State and Anr., MANU/DE/1838/2010, the Trial Court shall be at liberty (at the initial post cognizance stage) to ask questions, it deems appropriate, Under Section 251 Code of Criminal Procedure/Section 274 BNSS, 2023 including the following questions:

(i) Do you admit that the cheque belongs to your account? Yes/No

(ii) Do you admit that the signature on the cheque is yours? Yes/No

(iii) Did you issue/deliver this cheque to the complainant? Yes/No

(iv) Do you admit that you owed liability to the complainant at the time of issuance? Yes/No

(v) If you deny liability, state clearly the defence:

(a) Security cheque only;

(b) Loan repaid already;

(c) Cheque altered/misused;

(d) Other (specify).

(vi) Do you wish to compound the case at this stage? Yes/No

G. The Court shall record the responses to the questions in the order-sheet in the presence of the Accused and his/her counsel and thereafter determine whether the case is fit to be tried summarily under Chapter XXI of the Code of Criminal Procedure/Chapter XXII of the BNSS, 2023.

 IN THE SUPREME COURT OF INDIA

Criminal Appeal No. 1755 of 2010

Decided On: 25.09.2025

 Sanjabij Tari Vs. Kishore S. Borcar and Ors.

Hon'ble Judges/Coram:

Manmohan and N.V. Anjaria, JJ.

Author: Manmohan, J.

Citation: 2025 INSC 1158, MANU/SC/1336/2025.

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Section 138 NI Act: Supreme Court's Latest Guidelines on Compounding Cheque Bounce Cases (September 2025)

The Supreme Court has recently revised the guidelines for compounding dishonour of cheque cases under Section 138 of the Negotiable Instruments Act, 1881, in the judgment of Sanjabij Tari vs Kishore S. Borcar & Others, 2025, dated September 25, 2025. This modification represents a significant departure from the previous framework established in Damodar S. Prabhu vs Sayed Babalal H. (2010).

Read full judgment here: Click here.

Original Damodar Prabhu Guidelines (2010)

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The Signature That Never Was: A Tale of Forensic Truth and Legal Justice

 When Ink Tells a Different Story

In a busy commercial court, where large sums change hands on the strength of a signature, a peculiar dispute challenged everything about trust, evidence, and the art of proving authenticity. A lender claimed repayment via a bounced cheque bearing a borrower’s signature—yet the borrower insisted, “I never signed that cheque.”

The Mysterious Loan

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Authorization Lapse in Cheque Bounce Cases: Dismiss or Decide Later?

Understanding the Law on Maintainability and Judicial Approach under Section 138 NI Act

The filing of a complaint under Section 138 of the Negotiable Instruments Act, 1881 (NI Act) requires that the complainant — whether an individual or a company — be duly entitled or authorized to initiate legal proceedings. But what happens when a complaint is filed by a person on behalf of a company without proper authorization? Should the court dismiss the complaint at the outset, or can this issue wait until the final hearing? And if an accused challenges this at the preliminary stage, is a criminal revision against rejection of such a plea maintainable?

This article examines these issues through the lens of Supreme Court and Bombay High Court precedents.

1. Is the Magistrate’s Order Rejecting Accused’s Objection Interlocutory?

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Supreme Court : Procedural defects and irregularities in criminal complaint which are curable, should - not be allowed to defeat substantive rights or to cause injustice

Having heard learned Counsel for the parties and after perusing the material on record, we find that admittedly authorisation by the Board of Directors of the Appellant -Federation was not placed before the Courts below. But, we may notice that a specific averment was made by the Appellant -Federation before the learned Judicial Magistrate that the said General Power of Attorney has been filed in connected case being CC No. 1409/1995, which has neither been denied nor disputed by the Respondents. In any case, in our opinion, if the Courts below were not satisfied, an opportunity ought to have been granted to the Appellant -Federation to place the document containing authorisation on record and prove the same in accordance with law. This is so because procedural defects and irregularities, which are curable, should - not be allowed to defeat substantive rights or to cause injustice. Procedure, a hand-maiden to justice, should never be made a tool to deny justice or perpetuate injustice, by any oppressive or punitive use. {See Uday Shankar Triyar v. Ram Kalewar Prasad Singh   MANU/SC/2173/2005 : (2006) 1 SCC 75}. {Para 7}

 IN THE SUPREME COURT OF INDIA

Criminal Appeal No. 833 of 2014 

Decided On: 07.04.2014

Haryana State Coop. Supply and Marketing Federation Ltd. Vs. Jayam Textiles and Ors.

