Limitation under cheque dishonour law runs from the first valid demand notice, and vague director allegations do not sustain vicarious liability.

A complaint under the Negotiable Instruments Act was held time-barred where the drawer had already received an earlier valid demand notice, because limitation runs from expiry of fifteen days after receipt of that first notice and a later notice cannot revive or extend the cause of action. The Court also found the pleadings against the directors insufficient, since liability under Section 141 requires specific averments that they were in charge of and responsible for the company's business at the relevant time; mere description as a director was not enough. The criminal proceeding was therefore quashed in full.

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Issues: (i) Whether the complaint under Section 138 of the Negotiable Instruments Act was barred by limitation on the basis that an earlier demand notice had already been issued and received; (ii) Whether the complaint contained sufficient averments to proceed against the directors under Section 141 of the Negotiable Instruments Act.

Issue (i): Whether the complaint under Section 138 of the Negotiable Instruments Act was barred by limitation on the basis that an earlier demand notice had already been issued and received.

Analysis: The Court accepted the supplementary affidavit and the annexed notices as establishing that a first demand notice had been issued after dishonour of the cheque and had been received by the drawer. On that footing, the Court applied the settled principle that once notice under clause (b) of Section 138 is issued, the statutory period for filing the complaint runs from the expiry of fifteen days from receipt of that notice, and a later notice cannot be used to create a fresh cause of action to extend limitation.

Conclusion: The complaint was held to be hopelessly barred by limitation and incapable of being sustained on the basis of the later notice.

Issue (ii): Whether the complaint contained sufficient averments to proceed against the directors under Section 141 of the Negotiable Instruments Act.

Analysis: The Court applied the settled requirement that, for fastening liability on persons other than the company, the complaint must contain specific averments showing that such persons were in charge of and responsible for the conduct of the business of the company at the relevant time. On the facts pleaded, the Court found that the allegations against the second petitioner were not sufficiently specific to attract Section 141, and that mere description as a director was not enough.

Conclusion: The allegations were found insufficient to proceed against the directors under Section 138 read with Section 141 of the Negotiable Instruments Act.

Final Conclusion: The criminal proceeding was quashed in its entirety because the complaint was barred by limitation and the allegations did not adequately establish the statutory basis for proceeding against the company officials.

Ratio Decidendi: A complaint under Section 138 of the Negotiable Instruments Act must be filed within the statutory period computed from the expiry of fifteen days after receipt of the first valid demand notice, and vicarious liability under Section 141 arises only when the complaint specifically alleges that the accused was in charge of and responsible for the conduct of the company's business at the relevant time.

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