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Can a cheque bounce complaint withdrawn by mistake be restored through a writ petition? The Rajasthan High Court, in its judgment dated 27 October 2026, examined this issue after a financial institution alleged that several cheque dishonour complaints had mistakenly been withdrawn during a National Lok Adalat.

Justice Anand Sharma held that withdrawal of the complaints resulted in the acquittal of the accused under Section 280 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS). The High Court dismissed 39 writ petitions as not maintainable because the complainant had an available statutory remedy under the BNSS.

Case Details – Ugro Capital Ltd. v. Khaderam Yadav

Background of the Cheque Bounce Cases

Ugro Capital Ltd., a financial institution, had filed several complaints under Section 138 of the Negotiable Instruments Act, 1881, against borrowers following the dishonour of cheques issued in connection with loans.

The trial court had taken cognizance of the complaints.

On 9 May 2026, a National Lok Adalat was organised before the trial court. According to the petitioner, numerous other complaints had been settled and the corresponding amounts recovered.

Consequently, the institution prepared lists of complaints proposed to be withdrawn.

However, the petitioner alleged that certain complaint numbers were accidentally included in the withdrawal lists due to a clerical mistake, even though no compromise had been entered into and no dues had been recovered in those cases.

Based on the applications submitted, the National Lok Adalat permitted the withdrawal of the complaints.

The finance company subsequently approached the Rajasthan High Court seeking to quash the withdrawal orders dated 9 May 2026 and restore the complaints.

Legal Issue Before the Rajasthan High Court

The principal legal issue was whether the complainant could directly invoke the writ jurisdiction of the High Court under Articles 226 and 227 to challenge the withdrawal orders when those orders had resulted in the acquittal of the accused.

The Court examined the legal consequences of withdrawal under Section 280 BNSS.

Section 280 BNSS – Withdrawal of Complaint

Section 280 of the Bharatiya Nagarik Suraksha Sanhita, 2023, provides a mechanism for withdrawal of a complaint in a summons-case trial before the Magistrate passes a final order.

Where the complainant satisfies the Magistrate that sufficient grounds exist for withdrawal, the Magistrate may permit the complaint to be withdrawn.

The statutory consequence is that the Magistrate shall acquit the accused against whom the complaint is withdrawn.

Thus, withdrawal under Section 280 BNSS is not merely an administrative closure of the criminal complaint. It has the legal effect of acquittal.

Key Findings of the Rajasthan High Court

1. Withdrawal of Complaint Results in Acquittal

The High Court observed that once the complaints were withdrawn pursuant to the orders dated 9 May 2026, the accused persons acquired the status of acquitted persons under Section 280 BNSS.

The Court treated acquittal as the legal consequence of the withdrawal orders.

2. Statutory Remedy Under BNSS Must Be Considered

The financial institution sought relief through writ petitions under Articles 226 and 227 of the Constitution of India.

However, the High Court held that the petitioner had an available remedy under the BNSS against the acquittal orders.

The petitioner had not demonstrated a justified reason for bypassing the statutory remedy and directly approaching the High Court.

Accordingly, the writ petitions were held to be not maintainable.

3. Alleged Clerical Error Was Not Decided on Merits

The financial institution maintained that the withdrawal applications had been filed because of a genuine clerical error.

The High Court expressly declined to comment on the merits of this allegation.

The Court stated that the explanation for the allegedly erroneous withdrawal could be examined by the competent court exercising the available jurisdiction against the acquittal.

4. Alternative Remedy Was Expressly Preserved

While dismissing the writ petitions, the High Court clarified that dismissal would not curtail the petitioner's right to avail itself of the alternative remedy available under the BNSS.

Therefore, the judgment should not be interpreted as a final rejection of the institution's allegation of mistake or its underlying loan claims.

Practical Legal Implications for Section 138 NI Act Cases

For Complainants and Financial Institutions

Before filing withdrawal applications before a Lok Adalat or Magistrate Court, complainants should verify case numbers, settlement records, payment confirmations and instructions authorising withdrawal.

Incorrect inclusion of a complaint in a withdrawal list may result in serious procedural consequences.

For Accused Persons

Where a complaint is validly withdrawn under Section 280 BNSS, the provision gives the withdrawal the legal effect of acquittal.

The precise nature of the court order and any subsequent challenge must nevertheless be examined.

For Practising Advocates

When a cheque bounce complaint is claimed to have been withdrawn accidentally, advocates should examine the withdrawal order, the relevant statutory remedy under the BNSS, the competent forum and applicable limitation requirements.

The present judgment does not identify a particular appeal section or decide whether the alleged mistake would justify setting aside the acquittal.

Frequently Asked Questions

Does Withdrawal of a Cheque Bounce Complaint Mean Acquittal?

Yes, where the withdrawal is permitted under Section 280 BNSS, the statutory consequence is acquittal of the accused against whom the complaint is withdrawn.

Can a Cheque Bounce Case Withdrawn by Mistake Be Restored?

The Rajasthan High Court did not decide whether the complaints in this case should be restored. It held that the complainant should pursue the appropriate statutory remedy under the BNSS, where the alleged mistake may be considered.

Can a Writ Petition Be Filed Against a Lok Adalat Withdrawal Order?

In this particular case, the High Court dismissed the writ petitions because the complainant had an available statutory remedy and had not shown sufficient grounds for bypassing it. The judgment does not establish a universal prohibition on constitutional remedies in every circumstance.

Did the High Court Decide Whether the Loans Were Repaid?

No. The High Court did not determine whether the borrowers had repaid their dues or whether the alleged clerical error was genuine.

Which BNSS Section Governs Withdrawal of a Complaint?

Section 280 BNSS governs withdrawal of a complaint in the relevant chapter concerning summons-case trials. Its effect must be examined in the context of the particular proceedings and order.

Conclusion

The Rajasthan High Court's judgment in Ugro Capital Ltd. v. Khaderam Yadav highlights the legal consequences of withdrawing cheque dishonour complaints under Section 138 of the Negotiable Instruments Act.

The Court held that withdrawal under Section 280 BNSS resulted in acquittal and that the complainant could not bypass the available statutory remedy by directly filing writ petitions.

At the same time, the High Court expressly preserved the complainant's right to seek relief before the competent court under the BNSS.

Official Judgment Reference

Case: Ugro Capital Ltd. v. Khaderam Yadav and connected petitions

Citation: 2026:RJ-JP:43492

Case Number: S.B. Civil Writ Petition No. 19188/2026

Decision: 27 October 2026

Court: Rajasthan High Court, Jaipur Bench

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Disclaimer: This article is published for general legal awareness based on the cited judgment. Case-specific remedies require examination of the original judicial orders and applicable procedural provisions.