Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2025 Supreme(Online)(Bom) 248636

HIGH COURT OF BOMBAY
HON'BLE SHRI JUSTICE S. M. MODAK
SATBIR NARANG AND ANR – Appellant
Versus
SANJAY KISHIN SHAHANI AND ANR – Respondent
WP/6183/2024

Advocates:
For the Appellants/Petitioners: R.S. Vidyarthi, Mohit Turakhia, Tej Lapsiya, Sanjay Bhojwani, Naresh Parihar
For the Respondents: R.S. Vidyarthi, Mohit Turakhia, Tej Lapsiya, Saumen S. Vidyarthi, Sanjay Bhojwani, Naresh Parihar, N.B. Patil

The Appellate Court must exercise judicial discretion when ordering a 20% compensation deposit under the Negotiable Instruments Act. A waiver is permissible in exceptional cases, and the court is duty-bound to record specific reasons for granting or refusing such a waiver to ensure procedural fairness and meaningful judicial review.

Headnote:(A) Negotiable Instruments Act, 1881 - Section 138 - Section 148 - Power of Appellate Court to direct deposit of compensation - Appellate Court must exercise judicial discretion in deciding whether to impose the condition of 20% deposit - The provision for deposit is not absolute; waiver is permissible in exceptional, rare, and appropriate cases. (Paras 10, 11, 15, 16)

(B) Appellate Procedure - Duty to record reasons - Appellate Court is mandated to provide specific reasons when refusing or granting a waiver of the deposit condition - Failure to provide reasons for rejecting a plea for waiver renders the order unsustainable - The exercise of discretion must be supported by adequate reasoning to allow for judicial review. (Paras 24, 25, 26)

Facts of the case:
The accused were convicted for the offence of dishonour of cheques. During the pendency of appeals against the conviction, the Appellate Court directed the accused to deposit 20% of the compensation amount as per statutory provisions. The accused challenged these orders, seeking a waiver and arguing that the Appellate Court failed to consider their specific contentions for exemption while failing to provide any reasoning for the rejection of their plea.

Findings of Court:
The court held that the mandate to deposit compensation is not a mechanical requirement. The Appellate Court must consider submissions regarding exceptional circumstances that might warrant a waiver, and failure to provide a reasoned order when denying such a waiver constitutes a failure of judicial duty and prevents effective appellate review.

Issues: Whether the Appellate Court is obligated to record specific reasons for refusing a waiver of the 20% deposit condition under the relevant provisions of the statute and whether such an order requires a fresh determination when reasons are absent.

Ratio Decidendi: The appellate court possesses limited discretion to waive the deposit requirement in rare and appropriate cases. While the provision generally mandates a deposit, the court is duty-bound to adjudicate on pleas for waiver by recording detailed reasons. An order that fails to address the arguments of the parties and lacks specific reasoning for the denial of a waiver is legally unsustainable, necessitating a remand for a fresh decision.

Result: Appeals disposed of; impugned orders set aside, and matters remanded to the Appellate Court to hear the parties and pass reasoned orders regarding the deposit conditions.

2025:BHC-AS:36425

IN THE HIGH COURT OF JUDICATURE AT BOMBAY

CRIMINAL APPELLATE JURISDICTION

Criminal Writ Petition No. 517 of 2025

With

Criminal Writ Petition No.520 of 2025

With

Criminal Writ Petition No.519 of 2025

With

Criminal Writ Petition No.518 of 2025

Sanjay Kishin Shahani

R/at. Row House No.7,

Kailash Kutir, Tatya Tope Society,

Opp. Old Natraj Enclave,

Wanowrie, Pune 411040. … Petitioner.

V/s.

1. Satbir S. Narang

R/at. Flat No.505, Ground Floor,

Cycle Society, Quarter Gate,

Pune 411002.

2. Jagjit S. Narang,

R/at-Flat No.501, A Building,

Swastik Ganga, Sopan Baug,

Ghorpadi, Pune 411001. 3. State of Maharashtra

Notice to be served

Through Learned APP Writ Cell

High Court of Bombay … Respondents.

