Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2025 Supreme(Del) 373

IN THE HIGH COURT OF DELHI AT NEW DELHI
AJAY DIGPAUL, J.
Ihome And Infrastructure Pvt. Ltd. and Others - Appellants
Versus
The State Govt. of NCT of Delhi and Another - Respondents
Crl. Rev. Pet. (NI) Nos. 149, 156, 157, 158, 159, 160 of 2025, Crl. M.A. Nos. 20422, 20423, 21106, 21107, 21112, 21113, 21114, 21115, 21116, 21117, 21163, 21164 of 2025
Decided On : 09-09-2025

Advocates:
Advocate Appeared:
For the Appellants : Mohit Mathur, H.S. Kohli, D.S. Kohli, Yash Kadyan, Mannat Kohli
For the Respondents: Satish Kumar, Gautam Narayan, Kaustubh Prakash, Ravi Prakash

The appellate court can waive the deposit under Section 148 of the NI Act when it finds the trial court's orders manifestly flawed, allowing for meritorious appeals.

Headnote:(A) Bharatiya Nagarik Suraksha Sanhita, 2023 - Section 442; Code of Criminal Procedure, 1973 - Section 389; Negotiable Instruments Act - Section 138 and Section 148 - Appellants filed revision petitions against orders requiring deposit under Section 148 as condition for suspension of conviction. The court emphasized that the interpretation of 'may' in Section 148 should allow for discretion to waive the deposit under exceptional circumstances, based on the prima facie merit of the case. (Paras 34-48)

(B) The court reiterated that a deposit under Section 148 is ordinarily required, but exceptions can exist where an order is 'wholly incorrect', thereby calling for a more thorough examination of trial court records. (Paras 43-44)

Facts of the case:
Respondents invested in a project, issued postdated cheques as security, and sought enforcement under Section 138, contesting the enforceability of liability. Appellants contended that cheques were never intended for encashment, but as security.

Findings of Court:
No error in learned ASJ's determination that the Trial Court orders are not manifestly flawed, requiring deposit under Section 148 to proceed with appeal.

Issues: Appellate court's power under Section 148; maintainability of revisions against deposit orders; interpretation of liability.

Ratio Decidendi: Appellate courts may exercise discretion under Section 148 to waive deposits if convinced there's a strong likelihood of trial errors.

Result: Revision petitions dismissed; deposit required.

Table of Content
1. revision petitions under section 442 bnss initiated. (Para 1 , 2)
2. dispute regarding nature of cheques: security vs liability. (Para 3 , 4)
3. asj's interpretation of suppression of legal principles by trial court. (Para 5 , 6 , 7 , 8)
4. focus on prima facie nature of review for deposit orders. (Para 9 , 30)
5. importance of clauses in buy-back agreement with pdcs. (Para 10 , 11 , 12 , 14 , 15 , 16 , 17)
6. financial hardship arguments need substantiation. (Para 18 , 19)
7. co-accused directors not liable if non-signatories. (Para 20 , 21 , 22)
8. maintaining the need for deposit under section 148. (Para 23 , 24 , 25)
9. counter arguments against interpretations of maintainability. (Para 26 , 27 , 28)
10. paragraph challenge to maintainability not barred. (Para 29)
11. interpretation of orders under section 148 in revision context. (Para 34 , 35 , 36 , 37)
12. section 148 orders subject to judicial discretion. (Para 40)
13. judicial exercise of discretion in requiring deposits. (Para 43 , 44 , 49)
14. concluding dismissal of revision petitions. (Para 50 , 51)

JUDGMENT :

AJAY DIGPAUL, J.

1. The present revision petitions have been instituted under Section 442 read with Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023, assailing impugned order dated 24.05.2025 passed by the learned ASJ, Saket Courts, in connection with cases bearing C.A. nos.75-80/2025, whereby a direction was issued to the petitioner to deposit a sum equal to 20% of the fine amount awarded in favour of the respondent by the learned Metropolitan Magistrate vide judgments of conviction and sentencing dated 16.12.2024 and 28.01.2025, respectively. Subject to the making of such deposit within 60 days, the operation of the learned Trial Court’s order of conviction was stayed, and the petitioner’s sentence was suspended - as contemplated within Section 389 of the Code of Criminal procedure, 1973 [“Cr.P.C.” hereinafter]

The Impugned Order

2. The respondent had invested in a real estate project and had subsequently entered into a buy-back agreement with the petitioner to the extent of 22 flats for a consideration of Rs. 3,78,76,866/- (of which a sum of Rs. 18,76,866/- was paid upfront). Per this agreement, 9 postdated cheques [“PDCs” hereinafter] of Rs. 40,00,000/- each were issued to the respondent by the petitioner, whereby it was agreed between parties that each cheque was to be returned to the petitioner along with the title deeds to two flats upon actual payment of said amount.

3. The petitioner’s main contention was recorded as being that these cheques were issued as a security, and not for the discharge of any debt or liability, and they were not meant to be presented. Per contra, the respondent contended that these cheques signified a legally enforceable liability against the petitioner.

4. The petitioners contended before the learned ASJ that:

a. No legally enforceable debt/liability was made out before the learned Trial Court.

b. Their written arguments were not duly considered by the learned Trial Court.

c. The learned Trial Court’s judgment ran contrary to settled principles of law concerning liability/debt under Section 138 of the Negotiable Instruments Act.

d. They may be exempted from making a deposit under Section 148 of the NI Act, in light of the Hon’ble Supreme Court’s decision in Jamboo Bhandari v. Madhya Pradesh State Industrial Development Corporation Ltd. (2023) 10 SCC 446 .

5. The learned ASJ, after recording the submissions of the petitioners and rebuttal thereagainst by the respondents, discussed the settled position of law as laid down by the Hon’ble Supreme Court; from Surender Singh Deswal @ Col. S.S. Deswal v. Virender Gandhi , (2019) 11 SCC 341 to Jamboo Bhandari (supra) and Muskan Enterprises v. State of Punjab , 2024 INSC 1046 .

6. In this discussion, it was noted that both Surender Singh Deswal and Jamboo Bhandari were further discussed and interpreted in Muskan Enterprises, and that Muskan Enterprises is currently the prevaili