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Section 143A: Power to Direct Interim Compensation to Complainant

Negotiable Instruments Act • Official Statutory Text & Practice Guide

Bailable
Non-Cognizable
Judicial Magistrate First Class / Metropolitan Magistrate
Act 1881
All 148 Sections of Negotiable Instruments Act

Legal Commentary & Landmark Judgments: Section 143A

Section 143A empowers the trial court to direct the drawer to pay interim compensation not exceeding twenty per cent of the cheque amount to the complainant during the pendency of the trial.

  • Discretionary Power Up to 20%: The court MAY direct interim compensation up to 20% of the cheque amount; the power is discretionary, not mandatory.
  • Trial Stage for Ordering: May be directed in a summary trial or summons trial where the drawer pleads not guilty upon the framing of notice/charge.
  • 60-Day Payment Timeline: Interim compensation must be paid within 60 days (extendable by 30 days on sufficient cause shown).
  • Refund with Interest on Acquittal: If the accused is ultimately acquitted, the complainant must refund the entire interim compensation with RBI bank interest within 60 days.
Key Landmark Precedents:
  • Rakesh Ranjan Shrivastava v. State of Jharkhand (2024) 4 SCC 719: The Supreme Court authoritatively settled that the power under Section 143A is discretionary, not mandatory; the trial court must apply its judicial mind, consider prima facie merits, financial hardship, and record reasons before ordering interim compensation.
  • G.J. Raja v. Tejraj Surana (2019) 19 SCC 469: The Supreme Court held that Section 143A creates a substantive liability and operates purely PROSPECTIVELY; it applies only to offences committed after its enforcement on September 1, 2018.
  • Noor Mohammed v. Khurram Pasha (2022) 9 SCC 23: Held that failure to deposit interim compensation under Section 143A cannot result in striking off the accused's defence; the amount can be recovered only as an unpaid fine under Section 421 CrPC.
Courtroom Practice & Strategic Litigation Guidance:

For complainants, move a formal Section 143A application immediately after the accused pleads not guilty to notice, demonstrating the strong prima facie case (signature admitted, bank memo unquestioned). For defence counsel, cite Rakesh Ranjan Shrivastava (2024): argue that Section 143A is not automatic, show that genuine triable issues exist, and prove financial hardship to defeat or minimize the deposit.

All 148 Sections of Negotiable Instruments Act