Restoration of Section 138 NI Act Complaint Supreme Court Ruling

Case Summary

• Case name: Yatendra Singh v. State of U.P. & Another

• Date of judgment: 30 January 2026

• Judges: Honourable Justice B.V. Nagarathna; Honourable Justice Ujjal Bhuyan

• Advocates: Not mentioned in the reported order

• Act(s) and section(s): Negotiable Instruments Act, 1881 — Section 138

• Cited judgments: None recorded in the short published order

Introduction

This short but important judgment of the Supreme Court — delivered by Honourable Justice B.V. Nagarathna, with Honourable Justice Ujjal Bhuyan concurring — addresses the limited but significant question of restoration of a criminal complaint under Section 138 of the Negotiable Instruments Act which had been dismissed for default by the trial court and subsequently not restored by the High Court. The appeal turns not on novel points of statutory interpretation but on the application of well-established principles governing restoration of criminal proceedings and the exercise of the Court’s discretionary supervisory jurisdiction in the interests of justice.

Factual and procedural matrix

The complaint (Complaint Case No.1125/2022) under Section 138 NI Act was dismissed for default by the learned Presiding Officer, Additional Court No.2, Ghaziabad on 03 March 2023. A revision petition was taken to the High Court but, by order dated 24 September 2025, the High Court declined to restore the complaint. The appellant approached this Court by Special Leave Petition (Criminal) and obtained leave to appeal. The sole relief sought from the Supreme Court was restoration of the complaint.

Issue for determination

At the narrowest level the question was whether the High Court erred in declining to exercise its revisional jurisdiction to restore the complaint which had been dismissed for default by the trial court. The broader legal issue — implicitly engaged — is the scope and limit of appellate or revisional interference where a case has been dismissed for default, and the competing demands of finality, expedition and the interest of justice.

The Court’s reasoning and disposition

The Supreme Court, after hearing counsel and considering the material on record, concluded that the High Court ought to have interfered. The concise operative reasoning is captured in two passages quoted from the order: “All that the appellant is seeking in this appeal is for restoration of Complaint Case No.1125/2022…” and “we find that the High Court was not right in declining to interfere in the matter.” Consequently, both the High Court’s order dated 24.09.2025 and the trial court’s order dated 03.03.2023 were set aside and the complaint restored. The appeal was disposed accordingly.

Analysis of the Court’s approach

1. Restraint and the exercise of discretion: The Court’s short order is notable for its restrained exercise of supervisory jurisdiction. The Supreme Court did not embark upon rehearing the case on merits; rather it confined itself to the correctness of the refusal to restore and exercised its corrective power to set aside both the dismissal and the High Court’s order. This reflects an established judicial temperament: restoration is a discretionary remedy to be exercised sparingly but firmly when justice so requires.

2. Interest of justice as governing principle: The decisive language in the order — “bearing in mind the interest of justice” — underscores that restoration is not a procedural favour but a remedial measure designed to prevent injustice where dismissal has occurred on account of default that ought not to have resulted in final determination. For practitioners this emphasises that restoration applications must be framed and supported by material showing a credible explanation for default, and that the Court will weigh prejudice to parties and overall fairness.

3. High Court’s duty in exercise of revisional jurisdiction: The Supreme Court’s intervention evidences the duty of appellate and revisional courts to scrutinise orders of dismissal for default, particularly where recorded reasons or the material may show that the trial court failed to consider relevant circumstances or exercised its discretion improperly. The High Court’s refusal to restore was treated as susceptible to corrective review.

4. Practical takeaways for practitioners: For defence and prosecution alike, the decision is a reminder to attend diligently to procedural calendars and compliance with court directions. For complainants under Section 138 NI Act (which frequently proceeds as a summary trial with commercial urgency), an application for restoration should be supported by contemporaneous evidence explaining default. Conversely, respondents should press for strict compliance but be mindful that courts will not rigidly enforce dismissal where doing so would cause disproportionate prejudice.

Highlighted quotes

“All that the appellant is seeking in this appeal is for restoration of Complaint Case No.1125/2022…”

“we find that the High court was not right in declining to interfere in the matter.”

“This appeal is disposed of in the aforesaid terms. Pending application(s), if any, shall stand disposed of.”

Context and wider implications

Section 138 cases are a significant component of the criminal dockets in many trial courts. The statutory scheme contemplates prompt redressal of dishonoured cheques, and courts have long recognised the need to ensure that technical defaults do not trump substantive justice. While the order under review is succinct, its import lies in reinforcing that procedural dismissal is not an automatic bar to remedy — especially when higher courts, upon careful scrutiny, determine that restoration would serve justice.

For High Court judges and trial judges, the judgment reiterates the need for meticulous reasoning when dismissing criminal complaints for default, and for a sensitive application of discretion in restoration petitions. For litigators, the order is a practical prompt to prepare full and credible material for any restoration plea, including proof of service, reasons for non-appearance, steps taken to prosecute or defend the case, and absence of mala fide delay.

Operative Reasoning and Consequences

The operative portion of the Supreme Court’s order gives primacy to the appellate court’s oversight where the dismissal may have been precipitous or erroneous. The Court noted that the appeal sought only restoration and, on a review of the record and submissions, concluded that the High Court’s refusal to exercise its revisionary powers was incorrect. The two-stage relief (setting aside both the trial court’s dismissal order and the High Court’s order) is significant: it restores the status quo ante so that the complaint can proceed on the merits.

The Court’s determination appears to have rested upon the principle that restoration should be granted where (i) the default is explained satisfactorily or the explanation would justify indulgence, (ii) there is no inordinate delay occasioned by the party seeking restoration that would cause prejudice to the opposing party, and (iii) where the ends of justice demand continuation of the proceedings rather than final termination by reason of a technical lapse. Although the short order does not catalogue the specific facts relied upon to satisfy these criteria, its disposition is a practical illustration of the principle that the administration of criminal justice ought not to be defeated by avoidable procedural outcomes.

Two features of the Court’s approach merit emphasis for practitioners. First, a restoration plea that is successful before the Supreme Court will typically require a contemporaneous record or acceptable explanation for non-compliance: medical emergencies, non-service of notices, or credible administrative lapses are examples of mitigants courts have accepted in analogous contexts. Second, the Court’s restoration of the case without remitting further directions suggests confidence that trial courts can proceed expeditiously once the case is restored; practitioners should be ready to press for appropriate directions to avoid repeated adjournments.

Finally, although no earlier authorities were cited in the brief order, the ratio is congruent with the broader jurisprudential trend that vindicates substantive justice over undue procedural rigidity. The decision should therefore be read as salutary guidance to both trial courts and appellate benches: exercise of discretion to dismiss on technical grounds must be sparing, and revisional interference is available where non-interference would produce an unjust result. The immediate consequence is the restoration of Complaint Case No.1125/2022 to the file of the Additional Court No.2, Ghaziabad, but the wider lesson reverberates across criminal practice in Section 138 matters: procedure is a means to justice, not its usurper.

Conclusion

The Supreme Court’s concise order in Yatendra Singh emphasises that the interest of justice can, and sometimes must, prevail over procedural finality. For legal practitioners in India, the judgment is a prompt to ensure careful presentation of restoration applications and to be mindful that higher courts will scrutinise the propriety of dismissals for default. The Court’s restoration of the complaint reinforces the core principle that courts are guardians of justice, and procedural lapses where reasonably explained should not be allowed to extinguish substantive rights.