Gujarat High Court Rules Acquittal Appeals Under Section 138 NI Act Must Be Filed in Sessions Court - 2026-03-24

Jurisdiction Shift: Gujarat High Court Redirects NI Act Appeals to Sessions Courts

In a significant order clarifying the appellate path for cheque bounce cases, the High Court of Gujarat has ruled that appeals against acquittals under Section 138 of the Negotiable Instruments (NI) Act must be entertained by the Sessions Court rather than the High Court. The decision, delivered by the bench of Hon'ble Mr. Justice Sanjeev J. Thaker, reinforces the statutory rights of victims in financial disputes.

Background of the Dispute

The matter originated from an appeal filed by Reliance Industries Ltd challenging a trial court’s decision to acquit the respondents in a case brought under Section 138 of the NI Act. As the legal landscape shifts with the implementation of new criminal codes, the procedural question of which forum holds original appellate jurisdiction in such matters became central to the litigation.

The Legal Crossroads

The primary question before the court was whether the High Court is the appropriate venue for an appeal preferred by a complainant—categorized as a 'victim'—following an acquittal. While the appellant sought recourse before the High Court, the court examined current procedural protocols necessitated by the shift toward the Bharatiya Nagrik Suraksha Sanhita (BNSS), 2023, and the existing Code of Criminal Procedure (CrPC).

Legal Analysis and Precedents

Justice Thaker relied heavily on the precedent established in Shivsinh Ganpatsinh Solanki v. State of Gujarat & Anr. (decided December 2025). That ruling integrated the Supreme Court’s direction in M/s Celestium Financial v. A. Gyanasekaran (2025 INSC 804).

The court’s reasoning rests on the definition of the complainant as a "victim." Under the proviso to Section 372 of the CrPC (and the corresponding Section 413 of the BNSS), a victim is entitled to appeal against an acquittal to the court immediately superior in the judicial hierarchy—the Sessions Court. By directing the transfer, the High Court ensured that the institutional hierarchy remains consistent with the legislative intent to provide victims with accessible appellate remedies.

Key Observations

The judgment underscores the importance of procedural compliance in the appellate process:

• "The Complainant, in a complaint under Section 138 of the N.I. Act, being a Victim, has a specific right to appeal under proviso of Section 372 of the Code / Section 413 of the BNSS to the Court which is immediately superior in hierarchy i.e., the Sessions Court."
• "The applications for leave to appeal/appeal(s) which are pending before this Court can be disposed of with a direction to transfer the said application/appeal(s) to the concerned Sessions Court."
• "Considering that the matter has been pending for considerable time, the learned lower Appellate Court is required to make endeavour to dispose of the matter as expeditiously as possible."

The Final Order

Exercising its directive power, the High Court ordered the Registry to transfer the entire case file, including the impugned orders and records, to the appropriate Sessions Court. The lower appellate body is now tasked with re-registering the appeal under the relevant provisions of the CrPC or BNSS. This ruling serves as a vital signal for practitioners across the state to streamline how they approach the appellate stage in cheque disbursement litigation, ensuring that future filings are directed to the appropriate Sessions forum immediately.

The Court explicitly noted that it did not venture into the merits of the underlying dispute, leaving the evaluation of the facts to the Sessions Court upon transfer.