Jammu & Kashmir High Court – Srinagar Bench
Nargees Javaid vs Ghulam Jeelani Nengroo on 20 April, 2026
S.No.213
Supp. Case List
IN THE HIGH COURT OF JAMMU & KASHMIR AND LADAKH
AT SRINAGAR
CRM(M) 185/2026 CrlM(451/2026)
Reserved On: 15.04.2026
Pronounced On: 20.04.2026
Uploaded On: 21.04.2026
Whether the Operative part or
full judgment is pronounced: Full
Nargees Javaid,Aged 40 years ...Petitioner
W/o Bilal Ahmad Bakshi
R/o Bellow Dargund
Tehsil Rajpora District Pulwama
Through: Mr. Mudasir bin Hassan, Advocate
Vs.
Ghulam Jeelani Nengroo ...Respondent
S/o Mohammad Anwar Nengroo
R/o Prichoo, Tehsil and District
Pulwama
Through:
CORAM:HON'BLE MR. JUSTICE WASIM SADIQ NARGAL, JUDGE
JUDGEMENT
20.04.2026
BRIEF FACTS:
1. The petitioner has invoked the jurisdiction of this Court under Section 528 of
the Bharatiya Nagarik Suraksha Sanhita, calling in question the order dated
16.03.2026 passed by the Court of Learned Special Mobile Magistrate,
Pulwama, whereby an application filed by the respondent under Section 143-
A of the Negotiable Instruments Act, 1881 has been allowed.
2. Briefly stated, the respondent had instituted a complaint against the
petitioner under Sections 138 and 142 of the Negotiable Instruments Act,
alleging dishonor of several cheques purportedly issued by the petitioner in
discharge of a legally enforceable liability.
CRM(M) 185/2026 1 | Page
3. The cheques, as detailed in the complaint, include cheque Nos. 209524
(₹5,00,000/-), 209525 (₹5,00,000/-), 209526 (₹3,00,000/-), 209527
(₹4,00,000/-), 209528 (₹8,00,000/-), 209529 (₹5,00,000/-), 209530
(₹5,00,000/-), 209531 (₹6,00,000/-), 209532 (₹3,00,000/-), 209536
(₹5,00,000/-) and 209540 (₹6,00,000/-, all stated to have been issued in
favour of the respondent.
4. Upon presentation, the cheques were dishonored, thereafter the complaint
came to be filed before the trial Court. The petitioner, upon being summoned,
appeared before the trial Court and the substance of accusation was put to
her in terms of Section 251 of the Code of Criminal Procedure (now Section
274 of the Bharatiya Nagarik Suraksha Sanhita). The petitioner, at that stage,
categorically denied the issuance of the cheques and specifically pleaded that
she is not a signatory thereto.
5. During the pendency of the proceedings, the respondent filed an application
under Section 143-A of the Negotiable Instruments Act seeking interim
compensation.
6. The Learned Special Mobile Magistrate, Pulwama, however, vide order
dated 16.03.2026, allowed the application and directed payment of 10% of
cheque amount as interim compensation.
7. Aggrieved thereof, the petitioner has filed the present petition, primarily on
the ground that the impugned order reflects non-application of mind,
inasmuch as the trial Court has failed to consider the specific defence raised
by the petitioner regarding denial of signatures and the request for forensic
examination, and has proceeded to pass the order in a routine manner
without appreciating the scope and object of Section 143-A of the Negotiable
Instruments Act.
CRM(M) 185/2026 2 | Page
SUBMISSIONS ON BEHALF OF PETITIONER
8. Learned counsel on behalf of petitioner submits that the order passed by the
Learned Special Mobile Magistrate, Pulwama, has failed to consider the
relevant material on record and has ignored the settled legal position
governing the field. The power under Section 143-A of the Negotiable
Instruments Act is discretionary in nature and is required to be exercised
judiciously on a case-to-case basis. The object of the provision is to address
delay in disposal of cheque dishonour cases, and not to mechanically grant
interim compensation. The impugned order, having been passed in an
arbitrary and mechanical manner, is liable to be set aside.
9. It is further submitted that there has been a noticeable rise in frivolous and
vexatious complaints filed with ulterior motives to harass the accused. In
such circumstances, directing payment of interim compensation at a
premature stage causes serious prejudice to the accused. In the event of
acquittal, the accused faces substantial difficulty in recovering the amount so
paid, as the Negotiable Instruments Act does not provide an effective
mechanism for restitution. Though Section 143-A(4) contemplates
repayment, the mode of recovery under Section 421 CrPC (now Section 462
BNSS) is cumbersome and often ineffective, particularly where the
complainant lacks sufficient means. On this ground also, the impugned order
deserves to be quashed.
10. It is submitted that although Section 139 of the Negotiable Instruments Act
raises a presumption in favour of the holder of the cheque, the same is
rebuttable. Where the very execution of the cheque is denied, as in the
present case, the burden shifts upon the complainant to establish the
genuineness of the signatures. The Learned Trial Court has failed to
CRM(M) 185/2026 3 | Page
appreciate this crucial aspect and has proceeded to grant interim
compensation without proper enquiry.
