The Supreme Court has held that a complainant in a case under Section 138 of the Negotiable Instruments Act, 1881, is entitled to file an appeal against an order of acquittal without seeking special leave from the court. A division bench comprising Justice Pankaj Mithal and Justice Prasanna B. Varale dismissed special leave petitions filed by an accused party who had challenged a High Court’s order remanding their cheque dishonour case back to the trial court.
The apex court’s decision clarifies the procedural rights of a complainant in cheque bounce cases, affirming that an appeal can be maintained in its own right under the proviso to Section 372 of the Code of Criminal Procedure (CrPC).
Case Background
The legal dispute originated from a complaint filed by M/s Ashtalaxmi Trading Company against M/s Radhika Traders & Ors. under Section 138 of the Negotiable Instruments Act, 1881. The trial court, in its judgment dated August 23, 2024, acquitted M/s Radhika Traders.
Aggrieved by the acquittal, the original complainant, M/s Ashtalaxmi Trading Company, preferred an appeal before the High Court for the State of Telangana at Hyderabad. The High Court, through its orders dated November 8, 2024, set aside the acquittal and remanded the matter to the trial court for fresh consideration on its merits.
M/s Radhika Traders, the accused party, subsequently filed Petitions for Special Leave to Appeal (Crl.) Nos. 6570-6571/2025 before the Supreme Court, challenging the validity of the High Court’s remand order.
Arguments of the Petitioner
Before the Supreme Court, counsel for the petitioner, M/s Radhika Traders, raised three primary contentions against the High Court’s order:
- The order of remand was passed without giving due notice to the petitioners.
- The appeal filed by the complainant before the High Court was not maintainable, as it was filed without obtaining the necessary leave of the court as prescribed under Section 378(4) of the CrPC.
- The appeal was barred by limitation, and the delay had not been condoned.
Court’s Analysis and Findings
The Supreme Court, after hearing counsel for both parties, addressed and rejected each of the petitioner’s arguments.
On the Issue of Notice: The bench found the first submission to be without merit. It pointed to the petitioners’ own application seeking condonation of delay in filing the special leave petitions, where they had “categorically stated that on the relevant date, they were out of station and that they contacted their counsel after the return which means that the petitioners had the knowledge of the proceedings and that they had engaged a counsel.” The Court concluded, “Therefore, it does not lie in the mouth of the petitioners to submit that the order of remand was passed without notice to them.”
On the Maintainability of the Appeal:
Regarding the second contention, the Court relied on its previous decision in Celestium Financial Vs. A. Gnanasekaran Etc.: 2025 SCC OnLine SC 1320. The judgment explicitly referenced paragraph 7.7 of the said decision, which held that in a case under Section 138 of the Act, “the complainant ought to be extended the benefit of the proviso to Section 372, thereby enabling him to file appeal against an order of acquittal in his own right without having to seek special leave under Section 378(4) of the CrPC.”
Based on this precedent, the Court affirmed that, “the complainant in a case under Section 138 of the Act is entitled to maintain an appeal against acquittal even without seeking the leave of the Court.”
On the Question of Limitation:
The Court found the final argument concerning the limitation period to be factually incorrect. It observed that the trial court’s judgment was delivered on August 23, 2024, and the appeal was filed on October 29, 2024. The bench summarily concluded that “the same was within time.”
Final Decision
Finding no merit in any of the contentions raised by M/s Radhika Traders, the Supreme Court dismissed the special leave petitions. The bench directed the trial court to proceed with the case as per the High Court’s remand order, instructing it “to decide the matter pursuant to the remand in accordance with law most expeditiously.” Any pending applications were also disposed of.
