The High Court · 2025

Petition under Section 528 of BNSS praying that I the circurnstances stated rn the Menorandum of Grounds of Criminal Petition. the High Court may be pleased to extend the interim order dated 1910612025 macle rn Crl P No 7352 of 2025 which was extended upto 12.09 202 till the dis;posal of the above Criminal petition l.A. NO:2OF 2025 Petition under Section 528 gf BNSS praying that i1 the circumstances stated in the Menrorandum of Grounds of Crimrnal Petrtion the Hrgh Court may be pleased to extend the rnterim order dated 1910612025 mace in Crl P No 7352 of 2025 till the disposal of the above Criminal petition This Petrtron coming on for hearing, upon perusing tl e lvlemorandum of Grounds of Criminal Petitron and upon hearing the argumr;rrts of Sri P VINOD LAL Advocate for the Petitioner and SRl. JITHENDER ttAO \/EERAMALLA, Additional Public Prosecutor on behalf of the Responde nt No 2 and of Sri S.Someshwar Rao for the Respondent No.1 The Court made the following: ORDER 7 I THE HON'BLE SMT. JUSTICE TIRUMALA DEVI EADA C RIMINAL PETITION No.7352 OF 2025 ORDER: This Criminal Petition is filed to quash the order dated 01 .04.2025 passed in Criminal Revision Petition No 06 of 2024 by the learned Vlll Additional District & Sessions Judge, Ranga Reddy District at L.B.Nagar (for short "revisional Court"), confirming the docket order dated 03.11 2023 in Crl.tM.P No.429 of 2023 in STC Nl No.543 of 2021 by the learned Judicial Magistrate of First Class, Special (Mobile) PCR Act - cum - IV Additional Junior Civil Judge - cum - lV Additional Metropolitan Magistrate, Ranga Reddy District at L.B.Nagar (for short'the trial Court').

2. Heard the submissions of Sri P.Vinod Lal, learned counsel for the petitioner, Sri S.Someshwar Rao, learned counsel for respondent No.1 and Sri Jithender Rao Veeramalla, Iearned Additional Public Prosecutor for respondent No.2 - State.

3. The learned petitioner counsel has submitted that the interim compensation under Section 143A of Negotiable lnstruments Act, 1881 (for short "Nl Act") is a discretionary relief and that the learned Judge has not assigned any reasons while granting interim a\ ) 2 compensation irr this case. He further argued that the guidelines laid down by the Apex Court in Rakesh Ranjan Shriva:;tava v. State of Jharkhandl have been overlooked by the trial C,tu(. He further submitted that the so called complainant in the Nl case was under the employment of petitioner/accused, who is in the business of workers contract under the name of Srivatsa Technocrats and due to the said acquaintance, petitioner has given loan on rjifferent spells to a tune of Rs 85,00,541/- as on 23.12.2020 and whon the same is presented for encashment to his Banker i.e., -'l-erlangana State Cooperative Apex Bank, Bandlaguda, Nagole, it was returned unpaid with a Memo dated 06.02.2021 with a reason funls insufficient'. Therefore, he raised his defeirse but still the kial Cortrt went ahead in granting the rnterim compensation without getting into the trial, hence, he prayed to set aside the orders passed by the trial Court.

4. The learned counsel for respondent No.1 ha; submitted that there are three other cases filed in different Courts and in all the three cases, the interim compensation was not grzrr.ted but in this case only it was allowed and that the complainant could make out his prima facie case as he has disclosed his capacity to lend money to the petitioner herein. He further stated that the trial Court has (2O2.1)4SCC4i() i I I I I i i 3 granted only a meager amount of Rs.6,00,000/- while the accused is due to an extent of around Rs.85,00,541/- to be paid to the complainant. He further submitted that it is a reasoned order passed by the trial Court, hence, he prayed to dismiss the petition'

5. Perused the record

6. The petitioner herein is the accused in the case filed under 138 of Nl Act and is aggrieved by the interim compensation granted by the trial Court.

7. Section 143A of the Nl Act is extracted hereunder for the sake of reference: "143A. Power to direct interim compensation'-(1) Notwithstanding anything contained in the Code of Criminat Procedure, 1973, the Court trying an offence under section 138 may order the drawer of the cheque to pay interim compensation to the complainant- (a) in a summary triat or a summons case, where he 'pl'eads not guilty to the accusation made in the complaint; (b) in any other case, upon framing of charge' (2) The interim compensation under sub-section (1) shall not exceed twenty per cent. of the amount of the cheque' (3) The interim compensation shall be paid within sixty 'days from the date of the order under subsection (1), or wiihin such further period not exceeding thirty days as \ { :e may be drrected by the Court on sufficient cause being shown by the drawer of the cheque. (4) lf tlte drawer of the cheque is acquittec the Court shatl direct the complainant to repay to the c'rawer the amount of interim compensation. with interest at the bank rate as published by the Reserve Bank of lndi'a. prevalent at the beginning of the relevant financial year, vvithin sixty days from the date of the order, or wilhin sttch further period r'tot exceeding thirty days as may be directed by the Ccurt on sufficient cause being shotryt by the complarna,nt. (5) The interim compensation payable under this seclion may be recovered as if it were a fine under sellion 421 of the Code of Criminal Procedure, 1973 (2 of 1974). (6) The amount of fine imposed under sectior 138 or the amount of compensation awarded under set.tiort 357 of the Code cf Criminal Procedure, 1973 (2 of 1974), shall be redttced by the amount paid or recovererl as tnterim compensation under this section" B. As per the guidelines laid down by the Apex rlcurt rn Rakesh Ranjan's case, the officer has to assign reasons r,rrhile awarding interim compensation under Section 1 43-A of the N I Act.

