M/S Jaswantha Traders Vs K K Nagaraju — Cheque Dishonour | Karnataka HC (2026)

M/S Jaswantha Traders Vs K K Nagaraju — Cheque Dishonour | Karnataka HC (2026)

What the court decided

AI extract

Outcome

Appeal disposed of with directions: (i) Registry to transfer the entire record, including requisitioned trial court copies, to the concerned Principal District & Sessions Judge for assignment to the concerned appellate Court having jurisdiction; (ii) transferee court to issue Court notice to both parties and proceed in accordance with law; (iii) pending applications, including for condonation of delay, to be transferred and considered by the learned Judge of the transferee Court in accordance with law; (iv) appellate Court requested to dispose of the matter expeditiously; (v) appellant permitted to carry out necessary amendment in the cause-title and provisions thereof; (vi) express reservation that no observations were made on the merits and all rights and contentions of the parties are left open.

Issue for consideration

Whether the appeal filed by the complainant/appellant under Section 378(4) Cr.P.C. against the judgment of acquittal in a Section 138 NI Act case should be entertained and decided by the High Court, or transferred to the Sessions Court to be considered as an appeal under the proviso to Section 372 Cr.P.C. / proviso to Section 413 BNSS, 2023, the complainant being a victim.

Court's answer

Following the Supreme Court's clarification in Celestium Financial (2025 SCC OnLine SC 1320, para 10), the appellant, being the complainant under Section 138 of the Negotiable Instruments Act, 1881, is considered to be a victim and is entitled to file an appeal against the judgment of acquittal passed by the trial Court before the Sessions Court.

Ratio / Principle

If the High Court were to proceed to hear and decide the appeal at that stage, it could deprive the parties of an available forum (i.e., the Sessions Court) for further challenge.

Key takeaways

The present appeal is to be transferred to the concerned appellate Court of Sessions and considered as an appeal under the proviso to Section 413 of BNSS, 2023 (formerly Section 372 of Cr.P.C.) and numbered accordingly.ratio¶41

Detailed headnote1 paragraphs

NC 2026:KHC:7218 — Criminal Appeal (CRL.A No. 2211 of 2024) filed by the complainant under S. 378(4) Cr.P.C. (filed u/s 419(4) BNSS) against acquittal dated 02.08.2024 in C.C.No.978/2017 (JMFC Mandya) in a complaint under S. 138, Negotiable Instruments Act, 1881: relying on Celestium Financial v. A Gnanasekaran, 2025 SCC OnLine SC 1320 (para 10), and on similar decisions of the Andhra Pradesh, Madhya Pradesh, Chattisgarh and Delhi High Courts and of the Karnataka High Court, the Court held that the complainant under S. 138 NI Act is a victim entitled to prefer the appeal before the Sessions Court under the proviso to S. 372 Cr.P.C., i.e., the proviso to S. 413 BNSS, 2023, and that hearing the matter further in the High Court could deprive the parties of an available forum. Appeal disposed of by directing transfer of the entire record to the Principal District & Sessions Judge, to be assigned to the jurisdictional appellate Court and numbered as an appeal under the proviso to S. 413 BNSS, with notice to parties, transfer of pending applications (including condonation of delay), a request for expeditious disposal, liberty to amend the cause-title, and an express reservation that no observations were made on merits, all rights and contentions left open.

1 -

NC: 2026:KHC:7218 CRL.A No. 2211 of 2024

HC-KAR

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 6^TH DAY OF FEBRUARY, 2026

BEFORE

THE HON'BLE MR. JUSTICE G BASAVARAJA CRIMINAL APPEAL NO. 2211 OF 2024 (A-)

BETWEEN:

M/S JASWANTHA TRADERS WHOLESALE FERTILIZER DEALERS HOLALU VILLAGE, DUDDA HOBLI, MANDYA THALUK, REP BY ITS PROPRIETOR H.C.PUTTA SWAMY

…APPELLANT

(BY SRI. SHANKAR H.S., ADVOCATE)

AND:

K.K. NAGARAJU AGED ABOUT 42 YEARS, PRIMARY AGRICULTURE

Digitally signed by MARKONAHALLI RAMU PRIYA Location: HIGH COURT OF KARNATAKA

CO-OPERATIVE SOCIETY LTD., KOMMERALLI VILLAGE, KASABA HOBLI, MANDYA THALUK.

…RESPONDENT THIS CRL.A IS FILED UNDER SECTION 378(4) OF THE CR.PC (FILED U/S 419(4) OF BNSS) PRAYING TO SET ASIDE THE JUDGMENT AND ORDER OF ACQUITTAL PASSED BY JUDICIAL MAGISTRATE FIRST CLASS AT MANDYA IN C.C.NO.978/2017 ORDER DATED 02.08.2024 BY ALLOWING THIS APPEAL AND TO CONVICT THE RESPONDENT / ACCUSED, AND TO PASS SUCH OTHER ORDER.

2 -

NC: 2026:KHC:7218 CRL.A No. 2211 of 2024

HC-KAR

THIS APPEAL, COMING ON FOR ORDERS, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:

CORAM: HON'BLE MR. JUSTICE G BASAVARAJA

ORAL JUDGMENT

This appeal is filed by the appellant/

complainant being aggrieved by the judgment of acquittal dated 02.08.2024 passed in C.C.No.978/2017 by the Court of Judicial Magistrate of the First Class, at Mandya (for short "the trial Court").

