1. INTRODUCTION
The Negotiable Instruments (Amendment) Act, 2018 (the
"Amendment") was recently passed by
parliament and came into effect from September 1, 2018. It
introduces substantial changes to the Negotiable Instruments Act,
1881 (the "Act"), which may have a
significant impact on commerce and the ability of parties to
transact through negotiable instruments.
This alert highlights the key changes introduced under the
Amendment, and considers their impact on the complainant (the
"Complainant") and the drawer (the
"Drawer") of dishonored cheques.
2. KEY CHANGES
2.1. Drawer to pay interim compensation to the Complainant
The Amendment inserts a new section, Section 143A, in the Act.
It empowers the courts, in a summons trial or a summons case, to
direct the Drawer to pay interim compensation to the Complainant,
in two scenarios: (i) at the time the Drawer pleads not
guilty to the accusations made in the complaint; or (ii) at
the time of framing of the
