Section 143A explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 143A lets the court trying a section 138 case order the drawer to pay the complainant interim compensation before the case is decided. It was inserted by the Negotiable Instruments (Amendment) Act, 2018 (No. 20 of 2018), assented to on 2 August 2018. It is not in the consolidated text of the Act consulted, so this article is based on the gazette text of the 2018 Act. If you are a complainant or a drawer facing such an order, our legal dispute resolution team can help you plan for it.
The Court trying a section 138 offence may order the drawer to pay interim compensation to the complainant: in a summary trial or summons case, where he pleads not guilty; in any other case, upon framing of charge (sub-section (1)). It shall not exceed twenty per cent of the amount of the cheque (sub-section (2)). It is payable within sixty days of the order, or a further period not exceeding thirty days on sufficient cause shown by the drawer (sub-section (3)). On acquittal, the complainant must repay it with interest (sub-section (4)). Commencement is by notification; the date is not in the text consulted.
Source and commencement
The 2018 Act has three sections. Section 1(2) says it comes into force on a date the Central Government appoints by notification in the Official Gazette. That notification is not in the text consulted, so no commencement date is given here. Nothing later than the 2018 gazette is covered.
The section opens "Notwithstanding anything contained in the Code of Criminal Procedure, 1973". The text refers to that Code (and to sections 421 and 357 of it); check the current procedural law for the corresponding provisions.
When the court may order it: sub-section (1)
The Court "trying an offence under section 138" "may order the drawer of the cheque to pay interim compensation to the complainant". The word is "may", so the order is within the court's power and not automatic. It is available at two points:
| Type of case | When the order may be made |
|---|---|
| Summary trial or summons case | Where the drawer pleads not guilty to the accusation made in the complaint (clause (a)) |
| Any other case | Upon framing of charge (clause (b)) |
The offence itself, with its notice and payment periods, is in our post on section 138. The summary trial provision is covered in section 143.
How much: sub-section (2)
"The interim compensation under sub-section (1) shall not exceed twenty per cent. of the amount of the cheque." Twenty per cent is a ceiling here, measured against the amount of the cheque. For a cheque of Rs. 5,00,000 (an invented figure), the order cannot exceed Rs. 1,00,000.
Time to pay: sub-section (3)
The 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". So the outer limit the text allows is sixty days plus a further period of up to thirty days, and the extra period needs sufficient cause shown by the drawer.
If the drawer is acquitted: sub-section (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". The repayment is "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". The word is "shall", and the text states no other rate.
Recovery and set-off: sub-sections (5) and (6)
- Recovery (5). The interim compensation "may be recovered as if it were a fine under section 421 of the Code of Criminal Procedure, 1973".
- Set-off (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, shall be reduced by the amount paid or recovered as interim compensation under this section." So what has been paid or recovered is deducted from the final fine or compensation.
Section 143A and section 148: two different stages
The 2018 Act also inserted section 148. The two sections are easy to confuse.
| Point | Section 143A | Section 148 |
|---|---|---|
| Stage | During the trial | In an appeal by the drawer against conviction |
| Who orders | The Court trying the offence | The Appellate Court |
| What | Interim compensation to the complainant | A deposit by the appellant |
| Twenty per cent of | The amount of the cheque (a ceiling) | The fine or compensation awarded by the trial Court (a minimum) |
| Time to pay | Sixty days, plus up to thirty more on sufficient cause | Sixty days, plus up to thirty more on sufficient cause |
The proviso to section 148(1) says the deposit "shall be in addition to any interim compensation paid by the appellant under section 143A".
Work out your dates
Interim compensation comes only after a section 138 complaint, so the proviso periods must be met first; check yours with our cheque bounce notice calculator. Once an order is made, note its date, because the sixty days run from it.
Common mistakes
- Treating twenty per cent as a fixed amount; sub-section (2) says the compensation "shall not exceed" it.
- Missing that the sixty days run from the date of the order, not from the date of the complaint.
- Assuming the extra thirty days are automatic; they need sufficient cause shown and a direction of the Court.
- Confusing section 143A (trial) with section 148 (appeal).
Need help with an interim compensation order?
The timelines are short and the consequences of default are recovery as a fine. Our legal dispute resolution service reviews the order, the dates and the next steps.
Key takeaways
- The Court trying a section 138 offence may order interim compensation; it is not automatic.
- It is not more than twenty per cent of the cheque amount.
- Pay within sixty days, with up to thirty more on sufficient cause.
- On acquittal it is repaid with interest at the bank rate prevalent at the beginning of the relevant financial year.
- It is deducted from the final fine or compensation.
Read next
- Section 138: cheque bounce offence
- Section 139: presumption in favour of the holder
- Section 141: offences by companies
- Section 148: deposit pending appeal
Disclaimer: Based on the gazette text of the Negotiable Instruments (Amendment) Act, 2018 (No. 20 of 2018), as read on 2 October 2026; commencement is by notification and the date is not in the text consulted. Procedural law and later amendments should be checked in their current form. This article is general information, not legal advice.