Complainant Has Right to Appeal Without Leave in Negotiable Instruments Act Case
Apex Court Dismisses Radhika Traders' Plea, Reinforces Complainant's Entitlement Under Section 138 of the Negotiable Instruments Act
In a landmark judgment, the Supreme Court of India upheld the right of complainants to appeal against acquittals in cases under Section 138 of the Negotiable Instruments Act, 1881, without requiring prior leave from the court under Section 378(4) of the Criminal Procedure Code (CrPC). This decision came in response to a special leave petition filed by M/s Radhika Traders against M/s Ashtalaxmi Trading Company and another.
The case originated when M/s Radhika Traders was acquitted by a trial court on 23rd August 2024 in a complaint lodged under Section 138 of the Negotiable Instruments Act, which deals with the dishonor of cheques. Dissatisfied with this acquittal, the complainant, M/s Ashtalaxmi Trading Company, filed an appeal which was subsequently remanded by the High Court for fresh consideration.
Radhika Traders challenged this remand on three primary grounds. Firstly, they alleged that they were not notified before the High Court's remand order. Secondly, they contended that the appeal was not maintainable since no court leave was sought. Lastly, they argued that the appeal was time-barred.
The Supreme Court, in its judgment dated 15th September 2025, dismissed all three contentions. The bench, comprising Justices Pankaj Mithal and Prasanna B. Varale, noted that the petitioners had knowledge of the proceedings and had engaged counsel, thereby invalidating their claim of not being notified.
On the question of maintainability of the appeal, the Supreme Court referenced its decision in the case of Celestium Financial v. A. Gnanasekaran, which clarified that a complainant under Section 138 of the Negotiable Instruments Act is entitled to file an appeal against an acquittal without needing special leave under Section 378(4) of the CrPC. This ruling extended the benefit of the proviso to Section 372 of the CrPC to such complainants, affirming their right to appeal independently.
Regarding the argument of the appeal being time-barred, the court observed that the appeal was filed on 29th October 2024, following the trial court's judgment on 23rd August 2024, thus falling within the permissible time frame.
Concluding its judgment, the Supreme Court directed the trial court to expediently reconsider the matter pursuant to the remand order, ensuring a swift resolution in accordance with the law. This decision not only reaffirms the rights of complainants under the Negotiable Instruments Act but also sets a significant precedent in the legal framework governing cheque dishonor cases.
M/s Radhika Traders v. M/s Ashtalaxmi Trading Company, (SC) : Law Finder Doc Id # 2780859
