Prima facie liability of a company director cannot be defeated at discharge stage by a disputed resignation plea.

Specific averments that a director was Chairman, in charge of, and responsible for the company's business were sufficient to disclose a prima facie case under Sections 138 and 141 of the Negotiable Instruments Act. A disputed plea that he had resigned before the cheques were issued could not justify discharge at the preliminary stage, particularly where the resignation documents were treated as suspicious. The revisional court was not entitled to evaluate defence material as if deciding the case on merits. Proceedings against the director were restored, leaving the resignation defence to be tested at trial.

---

---

Issues: Whether a director accused in a complaint under the Negotiable Instruments Act could be discharged at the preliminary stage on the basis of a disputed plea of prior resignation, despite clear averments that he was in charge of and responsible for the company's business.

Analysis: The complaint and the statement recorded under Section 202 of the Code of Criminal Procedure, 1973 contained specific averments that the respondent was the Chairman and Director and was in charge of the business of the company. On that basis, a prima facie case was made out for proceeding under Sections 138 and 141 of the Negotiable Instruments Act, 1881. The plea that the respondent had resigned before the cheques were issued raised a disputed question of fact, especially when the alleged resignation and related documents were themselves suspicious. At the stage of discharge, the revisional court was not justified in evaluating the defence evidence as though it were a court of appeal on merits.

Conclusion: The discharge was not justified and the respondent could not be exonerated at that stage; the finding in favour of discharge was set aside.

Final Conclusion: Proceedings against the respondent were restored for consideration in accordance with law, on the basis that the complaint disclosed a prima facie case and the defence of resignation required trial.

Ratio Decidendi: Where the complaint contains specific averments that a director was in charge of and responsible for the company's business, a disputed plea of resignation cannot be used to discharge him at the preliminary stage and the issue must ordinarily be tested at trial.

---