9. The trial Court has not assigned any reasonr; but has simply held that since there is a discretionary power under S,ection 143A of the Nl Act arrd that when the accused was exarrirted under 251 Cr.P.C. he has pleaded not guilty and that since it tters power under Section 143-A of Nl Act to award compensation, n the facts and circumstances, it has granted the interim compensation of 2Oo/o of ,, the cheque amount i.e. 20% of Rs.30,00,0001. The only reason assigned is that in case of acquittal, the provision itself directs for repayment of the same to the accused and therefore it has awarded, but for this there are no reasons assigned by the trial Court. However, when it went in revision, the revisional Court has dismissed the petition and it has observed that the employee i.e. complainant has filed bank statement and also the copy of registered sale deed vide document No.3656 of 2008 of the property purchased by him to an extent of 200 Sq.yards situated at lnjapur village, Hayathnagar lVlandal and also a copy of registered sale deed bearing document No.B312 of 2018 pertaining to Flat No.'l 02 in Srinivasa Residency 1 100 Sq.yards situated at Ajaynagar Colony, Bandlaguda. Thus, the revisional Court has held that the documents show the means of the complainant and that if interim compensation is paid, even if he is acquitted the accused can recover the same from the complainant, who has enough means to repay the amount. But it is surprising to note that no such documents were annexed to the revision petition.

10. The record discloses that the list of documents it is mentioned that only a certified copy of orders passed by the trial Court in Cr{.M.P.No.a29 of 2023 in STC Nl No.543 of 2021 is enclosed ) iI I ! i I I ?: i, ! z a g I It Ei i E 6 ":: Before the trial Court also, the orders do not ciis,close that any documents are filed along with the Crl.lV.P. and further a perusal of the complaint under Section 138 of the Nl Act rcveals the list of documents. ln the said list of documents also the r;aid sale deeds are not referred to. However, in case if the complainant has filed the said documents; subsequently in the Court that rnust have been mentioned in ther orders. Even if the said document:; are considered, it is not proper cn the part of the revisional Court lc assign such a reason that in c:ase of acquittal lhe complainant h ar; the means to repay the ac,;used. lt is the other way round as pe- the guidelines laid down in Rakesh Ranjan's case (supra), the capacity of the accused which lras to be considered as to whethe' he can pay the interim compens;ation

11. The Hon'ble Supreme Court ln Rakesh Ranfan's case (surpra), heid a:; under (i) The exercise of power Under Sub-section (1) of Section 143A ts discretionary. The provision is c,'irectory and not mandatory. The word "may" used in the provision cannot be construed as "sha//. " (ii) While deciding the prayer made Under Se,;tion 143A, the Court rnust record brief reasons indicating r:onsideration of all relevant factors. (iii) The broad parameters for exercising the discretion Under Section 1434 are as follows (non-exhaustive): a) The Court will have to prima facie evalu,?te the merits of the case made out by the complainant and the merits of the defence 7 pleaded by the Accused in the reply to the application. The financial dlsfress of the Accused can also be a consideration. b) A direction to pay interim compensation can be issued, only if the complainant makes out a prima facie case. c) lf the defence of the Accused is found to be prima facie plausible, the Court may exercise discretion in refusing to grant interim compensation. d) lf the Court concludes that a case ls made out to grant interim compensation, it will also have to apply its mind to the quantum of interim compensation to be granted. While doing so, the Court will have to consider several factors such as the nature of the transaction, the relationship, if any, between the Accused and the complainant, etc. e) There could be several other relevant factors in the peculiar facts of a given case, which cannot be exhaustively stated. The parameters slafed above are nol exhaustive.

