Complainant in Section 138 NI Act proceedings is a victim entitled to appeal acquittal before the Sessions Court.

The Appellant (original complainant) filed a criminal appeal under Section 378 of the CrPC/Section 419 of the BNSS challenging the judgment and order dated April 8, 2021, passed by the Chief Judicial Magistrate, Jamkhambhaliya.

The Trial Court had acquitted the respondent-accused of the offense punishable under Section 138 of the Negotiable Instruments Act (NI Act).

During the pendency of this appeal before the High Court, the respondents argued that the matter should be transferred to the Sessions Court based on recent legal developments regarding the forum for appeals by complainants in NI Act cases.

The Court primarily applied the proviso to Section 372 of the Criminal Procedure Code, 1973 (and its equivalent Section 413 of the Bharatiya Nagrik Suraksha Sanhita, 2023), which grants a 'victim' the right to prefer an appeal against an order of acquittal.

The Court relied heavily on the precedent set by the Hon’ble Supreme Court in Celestium Financial v. A. Gnanasekaran (2025 (3) GLH 747), which held that a complainant in a Section 138 NI Act proceeding is indeed a "victim" and possesses an absolute right to appeal to the Court immediately superior in hierarchy (the Sessions Court) without seeking special leave under Section 378(4).

The Court also noted the pending reference to a larger bench in Special Leave to Appeal (Crl.) No. 12350/2024 regarding the far-reaching consequences of this classification.

The High Court observed that according to the Celestium Financial ruling, there is no distinction between a victim of a general penal offense and a victim of a "deemed offense" under Section 138 of the NI Act.

Since the complainant is the party who suffered the financial impact of the dishonored cheque, they fall within the definition of "victim" under Section 2(wa) of the CrPC.

The Court reasoned that forcing a victim to seek "special leave" under Section 378(4) would contradict the Parliament's intent in inserting the proviso to Section 372.

Consequently, because the Sessions Court is the immediate superior court to the Magistrate, the appeal against acquittal must be heard there as a matter of right rather than being entertained by the High Court under Section 378.

The Court held that the appeal shall be treated and numbered as an appeal under the proviso to Section 372 of the CrPC (or Section 413 of BNSS).

The lower Appellate Court was directed to dispose of the matter expeditiously, subject to the final outcome of the reference currently pending before the Supreme Court.