Cheque Dishonour Liability depends on post-notice non-payment and specific averments for partner liability.

Dishonour of a cheque under Section 138 of the Negotiable Instruments Act is completed only when, after service of statutory notice, the drawer fails to pay within fifteen days; on that basis, territorial jurisdiction may lie where the payment obligation is to be discharged, including the creditor's place. The complaint also failed to sustain vicarious liability against a partner under Section 141 because it did not specifically aver that the partner was in charge of and responsible for the firm's business at the time of the offence. Proceedings were therefore maintainable against the firm and the drawer, but not against the partner.

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Issues: (i) Whether dishonour of the cheques and failure to pay within the statutory period constituted an offence under Section 138 of the Negotiable Instruments Act, 1881 and whether the Ambala court had territorial jurisdiction; (ii) Whether the complaint contained the necessary averments to proceed against Jagpal Singh as a partner under Section 141 of the Negotiable Instruments Act, 1881.

Issue (i): Whether dishonour of the cheques and failure to pay within the statutory period constituted an offence under Section 138 of the Negotiable Instruments Act, 1881 and whether the Ambala court had territorial jurisdiction.

Analysis: Section 138 creates the offence only when a cheque returned unpaid for insufficiency of funds or comparable reasons is followed by service of notice and failure to pay within fifteen days of receipt of that notice. The offence is completed not by issuance of the cheque but by omission to make payment within the statutory period after notice. On that footing, the cause of action arises when the drawer fails to pay after notice, and the place where the creditor is located may furnish territorial jurisdiction because the liability is to be discharged at the creditor's place.

Conclusion: The offence under Section 138 was made out, and the Ambala court had territorial jurisdiction.

Issue (ii): Whether the complaint contained the necessary averments to proceed against Jagpal Singh as a partner under Section 141 of the Negotiable Instruments Act, 1881.

Analysis: Vicarious liability under Section 141 extends to persons who, at the time of the offence, were in charge of and responsible for the conduct of the business of the firm, or to those whose consent, connivance, or neglect is specifically pleaded and proved. A mere reference to partnership status is not enough. The complaint disclosed that Baljinder Singh issued the cheques, but it did not contain the requisite averment that Jagpal Singh was in charge of the business or responsible for its conduct.

Conclusion: The complaint could not be sustained against Jagpal Singh.

Final Conclusion: The proceedings were sustained against the firm and Baljinder Singh, while the complaint and consequential proceedings were quashed only as against Jagpal Singh.

Ratio Decidendi: An offence under Section 138 is completed only upon failure to make payment within fifteen days of notice, and vicarious liability under Section 141 arises only where the complaint specifically alleges that the partner or officer was in charge of and responsible for the conduct of the business.

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