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2025 Supreme(All) 2971

IN THE HIGH COURT OF ALLAHABAD, LUCKNOW BENCH
Rajnish Kumar, J.
Dhanu Krishi Sewa Kendra Thru. Its Proprietor Vishal Sharma And Another - Appellant
Versus
State Of U.P. Thru. Prin. Secy. Home Lko. And Another - Respondent
APPLICATION U/s 482 No. - 5317 of 2025
Decided On : 03-07-2025

Advocates:
Advocate Appeared:
For the Appellant : Shantanu Mishra and Mohd Kaif Khan
For the Respondent: G.A.

Interim compensation under Section 143A of the NI Act can be granted before trial; the presumption of validity remains even if not all amounts are covered by the cheque.

Headnote:(A) Negotiable Instruments Act - Sections 138, 139, and 143A - Application for interim compensation - Presumption of liability for dishonored cheques - Court found that interim compensation may be awarded even before trial - Court dismissed application challenging interim compensation, finding no error in the lower courts' orders. (Paras 3, 7, 19)

Facts of the case:
Applicants contested an order for interim compensation of 15% based on cheques for loans provided to the respondent, claiming invalidity due to alleged loss of cheques and lack of proof for cash repayment. (Paras 4, 6, 10)

Findings of Court:
Court upheld interim compensation ruling, clarifying that the presumption in favor of the holder of a cheque applies even for part-payments. (Paras 8, 14)

Issues: Court addressed the validity of interim compensation under Section 143A and the handling of the application before evidence was recorded. (Para 6)

Ratio Decidendi: The Court concluded that interim compensation is permissible pre-trial and clarified the discretionary nature of such orders under Section 143A, emphasizing upon consideration of merits and the conduct of the parties. (Paras 12, 19)

Result: Application dismissed.

Table of Content
1. application assesses validity of interim compensation claims. (Para 1)
2. application under section 482 crpc (Para 2)
3. dispute over interim compensation allowance (Para 3 , 4)
4. court's analysis of allegations and evidence (Para 5 , 8 , 9 , 10)
5. court's evaluation of cheque presumption (Para 6 , 11 , 12)
6. discretion of court in awarding interim compensation (Para 7 , 13)
7. final decision on application dismissal (Para 14 , 15 , 16)

JUDGMENT :

Rajnish Kumar, J.

1. Heard Shri Shantanu Mishra, learned counsel for the applicants and Shri Anurag Verma, learned Additional Government Advocate.

2. This application under Section 482 CrPC (now Section 528 BNSS , 2023) has been filed assailing the order dated 15.05.2025 passed in Case No. 111255 of 2023; Raj Kishore Sharma vs. Dhanu Krishi Sewa Kendra and another by the Additional Court No. 9 (NI Act), Lucknow and order dated 28.05.2025 passed in Criminal Revision No. 282 of 2025; Dhanu Krishi Sewa Kendra vs. Raj Kishore Sharma and others by the Session Judge, Lucknow.

3. Learned counsel for the applicants submits that the application filed under Section 143A of Negotiable Instruments Act (here-in-after referred as NI Act) for interim compensation by the respondent no. 2 has wrongly and illegally been allowed by the concerned court. He further submits that the presumption for payment of interim compensation could not have been drawn at this stage and it can be drawn only at the stage of trial after considering evidence. He further submits that the cheques- in-question were lost, therefore, a Lost Article Report (LAR) was lodged with the bank, on account of which, the stop payment was made and the cheques were returned on account of stop payment and not on account of insufficiency of funds. He further submits that the payment in cash has been said to have been made to the respondent no.2, whereas no proof thereof has been placed on record. He further submits that the total amount paid has been shown as Rs. 12,50,000/-, whereas the cheques-in-question are of Rs. 2,50,000 and Rs. 6,00,000/- i.e. total of Rs. 8,50,000/-. He further submits that being aggrieved by the order passed by the trial court, the applicants had filed a revision, which has also been dismissed without considering the grounds raised by the applicants. He relies on the judgment and order dated 15.03.2024 passed in Rakesh Ranjan Shrivastava vs. The State of Jharkhand and another ; Criminal Appeal No. 741 of 2024 by the Hon'ble Supreme Court.

4. Per contra, learned AGA submits that the impugned order has rightly been passed in accordance with law after considering the pleadings of the parties. He further submits that the interim compensation under Section 143A of NI Act can be awarded even at the threshold. Even otherwise the trial has commenced. He further submits that the presumption as to negotiable instruments can be drawn under Section 118 of NI Act and it can be even in regard to the part payment as per Section 139 of NI Act. He also submits that information was given to the police on 06.03.2023 and the intimation to the bank is undated, whereas the cheques-in-question are of 03.02.2023 i.e. prior to the date of alleged loss and the signatures on cheques have also been admitted by the applicants. He further submits that the conduct of the applicants has also been considered not only by the trial court but by the revisional court also, according to which, immediately after grant of bail by the concerned court, the applicant absconded and after recall of the order, again he absconded, therefore, non bailable warrant was issued. Thus, the submission is that the impugned order does not suffer from any illegality or infirmity, which may call for any interference by this Court. This application has been filed on misconceived and baseless grounds. It is liable to be dismissed.

5. Having considered the submissions of learned counsel for the parties, I have perused the records.

6. The complaint under Section 138

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