11.It is further submitted that the power to grant interim compensation is not
mandatory but discretionary, to be exercised sparingly and upon due
consideration of the facts and circumstances of each case. The Learned Trial
Court has misappreciated the facts and evidence on record and has failed to
record any cogent reasons justifying the grant of interim compensation. The
absence of reasons vitiates the impugned order and renders the same liable to
be set aside.
12.It is submitted that the petitioner has at no point attempted to delay the
proceedings or evade the process of law. On the contrary, the petitioner has
cooperated with the trial proceedings in a bona fide manner. The petitioner
has categorically denied issuance of the cheques in her statement recorded
under Section 251 CrPC (now Section 274 BNSS), thereby raising a
plausible and legally tenable defense. In such circumstances, the Learned
Trial Court ought to have exercised restraint in granting interim
compensation. The impugned order, therefore, is liable to be quashed.
13.It is finally submitted that the impugned order is devoid of reasons,
particularly with regard to the quantum of interim compensation awarded at
the rate of 10% of the cheque amount. The Learned Trial Court has failed to
indicate any basis for determining such quantum. In the absence of any such
reasoning the counsel argues that the impugned order is rendered
unsustainable in law
LEGAL ANALYSIS:
14.Heard and considered.
CRM(M) 185/2026 4 | Page
15.For a proper appreciation of the submissions advanced by learned counsel, it
is essential to meticulously examine the scope and import of Section 143A of
the Negotiable Instruments Act, 1881. For the sake of convenience and ready
reference, the statutory provision is reproduced as under:
“143A. Power to direct interim compensation.–(1) Notwithstanding
anything contained in the Code of Criminal Procedure, 1973, the Court
trying an offence under section 138 may order the drawer of the
cheque to pay interim compensation to the complainant– (a) in a
summary trial or a summons case, where he pleads not guilty to the
accusation made in the complaint; and
(b) in any other case, upon framing of charge.
(2) The interim compensation under sub-section (1) shall not exceed
twenty per cent. of the amount of the cheque.
(3) The interim compensation shall be paid within sixty days from the
date of the order under subsection (1), or within such further period
not exceeding thirty days as may be directed by the Court on sufficient
cause being shown by the drawer of the cheque.
(4) If the drawer of the cheque is acquitted, the Court shall direct the
complainant to repay to the drawer the amount of interim
compensation, with interest at the bank rate as published by the
Reserve Bank of India, prevalent at the beginning of the relevant
financial year, within sixty days from the date of the order, or within
such further period not exceeding thirty days as may be directed by
the Court on sufficient cause being shown by the complainant.
(5) The interim compensation payable under this section may be
recovered as if it were a fine under section 421 of the Code of
Criminal Procedure, 1973 (2 of 1974).
(6) The amount of fine imposed under section 138 or the amount of
compensation awarded under section 357 of the Code of Criminal
Procedure, 1973 (2 of 1974), shall be reduced by the amount paid or
recovered as interim compensation under this section.”
16.A plain reading of Section 143A of the Negotiable Instruments Act, 1881
makes it clear that the legislature has empowered the Court trying an offence
under Section 138 of the Negotiable Instruments Act to award interim
compensation to the complainant at a preliminary stage of the proceedings.
CRM(M) 185/2026 5 | Page
Such power can be exercised in a summary trial or summons case when the
accused pleads not guilty, and in any other case upon the framing of charge.
The provision thus contemplates grant of compensation even before the
conclusion of trial, with a view to address delay and provide immediate relief.
17. It is further evident that the use of the expression “may” in sub-section (1)
confers a discretionary power upon the Court, meaning thereby that the grant
of interim compensation is not automatic or mandatory in every case. The
Court is required to exercise such discretion judiciously, upon consideration
of the facts and circumstances of each case, and not in a mechanical manner.
18.A holistic reading of Section 143A demonstrates that while the provision is
intended to afford interim relief to the complainant, it equally incorporates
safeguards to prevent undue prejudice to the accused, and vests a controlled
discretion in the Court to be exercised on sound judicial principles.
19.Coming to the impugned order, it is evident that the learned Special Mobile
Magistrate, Pulwama has failed to record any cogent reasons while allowing
the application. The scheme of Section 143A of the Negotiable Instruments
Act, 1881 mandates that before directing payment of interim compensation,
the Court must prima facie evaluate the case set up by the complainant as
well as the defense raised by the accused in response to the application.
20.A direction to pay interim compensation cannot be issued in a routine or
mechanical manner; it must be founded upon a prima facie satisfaction that
the complainant has made out a case warranting such relief. In the present
case, however, the learned Magistrate has neither undertaken any such
evaluation nor assigned reasons as to why interim compensation to the extent
of 10% of the cheque amount has been granted.
21.A perusal of the impugned order reveals that the learned Magistrate has
made a cursory reference to the statutory provision, observing that the Court
CRM(M) 185/2026 6 | Page
is empowered to grant interim compensation up to 20% of the cheque
amount upon recording the plea of not guilty. However, the order is
conspicuously silent with regard to any application of mind to the facts of the
case, and does not disclose the basis on which interim compensation to the
extent of 10% has been quantified.
