Power to direct interim compensation
Section 143A of the Negotiable Instruments Act, 1881 deals with power to direct interim compensation. Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), 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 accusa The Act came into force on 01 Mar 1882.
1[143A. Power to direct interim compensation.--(1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974), 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 sub-section (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.]
Section 143A, The Negotiable Instruments Act, 1881 (Act 26 of 1881).
Cross-references
Extracted from the operative text of the enactments themselves. Every destination below exists in our corpus.
This section refers to
Related judgements & precedents
These are some judgments that construed this section, and hold precedence value. They hold authority on how to read, interpret and use this section.
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G.J. Raja v. Tejraj Surana
Court's Decision & Legal Precedent
NI Act s.143A (interim compensation) is prospective only. It does not apply to complaints pending on the date the section was inserted (2018).
On this section: Interim compensation under s.143A cannot be ordered in complaints instituted before 1 September 2018.
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Madhav Saran Agarwal vs Msx Mall Pvt. LTD
Court's Decision & Legal Precedent
Section 138/141 proceedings under the Negotiable Instruments Act against a corporate debtor are covered by the moratorium provision in Section 14(1)(a) of the Insolvency and Bankruptcy Code, 2016, as such proceedings relate to transactions evidencing debt of the corporate debtor and result in depletion of its assets through compensation orders, thereby directly impacting the object of the moratorium which is to preserve the corporate debtor's assets during the insolvency resolution process so it can continue as a going concern and be rehabilitated. However, the moratorium applies only to the corporate debtor and not to natural persons (Directors/officers) in charge of and responsible for the conduct of the business of the corporate debtor, who remain liable to prosecution under Section 138/141 as the corporate debtor is a necessary party to such proceedings.
On this section: Cited to show compensatory nature of Section 138 proceedings; interim compensation up to 20% of cheque amount
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Naresh Kumar Gupta vs Sood Resins and Polymers
Court's Decision & Legal Precedent
Section 138/141 proceedings under the Negotiable Instruments Act against a corporate debtor are covered by the moratorium provision in Section 14(1)(a) of the Insolvency and Bankruptcy Code, 2016, as such proceedings are 'proceedings' within the meaning of that section. The moratorium applies only to the corporate debtor and not to natural persons (Directors and officers) who can continue to be prosecuted under Section 141 of the Negotiable Instruments Act. The rules of statutory construction (noscitur a sociis and ejusdem generis) cannot be applied to restrict the meaning of 'proceedings' in Section 14(1)(a) when the expression is designedly wide and the object of the statute is clear - which is to preserve the corporate debtor's assets during the insolvency resolution process.
On this section: Analyzed to show shift towards compensatory object of Section 138 proceedings
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MORNING STORES NKM PVT. LTD. vs STATE NCT OF DELHI
Court's Decision & Legal Precedent
The Revisional Court will not interfere with a Magistrate’s discretionary order for interim compensation under S. 143A NI Act unless the order is perverse, unreasonable, or based on no material.
On this section: Provision for interim compensation during trial.
The holding above is the ratio decidendi as extracted from the judgment by eCourts India, reproduced unaltered — it is a rendering of the court's reasoning, not a substitute for its words. Read the order itself before relying on it.
Judgments citing this section
These may be obiter dicta or a precedent, for you to study. These are the judgments where this section is quoted.
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… The present Appeal is filed assailing the correctness of these orders vis-à-vis the larger question of law, as framed by the High Court: "Whether the signatory of the cheque, authorized by the "Company", is the "drawer" and whether such signatory could be directed to pay interim compensation in terms of section 143A of the Negotiable Instruments Act, 1881 leaving aside the company?" 14. The High Court, in its judgment dated 08.03.2023 in Criminal Application No.886 of 2022, answered the above question in the negative and upheld the same in its order dated 29.03.2023 in the case of the appellant before us. To answer the …
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… passed by the learned Metropolitan Magistrate – 05, (NI Act), South-District, Delhi (hereinafter referred to as the 'Trial Court') in CT Case No.5061/2020, titled as Addon Realty Private Limited v. Shivalik Ventures Private Limited And Ors. , allowing the application filed by the respondent no.2 / complainant under Section 143A of the Negotiable Instruments Act, 1881 (in short, 'NI Act') and directing the petitioners to pay to the respondents no.2 interim compensation at 12% of the cheque amount, that is, Rs.2,71,52,880/- within 60 days of the passing of the order. 2. The above captioned remaining petition(s) being Crl. Rev. P No(s). …
Questions about Section 143A
What have the courts held on Section 143A of the Negotiable Instruments Act?
G.J. Raja v. Tejraj Surana (30 Jul 2019) is the leading judgment on this section among those set out below: Interim compensation under s.143A cannot be ordered in complaints instituted before 1 September 2018. Another 3 judgments on this section are set out below, 3 of them from the Supreme Court. They run from 2019 to 2024.
How do I find court cases under Section 143A of the Negotiable Instruments Act?
In judgments and charge sheets this section is written several ways, and each form finds a different set of orders. These search the full text of every order eCourtsIndia holds, best matches first: NI Act 143A, section 143A NI Act, section 143A of the Negotiable Instruments Act. People searching for it also type ni act 143a judgements and negotiable instrument act 143a. Each opens the full list of orders on eCourtsIndia, where it can be narrowed by court, year and outcome. 4 reported judgments on this section are set out on this page, beginning with G.J. Raja v. Tejraj Surana (30 Jul 2019).
What should I read with Section 143A of the Negotiable Instruments Act, and has it changed?
Its own text turns on section 138 (Dishonour of cheque for insufficiency, etc., of funds in the account), so none of them can safely be read on its own. 1 other provision in this corpus refers back to it.
When did Section 143A of the Negotiable Instruments Act come into force?
Section 143A of the Negotiable Instruments Act, cited as NI Act 143A, came into force on 01 Mar 1882, having been enacted on 09 Dec 1881. It is in force as at the date shown on this page.
Other sections of this Act
- 138. Dishonour of cheque for insufficiency, etc., of funds in the account312 words
- 142A. Validation for transfer of pending cases299 words
- 143. Power of Court to try cases summarily297 words
- 142. Cognizance of offences290 words
- 141. Offences by companies287 words
- 84. When cheque not duly presented and drawer damaged thereby279 words
Source and method. Compiled from the enactments of Parliament and of the State legislatures as published on India Code, and republished together with commentary and other original matter under section 52(1)(q)(ii) of the Copyright Act, 1957. Structured, cross-referenced and maintained by eCourtsIndia. Text as in force on 15 Oct 2026. This page is not a substitute for legal advice.