The Hon'ble Supreme Court in the case of CELESTIUM FINANCIAL v. A GNANASEKARAN ETC. reported in 2025 SCC ONLINE SC 1320, at paragraph 10 of the judgment, has observed as under:

" 10. As already noted, the proviso to Section 372 of Cr.P.C. was inserted in the statue book only with effect from 31.12.2009. The object and reason for such insertion must be realised and must be given its full effect to by a court. In view of the aforesaid discussion, we hold that the victim of an offence has the right to prefer an appeal under the proviso to Section 372 of Cr.

3 - NC: 2026:KHC:7218 CRL.A No. 2211 of 2024

HC-KAR

P.C., irrespective of whether he is a complainant or not. Even if the victim of an offence is a complainant, he can still proceed under the proviso to Section 372 and need not advert to sub-section (4) of Section 378 of Cr. P.C. "

In the light of the Hon'ble Supreme Court's

recent clarification of the legal position, it is now evident that the appellant, being the complainant under Section 138 of Negotiable Instruments Act, 1881, is also entitled to file an appeal against the judgment of acquittal passed by the trial Court before the Sessions Court, since he is considered to be a victim. If this Court were to proceed to hear and decide the appeal at this stage, it could deprive the parties of an available forum, i.e. this Court, for further challenge.

Similar view has been taken by the High Court of Andhra Pradesh in CHARBEL INDIA V. STATE OF ANDHRA PRADESH reported in 2025 SCC ONLINE AP 2815; by the High Court of Madhya Pradesh in MANORAMA

4 - NC: 2026:KHC:7218 CRL.A No. 2211 of 2024

HC-KAR

KANKANE v. NARENDRA KUMAR SHUKLA rendered in Criminal Appeal No.5910 of 2025 decided on 03^rd July, 2025; and in the case of LATE KISAN SEWA KENDRA v. PRITAM SINGH reported in 2025 SCC ONLINE MP 4818; and in SMT. URMIT MADRAH v. SAMARPAN JAIN rendered

Criminal Appeal No. 11872 of 2022 decided on 21^st July, 2025; the decision of High Court of Chattisgarh in NEELAM SAHU v. NARADNAGWANSHI rendered in ACQA No. 340 of 2018 decided on 16^th July, 2025; and in SMT. KIRTI KURIAN v. AJAY SINGH rendered in ACQA No. 198 of 2019 decided on 16^th July, 2025; the judgment of this Court in the case of SIDAGONDAPPA v. SHAFI AHAMAD rendered in CRL.A. No. 20021/2018 decided on 31^st July, 2025 and in SRI T.H. LENKAPPA v. SRI SANJAY AND ANOTHER rendered in Criminal Appeal No.146 of 2015 decided on 23^rd July, 2025; the decision of High Court of Delhi in the case of D.K. ASSOCIATES v. SHANKAR AND ANOTHER rendered in Criminal Appeal No.694 of 2016 decided on 13^th November, 2025 and the decision rendered by the Co-

5 - NC: 2026:KHC:7218 CRL.A No. 2211 of 2024

HC-KAR

ordinate Bench of this Court in the case of M/S. ANANYA ENTERPRISES v. SRI G.S. GOPALAKRISHNA rendered in Criminal Appeal No.100171 of 2016 decided on 24^th November, 2025. An overall assessment of the aforestated decisions reveals that the decision of the Hon'ble Supreme

Court in the case of CELESTIUM FINANCIAL (supra) has been relied upon by this Court, as well as other High Courts across the country.

Considering the above, it is deemed fit that the

present appeal be transferred to the concerned appellate Court of Sessions and be considered as an appeal under

the proviso to Section 413 of BNSS, 2023 (formerly Section 372 of Cr.P.C) and numbered accordingly. Accordingly, I proceed to pass the following:

O R D E R

i. Registry is directed to transfer the entire record of the case, including the requisitioned copies of the trial court Records, to the concerned Principal District & Sessions Judge, who may assign it to the

6 -

NC: 2026:KHC:7218 CRL.A No. 2211 of 2024

HC-KAR

concerned Appellate Court having the jurisdiction and for which purpose, it would be listed before the Principal District & Sessions Judge;

ii. The concerned transferee court is directed to issue Court notice to both the parties to appear before the concerned Court, and the concerned Court, thereafter, shall proceed with the case in accordance with law;

iii. In case there are applications pending for condonation of delay or any other pending applications, the same also be transferred to be considered by the learned Judge of transferee Court, in accordance with law;

iv. Considering the matter has been pending for considerable time, the Appellate Court is requested to make an endeavour to dispose of the matter as expeditiously as possible;

v. The appellant is permitted to carry out necessary amendment in the cause-title and also the provisions thereof;

7 -

NC: 2026:KHC:7218 CRL.A No. 2211 of 2024

HC-KAR

vi. It is made clear that this Court has not made any observations as to the merits of the case and all rights and contentions of the parties are left open to be agitated before the Court concerned.

In the light of the above observation and

directions, appeal stands disposed of.

Sd/(G BASAVARAJA) JUDGE

BKN

List No.: 2 Sl No.: 23