22.The reasoning assigned in the impugned order merely reiterates the statutory
position concerning the presumption and the stage at which such power may
be exercised, but falls short of reflecting any independent judicial assessment.
Such an approach vitiates the impugned order and renders it unsustainable in
law.
23.The impugned order is in the teeth of the settled position of law as laid down
by the Hon’ble Supreme Court in Rakesh Ranjan Shrivastava v. State of
Jharkhand reported as (2024) 4 SCC 419, in which the Hon’ble Supreme
Court has held as under:
“a. The exercise of power under sub-section (1) of Section 143A is
discretionary. The provision is directory and not mandatory. The word
“may” used in the provision cannot be construed as “shall.”
b. While deciding the prayer made under Section 143A, the Court
must record brief reasons indicating consideration of all relevant
factors.
c. The broad parameters for exercising the discretion under Section
143A are as follows:
i. The Court will have to prima facie evaluate the merits of the case
made out by the complainant and the merits of the defence pleaded by
the accused in the reply to the application. The financial distress of
the accused can also be a consideration.
ii. A direction to pay interim compensation can be issued, only if the
complainant makes out a prima facie case.
iii. If the defence of the accused is found to be prima facie plausible,
the Court may exercise discretion in refusing to grant interim
compensation.
iv. If the Court concludes that a case is made out to grant interim
compensation, it will also have to apply its mind to the quantum ofCRM(M) 185/2026 7 | Page
interim compensation to be granted. While doing so, the Court will
have to consider several factors such as the nature of the transaction,
the relationship, if any, between the accused and the complainant, etc.
v. There could be several other relevant factors in the peculiar facts of
a given case, which cannot be exhaustively stated. The parameters
stated above are not exhaustive.”
24. A plane reading of the judgement supra makes it clear that while
adjudicating an application under Section 143A of the Negotiable
Instruments Act, 1881, the Magistrate is required to record reasons while
directing payment of interim compensation. It has been clarified by the
Hon’ble Apex Court that the power under the said provision is discretionary
in nature and cannot be exercised in a routine or mechanical manner.
25.However, in the instant case in clear departure from the settled position of
law, the learned Magistrate has neither recorded any reasons nor reflected
due application of mind to the facts and circumstances of the case, as
mandated under Section 143A of the Negotiable Instruments Act, 1881. The
impugned order is completely silent on any prima facie evaluation of the
case prior to directing the payment of interim compensation.
26.The impugned order is further vitiated on account of absence of cogent
reasons, inasmuch as it fails to indicate any basis for awarding 10% of the
cheque amount as interim compensation. A plain reading of Section 143A of
the Negotiable Instruments Act, 1881 makes it evident that the quantum of
interim compensation is not fixed and may extend up to 20% of the cheque
amount. This necessarily entails that the Court is required to exercise its
discretion judiciously, having regard to the facts and circumstances of each
case. Where the statute permits a range from 1 up to 20%, the determination
of any particular figure, such as 10%, must be supported by clear and
CRM(M) 185/2026 8 | Page
reasoned justification. In the absence of such reasoning, the impugned order
cannot be sustained in law.
27.This Court in CRM(M) No. 50/2020 titled as Nazir Ahmad Chopan vs
Abdul Rehman Chopan, decided on 23.12.2022, has held as under:
“Although no guidelines for grant of interim compensation have been
laid down in Section 143-A of the NI Act, yet it is a settled law that
whenever a discretionary power is to be exercised by a Court, the same
has to be exercised on well-recognized principles supported by reasons.
The Court has to spell out the reasons for grant of interim compensation
in favour of the complainant and it has also to justify in its order with
reasons the quantum of interim compensation that is being awarded by it,
as the said quantum can vary from 1% to 20% of the cheque amount.”
28.In the judgement supra this Court has held that the discretionary power under
Section 143A must be exercised on well-recognized principles and duly
supported by reasons and Court has to spell out the reasons for grant of
interim compensation in favour of the complainant and it has also to justify
in its order with reasons the quantum of interim compensation that is being
awarded by it, as the said quantum can vary from 1% to 20% of the cheque
amount.
CONCLUSION
29.In view of the foregoing discussion, the impugned order dated 16.03.2026
passed by the learned Special Mobile Magistrate, Pulwama is hereby
quashed with a direction to learned Special Mobile Magistrate, Pulwama to
pass a fresh order expeditiously in the light of observations made
hereinabove and, in the event of being inclined to grant interim
compensation, shall record reasons indicating consideration to all relevant
factors.
CRM(M) 185/2026 9 | Page
30.It is, however, made clear that the observations recorded herein are confined
to the disposal of the present petition and shall not be construed as an
expression of opinion on the merits of the case.
31.Both the parties are directed to appear before the learned Special Mobile
Magistrate, Pulwama on 27th April, 2026.
(WASIM SADIQ NARGAL)
JUDGE
SRINAGAR:
20-04-2026
Mubashir
i. Whether the order is reportable: Yes
Whether the order is speaking: YesCRM(M) 185/2026 10 | P a g e