Cheque dishonour liability requires clear averments of control, and quashing fails without unimpeachable proof of non-involvement.

In cheque dishonour prosecutions, directors can face liability only if the complaint contains basic averments that they were, at the relevant time, in charge of and responsible for the company's business; mere designation as a director is insufficient. Here, the complaint described the applicants as persons in charge of the company's affairs, and the record also referred to their audit committee role and receipt of remuneration, which weakened the claim that they were wholly unconnected. In a quashing petition, interference is justified only on unimpeachable material showing no concern with the transaction, and no such material was produced; the proceedings were therefore not liable to be quashed.

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Issues: Whether the criminal proceedings under Section 138 of the Negotiable Instruments Act, 1881 against the applicants, who claimed to be non-executive and independent directors, deserved to be quashed in exercise of inherent powers under Section 482 of the Code of Criminal Procedure, 1973.

Analysis: For fastening criminal liability on directors of a company in a cheque dishonour prosecution, the complaint must contain the essential averment that the accused were, at the relevant time, in charge of and responsible for the conduct of the company's business. Mere designation as a director is not enough, but a complaint containing such basic averments can survive quashing. The Court also noted that the applicants were described in the complaint as persons in charge and responsible for the company's affairs, and that the materials placed on record showed their association with the audit committee and receipt of remuneration, which negatived the plea that they were wholly alien to the company. In a quashing petition, the accused can avoid trial only by producing unimpeachable material showing that they could not have been concerned with the transaction; such a case was not made out.

Conclusion: The complaint disclosed a sufficient prima facie basis to proceed against the applicants, and the proceedings were not liable to be quashed.

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