The Punjab and Haryana High Court has remanded six connected petitions to their respective Appellate Courts for a fresh decision regarding the condition of depositing 20% of the compensation amount for the suspension of sentence in Cheque Bounce cases. The Bench of Justice Sanjay Vashisth directed that until fresh orders are passed, the condition of depositing 20% of the compensation amount shall remain inoperative, and the bail of the petitioners shall not be cancelled.
The Court relied on the recent ruling of the Larger Bench in M/s Coromandel International Limited v. Shri Ambica Sales Corporation, emphasizing that while the condition to deposit 20% is sustainable, the right to bail cannot be taken away solely due to non-compliance if valid reasons exist, and the deposit is not a pre-condition for deciding an appeal.
Background of the Proceedings
The High Court was hearing six separate petitions filed under Section 528 of the Bharatiya Nagarik Suraksha Sanhita (BNSS), 2023. The petitioners challenged orders passed by various Appellate Courts (Additional Sessions Judges in Hisar, Sangrur, Fazilka, Kurukshetra, and Gurugram) which had suspended their sentences during the pendency of their appeals against conviction under Section 138 of the Negotiable Instruments Act, 1881 (NI Act), subject to the condition that they deposit 20% of the compensation amount awarded by the Trial Court.
In these cases, the Appellate Courts had directed the appellants to deposit the amount within a stipulated time, failing which the suspension of sentence would be vacated. For instance, in CRM-M-38097-2025 (Harvinder Singh Saggu vs. Sushil Kumar), the petitioner was directed to deposit 20% of the Rs. 5,25,000 compensation. Despite the petitioner’s plea of financial incapacity—citing an income of Rs. 40,000 per month—the Appellate Court ruled that no “exceptional circumstances” were made out to dispense with the payment.
Similarly, in CRM-M-42330-2025, the Appellate Court dismissed an application for waiver of the condition, citing the bar under Section 362 of the Cr.P.C. (Section 403 of BNSS) against altering judgments.
Observations of the Court and Legal Analysis
Justice Sanjay Vashisth referred to the decision of the Larger Bench/Division Bench of the High Court dated September 24, 2025, in M/s Coromandel International Limited v. Shri Ambica Sales Corporation, which answered specific questions of law regarding Section 148 of the NI Act.
The Court reproduced the specific answers provided by the Larger Bench:
- Sustainability of the Condition: The imposition of the condition to deposit 20% of the compensation amount is sustainable while deciding an application for suspension of sentence.
- Effect of Non-Compliance: While non-compliance with the condition can lead to the vacation of the suspension of sentence, the right of bail cannot be taken away by the Appellate Court where the final adjudication of the appeal is pending, solely due to non-compliance, if “justifiable reasons” exist.
- No Pre-condition for Deciding Appeal: The Court clarified that depositing 20% of the compensation is not a pre-condition for getting an appeal decided.
The judgment quoted the Larger Bench’s observation:
“Whenever the deposits are expensive than the liberty, and the Appellate Courts are convinced that the convicts are not in a position to deposit and likely to forego their liberty even when the first appeal is yet to be decided, the Appellate Courts must make efforts to prioritize hearing appeals filed against the convictions under Section 148 NI Act and decide those preferably within sixty days of filing.”
The Court noted that Section 148 of the NI Act does not explicitly prohibit the suspension of sentence for non-compliance, and Section 430 of the BNSS, 2023 (corresponding to Section 389 Cr.P.C.) applies to restore liberty post-conviction until the appeal is decided.
Decision and Directions
The High Court disposed of the petitions by setting aside the rigid enforcement of the deposit condition in the interim and issued the following directions:
- Remand for Fresh Decision: The matters are sent back to the respective Appellate Courts to decide afresh in consonance with the law laid down in the M/s Coromandel International Limited case.
- Timeline: This exercise must be undertaken by the Appellate Courts within 15 days from the receipt of the order.
- Interim Protection: Until a fresh order is passed, the condition of depositing 20% of the compensation amount “shall remain inoperative, and the bail shall not be cancelled in consequence thereof.”
- Prioritizing Appeals: If the Appellate Court finds that a convict is unable to deposit the amount and would otherwise lose their liberty, it must prioritize hearing the appeal, deciding it preferably within sixty days of passing the fresh order, and not later than ninety days.
Case Details
- Case Title: Harvinder Singh Saggu vs. Sushil Kumar And Another (and connected cases)
- Case No.: CRM-M-28757-2025 & 05 connected cases
- Coram: Justice Sanjay Vashisth
