Interim compensation under Section 143A: getting paid before the judgment

A cheque bounce trial can outlast the debt it concerns. Section 143A of the Negotiable Instruments Act exists so that the complainant is not left financing the delay while the drawer enjoys the benefit of it.

What the provision allows

• The trial court may direct the drawer to pay interim compensation to the complainant.
• The amount is capped at twenty per cent of the cheque amount.
• It may be ordered where the accused pleads not guilty, and is payable within the period the court directs.
• If the accused is ultimately acquitted, the complainant repays with interest.

How it is exercised

The power is discretionary, not automatic. Courts look at the strength of the complainant's case on the face of the record, the conduct of the accused, and the nature of the transaction. An application supported by the underlying invoices and account statements does considerably better than one that rests on the cheque alone.

Using it as leverage

1. Apply early, at the stage the plea is recorded, rather than midway through evidence.
2. Quantify precisely and justify the percentage sought.
3. Note the recovery mechanism available if the direction is not complied with.
4. Factor the order into any settlement discussion — it usually reframes one.

For a creditor carrying several dishonoured cheques, this is often the provision that converts a long trial into an early settlement.