Section 148 NI Act (20% Deposit on Appeal in a Cheque Bounce Case): Explained (2026)

Explainer · Negotiable Instruments Act

Updated for 2026 · Claw Editorial

You have been convicted in a cheque bounce case, or your client has. You want to file an appeal, and then you learn that the appellate court may first ask you to deposit money. Many people only discover this at the first hearing, and it can decide whether the appeal even moves forward. This guide explains Section 148 of the Negotiable Instruments Act in plain terms: what it says, when it applies, how it differs from Section 143A, and what the Supreme Court has said about it. Last verified October 2026.

01The short definition

Section 148 of the Negotiable Instruments Act, 1881 says that when a person convicted under Section 138 (cheque dishonour) files an appeal, the appellate court may order the appellant to deposit a sum while the appeal is pending. That sum must be at least 20% of the fine or compensation awarded by the trial court.

The section was added by the 2018 amendment to the Act. Its purpose is simple. A cheque bounce complainant often waits years for the trial, and then more years for the appeal. The deposit gives the complainant some money early and discourages appeals filed only to buy time.

02What the section says

In simple words, Section 148 has four parts.

• Who it covers: an appellant who has been convicted under Section 138 and appeals against that conviction or sentence.
• The minimum deposit: the appellate court may direct the appellant to deposit a minimum of 20% of the fine or compensation awarded by the trial court.
• A higher amount is possible: 20% is the floor. The appellate court can order a larger sum.
• Time and release: the amount is to be deposited within sixty days of the order, with extensions possible for sufficient cause. The court may release it to the complainant at any time. If the appellant is later acquitted, the complainant must repay it with interest at the bank rate, within sixty days.

Always read the current bare text of the section on India Code before you cite it in a pleading.

03When Section 148 applies

Section 148 applies in a narrow situation. Check these points before you assume it is in play.

• There must be a conviction under Section 138. It does not apply if the accused was acquitted.
• The convicted person must be the appellant. The deposit is a condition on the person challenging the conviction. A complainant appealing an acquittal is under a different provision.
• The trial court must have awarded a fine or compensation. The 20% is worked out on that figure, not on the original cheque amount. In practice, trial courts often award compensation that is higher than the cheque amount, so read the final order carefully.
• The appellate court passes the order. It is usually the Sessions Court, and later the High Court if the matter goes further. The deposit is not automatic. It follows an order, usually when the appellant also asks for suspension of the sentence.

A common practical link: the appellant asks the appellate court to suspend the sentence under Section 389 CrPC (now Section 430 BNSS). The court will often attach the 20% deposit as a condition for that relief.

04Section 148 vs Section 143A

Both sections were inserted in 2018 and both aim to put some money in the complainant’s hands early. Mixing them up is a common mistake, so here is the difference.

Notice the base for the calculation. Under Section 143A the ceiling is 20% of the cheque amount. Under Section 148 the floor is 20% of the fine or compensation awarded. If an accused already paid interim compensation under Section 143A, the appellate court will usually take that into account, and the amount already paid is generally counted towards the Section 148 deposit.

05What the Supreme Court says

The word in the statute is “may”, which suggests the appellate court has a choice. The Supreme Court has read it more firmly.

Surinder Singh Deswal v. Virender Gandhi (2019)

The Supreme Court held that although Section 148 says “may”, the appellate court should ordinarily order the 20% deposit. The Court reasoned from the purpose of the amendment, which is to stop delay and protect honest payees. It also held that the section applies to appeals against convictions even where the Section 138 offence or the complaint pre-dates the 2018 amendment.

Jamboo Bhandari v. M.P. State Industrial Development Corporation Ltd. (2023)

A later Bench clarified that 20% is a strong default, not an absolute rule. In an exceptional case, the appellate court may reduce or waive the deposit, but it must record reasons for treating the case as exceptional. A bare order with no reasons is open to challenge.

What this means in practice

Expect the 20% deposit as the starting point. If you represent the appellant and want a waiver or reduction, you need a real reason on record, such as genuine inability to pay or a serious flaw in the trial judgment, not just the fact that you have appealed. If you represent the complainant, point the court to the default position and ask for release of the amount.

For Section 143A, the Supreme Court has also treated that power as discretionary and requiring reasons, so do not assume interim compensation is automatic at trial either.

06Practical points for advocates

• Do the arithmetic early. Take the exact fine or compensation from the trial judgment, work out 20%, and advise the client before filing the appeal.
• Plan the money. If the deposit will be ordered as a condition for suspension of sentence, the client should have funds ready on the first date.
• Ask for release and security terms. As complainant’s counsel, ask that the amount be released. Courts sometimes ask for security from the complainant for a possible refund.
• Track the order. Deposit deadlines and refund timelines are easy to miss. Put each date on your calendar the day the order is passed.
• Keep the cheque history straight. A clean record of the notice, the complaint and the trial order makes the deposit calculation and any later refund much simpler.

For adjacent criminal law explainers on this site, see Section 307 IPC (BNS) on attempt to murder and Section 354 IPC (BNS) on outraging modesty. Those are separate offences and are not governed by the NI Act.

07Where Claw fits

Claw is an all-in-one legaltech platform for Indian advocates, law firms, and corporate legal teams, combining AI-based case search, an AI legal assistant (Legal GPT), case management, and compliance automation across all Indian courts and tribunals.

For a Section 148 matter, two jobs come up. First, finding the right judgments: you can use Claw’s AI-based case search across the Supreme Court and 25 High Courts to look up how courts have treated the 20% deposit, with verified citations. Second, managing deadlines: Claw’s case management can track the appeal, the deposit date and the next hearing, and its auto-compliance feature can read a court order and set reminders for the dates in it. If you work in Delhi, see our guide to Delhi High Court case tracking software.

Claw has a free plan for individual advocates. Team and enterprise plans are paid. Claw does not use customer case documents to train AI models. Claw is a research and tracking tool, not a substitute for reading the judgment or the statute yourself.

08Sources and further reading

• Negotiable Instruments Act, 1881 (bare text, Sections 138, 143A, 148): indiacode.nic.in
• Supreme Court of India (official judgments): sci.gov.in
• Claw: clawlaw.in

This page is general information and not legal advice. Last verified October 2026. Statute text and case holdings should be checked against the primary source before you rely on them.

09Frequently asked questions