Hon'ble Judges/Coram:

P. Sathasivam, C.J.I., Ranjan Gogoi and N.V. Ramana, JJ.

Author: N.V. Ramana, J.

 Citation: 2014 INSC 254,MANU/SC/0304/2014

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Supreme Court: The court should not dismiss criminal complaint U/S 138 of NI Act at the threshold only on the ground that complainant was not authorized to file complaint?

 A Company can file a complaint only through human agency. The person who presented the complaint on behalf of the Company claimed that he is the authorised representative of the company. Prima facie, the trial court should have accepted it at the time when a complaint was presented. If it is a matter of evidence when the accused disputed the authority of the said individual to present the complaint, opportunity should have been given to the complainant to prove the same, but that opportunity need be given only when the trial commences. The dismissal of the complaint at the threshold on the premise that the individual has not produced certified copy of the resolution appears to be too hasty an action.

 IN THE SUPREME COURT OF INDIA

Criminal Appeal No. 1330 of 1999.

Decided On: 10.12.1999

Samrat Shipping Co. Pvt. Ltd. Vs. Dolly George

Hon'ble Judges/Coram:

K.T. Thomas and M.B. Shah, JJ.

Author: K.T. Thomas, J.

Citation: MANU/SC/1300/1999,(2002) 9 SCC 455.

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Supreme court: Complaint U/S 138 of NI Act can Be Amended Even After Cognizance Is Taken

 The issue, whether a criminal court has power to order

amendment of a complaint filed under Section 200 of the Cr.P.C.,

is no longer res integra. In S.R. Sukumar v. S.Sunaad Raghuram (2015) 9 SCC 609, this Court held as under:-

“19. What is discernible from U.P. Pollution Control Board

case is that an easily curable legal infirmity could be cured

by means of a formal application for amendment. If the

amendment sought to be made relates to a simple infirmity

which is curable by means of a formal amendment and by

allowing such amendment, no prejudice could be caused to

the other side, notwithstanding the fact that there is no

enabling provision in the Code for entertaining such

amendment, the court may permit such an amendment to be

made. On the contrary, if the amendment sought to be made

in the complaint does not relate either to a curable infirmity

or the same cannot be corrected by a formal amendment or

if there is likelihood of prejudice to the other side, then the

court shall not allow such amendment in the complaint.”

Hence, it is fallacious to contend that in no circumstance can

amendments to complaints be allowed after cognizance is taken.

{Para 8}

REPORTABLE

IN THE SUPREME COURT OF INDIA

CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL NO. OF 2025

(@ SPECIAL LEAVE PETITION (CRL.) NO.15699 OF 2024)

Bansal Milk Chilling Centre  Vs Rana Milk Food Private Ltd. & Anr. 

Author: K.V. Viswanathan, J.

Citation: 2025 INSC 899

Dated: 25th July, 2025.

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J & K HC: Magistrate may issue pre-cognizance notice to the accused as per S 223 of BNSS in cheque bounce case

 Section 223 BNSS provides for issuance of pre-cognizance notice to the accused and said provision was not available in the corresponding Section 200 of the repealed Code. Such requirement provided under Section 223 of the BNSS by way of proviso appear to be justice orientated as the same takes care of any legitimate defence of the accused to be appreciated by the Magistrate even at an earliest, while holding a preliminary inquiry and is not barred at all even in respect of complaints under N.I. Act as hereinabove discussed. However, the non-observance of the requirements, provided under Section 223 BNSS, regarding the examination on oath of the complainant/witnesses and the issuance of the pre-cognizance notice shall not render the proceedings invalid. {Para 10}

11. The satisfaction of the competent Court, as regards the maintainability of the complaint, in terms of the accrual of cause of action, is covered under the “inquiry phase,” preceding the “taking of cognizance”. A Magistrate while entertaining a complaint under Section 138 of the Negotiable Instruments Act is not barred to have the observance of the provisions providing for pre-cognizance notice.

In the High Court of Jammu and Kashmir

(Before Mohd. Yousuf Wani, J.)

Mohd. Afzal Beigh Vs  Noor Hussain 

CRM(M) No. 374/2025 and CrlM No. 742/2025

Decided on May 2, 2025

Citation: 2025 SCC OnLine J&K 394. REad full Judgment here: Click here.

