M/S Sacred Heart Souharda Credit Co-Operative Limited Vs… — Cheque Dishonour | Karnataka HC (2026)

M/S Sacred Heart Souharda Credit Co-Operative Limited Vs… — Cheque Dishonour | Karnataka HC (2026)

What the court decided

AI extract

Outcome

Appeal disposed of by transfer: Registry to transfer the entire record (including requisitioned trial court records) to the concerned Principal District & Sessions Judge for assignment to the jurisdictional appellate Court; appeal to be considered and numbered as an appeal under the proviso to Section 413 of BNSS, 2023 (formerly Section 372 Cr.P.C.); transferee Court to issue Court notice to both parties and proceed in accordance with law; pending applications (including condonation of delay) to be transferred and considered by the transferee Court; expeditious disposal requested; appellant permitted to amend the cause-title; no observations on merits, all rights and contentions left open.

Issue for consideration

Whether the complainant under Section 138 of the Negotiable Instruments Act, 1881, being a 'victim', is entitled to prefer an appeal against the judgment of acquittal before the Sessions Court under the proviso to Section 372 Cr.P.C. (now the proviso to Section 413 of BNSS, 2023) instead of proceeding under Section 378(4) Cr.P.C. before the High Court. +1 more

Court's answer

In view of the Hon'ble Supreme Court's recent clarification in Celestium Financial, the appellant, being the complainant under Section 138 of the Negotiable Instruments Act, 1881, is a 'victim' 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 this stage, it could deprive the parties of an available forum (this Court) for further challenge; this is the rationale for directing transfer.

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¶43
The Court has made no observations on the merits of the case; all rights and contentions of the parties are left open to be agitated before the Court concerned.ratio¶56

Detailed headnote1 paragraphs

Criminal Appeal (CRL.A No. 387 of 2018) under S. 378(4) Cr.P.C. by complainant against judgment of acquittal dated 03.01.2018 in C.C. No. 2039/2009 (II Addl. Civil Judge & JMFC, Tumkuru) for offence under S. 138 of the Negotiable Instruments Act, 1881 — Held: following Celestium Financial v. A Gnanasekaran, 2025 SCC OnLine SC 1320, a complainant under S. 138 NI Act is a 'victim' entitled to prefer an appeal against acquittal before the Sessions Court under the proviso to S. 372 Cr.P.C., now the proviso to S. 413 of BNSS, 2023; hearing the appeal in the High Court would deprive the parties of an available forum for further challenge — appeal disposed of with directions: Registry to transfer entire record (including requisitioned trial court records) to the concerned Principal District & Sessions Judge for assignment to the jurisdictional appellate Court and numbering as an appeal under the proviso to S. 413 BNSS; transferee Court to issue notice and proceed in accordance with law; pending applications including condonation of delay to be considered by transferee Court; expeditious disposal requested; liberty to amend cause-title — no observations on merits; all rights and contentions left open. Similar views noted of the High Courts of Andhra Pradesh, Madhya Pradesh, Chhattisgarh and Delhi, and of the Karnataka High Court including a coordinate Bench.

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

DATED THIS THE 20^TH DAY OF JANUARY, 2026

BEFORE

THE HON'BLE MR. JUSTICE G BASAVARAJA CRIMINAL APPEAL NO. 387 OF 2018 (A)

BETWEEN:

M/S SACRED HEART SOUHARDA CREDIT CO-OPERATIVE LIMITED HORPTE, TUMKUR - 572 101

REPRESENTED BY ITS MANAGER J.SHEKHAR, S/O P JAYARAM, AGED ABOUT 41 YEARS, R/O 8TH CROSS, S.S.PURAM, TUMKUR - 572 101.

…APPELLANT

(BY SRI. RAMESH K R., ADVOCATE)

AND:

Digitally signed by SHARADAVANI B Location: High Court of Karnataka

SRI CHIKKASIDDAIAH S/O LATE CHIKKASWAMAPPA S 7TH CROSS, CM EXTENSION KESARUMADU ROAD KYATASANDRA TUMKUR - 572 102.

…RESPONDENT (BY SRI. FAYAZ SAB B G .,ADVOCATE) THIS CRIMINAL APPEAL IS FILED U/S 378(4) CR.P.C PRAYING TO SET ASIDE THE JUDGMENT DATED 03.01.2018 PASSED BY THE II ADDITIONAL CIVIL JUDGE AND JMFC, TUMKURU IN C.C.NO.2039/2009 ACQUITTING THE RESPONDENT/ACCUSED FOR THE OFFENCE PUNISHABLE UNDER SECITON 138 ON N.I ACT.

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THIS CRIMINAL APPEAL, COMING ON FOR FINAL HEARING, 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 03.01.2018 passed in C.C No.2039/2009 by the II

Addl. Civil Judge and JMFC, Tumkuru (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

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appeal under the proviso to Section 372 of Cr. 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

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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-

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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

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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;

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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

TKN

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