Section 141 NI Act liability requires trial evidence before quashing complaints against company officers.

Proceedings under Section 138 read with Section 141 of the Negotiable Instruments Act could not be quashed at the threshold merely because the complaint allegedly did not sufficiently spell out the accused's role in the company. Whether the accused was in charge of and responsible for the conduct of the company's business, and whether the deeming provision in Section 141(2) applied, were matters requiring evidence at trial. The defence of lack of knowledge or due diligence under the proviso to Section 141(1) also lay on the accused. The criminal prosecution was therefore held triable and was allowed to proceed before the trial court.

---

---

Issues: Whether proceedings for offences under Section 138 of the Negotiable Instruments Act, 1881 read with Section 141 of that Act could be quashed or dropped at the threshold on the ground that the complaint did not sufficiently show that the accused were in charge of and responsible for the conduct of the company's business.

Analysis: The allegations had to be tested on the materials to be led at trial. Whether an accused was in charge of, and responsible to, the company for the conduct of its business, and whether the deeming fiction in Section 141(2) was attracted, were questions requiring adjudication on evidence. The proviso to Section 141(1) also contemplated a defence of lack of knowledge or due diligence, the burden of which lay on the accused. The complaint could not be terminated at the threshold merely because the accused denied involvement in management.

Conclusion: The prayer to quash or drop the criminal proceedings was rightly refused, and the challenge failed.

Final Conclusion: The prosecution was held to be triable, and the matters were allowed to proceed before the trial court, with no opinion expressed on the merits.

---