12. ln Mahesh Govindraj v. The State of Andhra Pradesh and anothel , the High Court of Andhra Pradesh has held at Paragraph No.5 that: "Undisputedly, the Hon'ble Apex Court in Rakesh Ranian Shri vastava's case considered Section 1 43-A of the Negotiable lnstruments Act and power of the learned Magistrate and held that Section 143-A of the Negotiable lnstruments Act can be invoked before the conviction of the accused, and therefore, the word "may" used therein can never be construed as "shall". Ihe fesls applicable for the exercise of jurisdiction under sub-section (1) of Section 148 can never apply to the exercise of jurisdiction under sub-section (1) of Section 143-A of the Negotiable 'ca.) {o.a00 o1'2024, dated 29.01 2025 8 lnstruments Act. The Hon'ble Apex Court rn Dara No.22 of the above judgment further held that when the Court deals with an application under Section 143-A of the Nl Act, the Court will have to prima facie evaluatc the merits of the case made out by the complainant ancl the merits of the oefence pleaded by the accused in the reply to the application under sub-section (1) of Section i 43-A The presumption under Section 139 of the Nl Act, Lty ilse/f, is no ground to direct the payment of interim cornpensation. The reason is that the presumption is rebuttaLtle. lf the complainant makes out a prima facie case. er direction can be issued lo pay interim compensation e'nd the fact that the accused is in financial disfress can also be a consideration. Further, even if the Court conc,'udes that a case is made out of grant of interim comperts:atiort, the Court will have to apply its mind to the quantu,n of interim compensation to be granted. Even at this :;tage, the Court will have to consider various factors such as the nature of transaction, the relationship, if any, ltetween the accused and the complainant and the paying c'apacity of the accuse:d. lf the defence of the accused is found to be prima facie a plausible defence, the Court m1'./ exercise discretion in refusing to grant interim contpen:;trtion. The Hon'ble Apex Court held that the above factttrs required to be considered are not exhaust and there could be several other factors in the facts of given case, such as, the pendency of a civil suit, etc., and categor,;cally held that while deciding the prayer made under SeL:t,'on 143-A, the Court must record brief reasons indicating consideration of all the relevant factors" .

13. ln the present case, the contents of the affidavit in the petition filed by the complainant under Section 143A of the I'll Act before the trial Court vide Crl.M.P.No.429 of 2023 itself reveais that he was a worker under the accused. He was looking aftr:r' the business * transactions of the accused which included ensuring the Compliance 4t I t I ! ! i I t I i i 9 of statutory requirements with PF, ESl, VAT, GAST, lncome Tax Departments and also collection of the payments from poultry Debtors as per the instructions of the accused and compiling information for Tenders etc., during the employment with the accused. lt is averred by the complainant that the accused used to take advances from the complainant to meet his urgent financial requirements, apart from irregular payment of his remuneration agreed by the accused and that out of his own resources and from the funds borrowed by him from his friends, relatives and acquaintances, he has extended an amount to an extent of Rs.85,00,541/- to the accused as on 23.12.2020. lt is further alleged that when he was facing financral problem on account of the negligible payment made by the accused and when the situation has reached an alarmrng stage that he was constrained to prevail over the accused for settlement of dues, owing to which the accused has issued a cheque.

14. Thus, complainant's own affidavit reveals that he was an employee under the accused and he was dealing with all the day to day {airs and financial transactions of the accused. The plea taken by the accused has to be considered in this regard that he has i denied the transaction. He has raised his defence, thus the trial t0 Courtoughttohaveexaminedallthesefactsor.recclrdbefore awarding any interim compensation. The matter is p'o51s6 for trial and at the time of adducrng evidence, the petitioner has come up with the preserlt Petition

15. The matter is pending for trial for the past fcur 4 years and after4yearsthecomplainanthaschosentofilethe;lresentpetition. This Court is unable to concur with the reasons assigned by the revisional Court and not satisfied with the orders par;s'ed by the trial Court, without there being any reasons.

16. ln view o1 the above held discussion and ir light of the guidelines laid down in Rakesh Ranian's case, it is held that the orders passed by the trial Court and confirmed by the revisional Court do not hold good in the facts and circumstarr'les of the case' therefore, the sarne are liable to be set aside.

17. ln the result, the Criminal Petition is allowerl and the order dated 0'l .04.2025 passed in Criminal Revision P':lition No 06 of 2024 by the learned Vlll Addilional District & SessiorLs Judge' Ranga Reddy District at L.B.Nagar, rs hereby set aside' l 1l r lViscellaneous applications pending, if any, shall stand closed. SDi- U.SUDHA ASSISTANTREGISTRAR //TRUE COPY// SECTION OFFICER To, 1 The Vlll Additional District and Sessions Judge, Ranga Reddy District, at L.B Nagar

2. The Judicial Magistrate of First Class, Special (ttilobile) PCR Act, Ranga Reddy Distnclcum-lV Addrtronal Metropolitan Magistrate-cum-lV Additional Junior Civil Judge. Ranga Reddy District. at L.B. Nagar 3 One CC to SRI P VINOD LAL Advocate [OPUC] 4. One CC to SRI S SOMESHWAR RAO Advocate [OPUC] 5 Two CCs to Public Prosecutor, High Court for the State of Telangana at Hyderabad IOUT] 6 Two CD Copies VM/PSL o HIGH COURT DATED: 1610912025 l ORDER CRLP.No.7352 of 2025 J, 1tt riL;i nn '*, a:\ '.i r,i i..r li-O I I I I J ! E I , i : I . 2 t I t I ALLOWING THE CRIMINAL PETITION