With Digitally signed by

LATA Criminal Writ Petition No. 6183 of 2024

LATA SUNIL

SUNIL PANJWANI With

PANJWANI Date:

2025.08.25

+0530

Criminal Writ Petition No. 6184 of 2024 With Criminal Writ Petition No.6185 of 2024 With Criminal Writ Petition No. 84 of 2025

1. Satbir S. Narang R/at. Flat No.505, Ground Floor, Cycle Society, Quarter Gate, Pune 411002.

2. Jagjit S. Narang, R/at-Flat No.501, A Building, Swastik Ganga, Sopan Baug, Ghorpadi, Pune 411001. … Petitioners.

V/s.

1. Sanjay Kishin Shahani R/at. Row House No.7, Kailash Kutir, Tatya Tope Society, Opp. Old Natraj Enclave, Wanowrie, Pune 411040.

2. State of Maharashtra. … Respondents.

Mr. R.S. Vidyarthi a/w. Mr. Advocate for the Petitioners in Mohit Turakhia, Mr. Tej Lapsiya WP 6183, 6184,6185 of 2024 i/b. Saumen S. Vidyarthi and 84/25.

Mr. Sanjay Bhojwani a/w. Mr. Advocate for the Petitioner in WP Naresh Parihar No.517, 518,519,520 of 2025 and for Respondent in WP 6183, 6184,6185 of 2024 and 84/25.

Mr. N.B. Patil APP for the State.

CORAM : S.M. MODAK, J DATE : 04th August 2025.

ORAL JUDGMENT :

As directed by this Court on 7th July 2025 both the accused have deposited Rs.5 lakhs before the trial Court i.e Court of JMFC, Cantonment Court. On this background, I have heard learned Advocate for the Complainant as well as learned Advocate for the Accused Nos.1 and 2.

2. The Complainant-Sanjay Shahani has filed 4 petitions thereby praying for enhancement of amount of compensation whereas both the accused being aggrieved by condition to deposit 20% of the compensation amount have approached this Court. There were four complaints for an offence punishable under Section 138 of the Negotiable Instrument Act (for short ‘N.I.Act’).

3. After trial both the accused were convicted for that offence by four separate judgments. The sentence is as follows:

(i) The substantive sentence of imprisonment for one month.

(ii) Twice the amount of the cheque by way of compensation. In every case the compensation amount is different.

4. All these judgments were challenged before the Appellate Court by way of four separate Criminal Appeals. During pendency, they applied for suspension of the sentence. By way of four separate orders dated 29^th November 2024, the Court of Additional Sessions Judge, Pune directed them to deposit 20% of the compensation amount within 60 days. As said above there is a challenge to this condition.

5. My attention is invited to the said order on Page 28 of the Writ Petition No.519/2025. The learned Appellate Court Judge has referred to following two judgments:

1. Surinder Singh Deswal alias Colonel S.S.Deswal nd others v/s. Virendra Gandhi1

2. Jamboo Bhandari vs. M.P. State Industrial development Corporation Limited and others2 While imposing the condition to deposit 20% of the compensation amount, the learned Appellate Court Judge held as follows:

“So far as the compensation as contemplated under section 148 of the N.I.Act is concerned, in the case law of ‘Surinder Singh Deswal’, cited supra, it is observed that, “the imposing of the payment of sum is mandatory.”

Further it is held:

1 (2019) 11 Supreme Court Cases 341 2 (2023) 10 Supreme Court Cases 446 “The case law of ‘Jamboo Bhandari’ cited supra, is not helpful to the appellant because, it is in respect of the exceptional case and no exceptional circumstances are shown by the

Click Here to Read the rest of this document

2025 Supreme(Online)(Bom) 248636

HIGH COURT OF BOMBAYHON'BLE SHRI JUSTICE S. M. MODAKSATBIR NARANG AND ANR – AppellantVersusSANJAY KISHIN SHAHANI AND ANR – RespondentWP/6183/2024

HIGH COURT OF BOMBAY
HON'BLE SHRI JUSTICE S. M. MODAK
SATBIR NARANG AND ANR – Appellant
Versus
SANJAY KISHIN SHAHANI AND ANR – Respondent
WP/6183/2024