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J & K HC: Magistrate should not issue non-bailable warrant against accused at pre-cognizance stage of the complaint U/S 138 of NI Act

 So far as the case in hand is concerned, the learned Magistrate upon satisfying himself regarding to record the service of pre-cognizance notice could have inferred, the forfeiture of the right of hearing by the accused at pre-cognizance stage of the complaint and proceeded ahead on the complaint in accordance with law. There was no need for the Magistrate to compel the appearance of the accused by issuance of a subsequent nonbailable warrant as the pre-cognizance hearing was meant for him which he acquiesced. The Magistrate is within its powers to compel the attendance of the accused after taking cognizance on the complaint and even under such circumstances, the normal approach of the Magistrates should be issuance of summon followed by a bailable warrant if needed and the issuance of the non-bailable warrants should be the last option.{Para 12}

In the High Court of Jammu and Kashmir

(Before Mohd. Yousuf Wani, J.)

Mohd. Afzal Beigh Vs  Noor Hussain 

CRM(M) No. 374/2025 and CrlM No. 742/2025

Decided on May 2, 2025

Citation: 2025 SCC OnLine J&K 394

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Bombay HC: When substantive rights of accused are violated, said order will be intermediate order and criminal revision is maintainable against said order

 Here in this case, the learned Magistrate applied that provision of law which was not at all applicable to the case in hand before him, therefore, definitely it had affected the right of the accused. Consequently it cannot be said that, the order which was passed by the learned Magistrate was purely "interlocutory order" as contemplated under Section 397 (2) of Code of Criminal Procedure. The learned Additional Sessions Judge was justified in setting aside the said order by exercising his power under Section 397 (1) of Code of Criminal Procedure. There is no merit in the present writ petition much less to invoke the constitutional powers of this Court under Article 226 and 227, hence the writ petition is hereby dismissed. Rule is discharged. {Para 11}

 IN THE HIGH COURT OF BOMBAY (AURANGABAD BENCH)

Criminal Writ Petition No. 1848 of 2019

Decided On: 11.12.2019

Hitendra Vs. Shankar and Ors.

Hon'ble Judges/Coram:

Vibha Kankanwadi, J.

Citation:  MANU/MH/3561/2019.

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Interim Compensation In Cheque Dishonour Cases U/S 143A NI Act Isn't Mandatory : Supreme Court Lays Down Broad Parameters

19. Subject to what is held earlier, the main conclusions can be summarised as follows:

a. The exercise of power Under Sub-section (1) of Section 143A is discretionary. The provision is directory and not mandatory. The word "may" used in the provision cannot be construed as "shall."

b. While deciding the prayer made Under Section 143A, the Court must record brief reasons indicating consideration of all relevant factors.

c. The broad parameters for exercising the discretion Under Section 143A are as follows:

i. The Court will have to prima facie evaluate the merits of the case made out by the complainant and the merits of the defence pleaded by the Accused in the reply to the application. The financial distress of the Accused can also be a consideration.

ii. A direction to pay interim compensation can be issued, only if the complainant makes out a prima facie case.

iii. If the defence of the Accused is found to be prima facie plausible, the Court may exercise discretion in refusing to grant interim compensation.

iv. If the Court concludes that a case is made out to grant interim compensation, it will also have to apply its mind to the quantum of interim compensation to be granted. While doing so, the Court will have to consider several factors such as the nature of the transaction, the relationship, if any, between the Accused and the complainant, etc.

v. There could be several other relevant factors in the peculiar facts of a given case, which cannot be exhaustively stated. The parameters stated above are not exhaustive.

 IN THE SUPREME COURT OF INDIA

Criminal Appeal No. 741 of 2024

Decided On: 15.03.2024

Rakesh Ranjan Shrivastava Vs. The State of Jharkhand and Ors.

Hon'ble Judges/Coram:

Abhay Shreeniwas Oka and Ujjal Bhuyan, JJ.

Author: Abhay Shreeniwas Oka, J.

 Citation: 2024 INSC 205,MANU/SC/0204/2024.

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Supreme Court Recognizes Complainant as Victim, Grants Unconditional Appeal Right in Cheque Bounce Acquittals

 Background

In a significant judgment delivered on April 8, 2025, the Supreme Court of India addressed a crucial legal question: Can a complainant in a cheque dishonour case under Section 138 of the Negotiable Instruments Act, 1881, appeal an acquittal order as a "victim" under the proviso to Section 372 of the Code of Criminal Procedure (CrPC), without seeking special leave under Section 378(4) of the CrPC? This issue arose in the case of M/s. Celestium Financial v. A. Gnanasekaran & Others, where the appellant, a financial firm, sought to challenge the acquittal of borrowers who had defaulted on multiple loans and whose cheques were dishonoured due to insufficient funds.

Read full judgment here: Click here.

Factual Matrix

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