Interim compensation under Section 143A is discretionary, and a 20% award needs reasons and application of mind.

Section 143A of the Negotiable Instruments Act confers a discretionary power to award interim compensation, because the court "may order" payment and is not bound to grant it in every case where the drawer has not pleaded guilty. The provision also caps compensation at 20% of the cheque amount, but the court must still apply its mind to the facts and record reasons for both granting compensation and fixing the quantum. An order treating 20% as automatic, without reasoned exercise of discretion, lacks application of mind and cannot be sustained, especially where recovery consequences may follow under the Code of Criminal Procedure. The order was therefore quashed with consequential relief.

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Issues: Whether an order directing payment of interim compensation under Section 143A of the Negotiable Instruments Act, 1881 could be sustained when the court treated payment of 20% of the cheque amount as automatic and recorded no reasons for exercising discretion.

Analysis: Section 143A confers discretion on the court by using the expression "may order" and does not make grant of interim compensation mandatory in every case where the drawer has not pleaded guilty. The quantum of interim compensation is capped at 20%, but the provision still requires the court to apply its mind to the facts of the case and record reasons for granting compensation and for fixing the amount. An order made without reasoned exercise of discretion reflects no application of mind and cannot be sustained, particularly when non-payment may trigger recovery proceedings under Sections 421 and 357 of the Code of Criminal Procedure, 1973.

Conclusion: The order granting interim compensation at 20% without reasons was unsustainable and was quashed, with consequential relief against attachment and auction and with the revisional proceedings directed to be decided afresh.

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