Vicarious liability of company directors under cheque dishonour law depends on substance of pleadings, not formulaic wording.

In prosecutions under the Negotiable Instruments Act, vicarious liability of company directors depends on factual averments showing that they were in charge of and responsible for the company's business at the relevant time. The complaint is not defeated by the absence of exact formulaic words if, read as a whole, it discloses that the directors acted for the company, issued the cheque, or assured its honour. Where the record shows a prima facie case under Section 138, disputed defences such as a blank cheque or forgery are not examined at the quashing stage. The complaint and summoning order were therefore not liable to be quashed.

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Issues: Whether the complaint and summoning order under the Negotiable Instruments Act were liable to be quashed in exercise of inherent jurisdiction on the ground that the complaint lacked specific averments showing that the company directors were in charge of and responsible for the conduct of the company's business.

Analysis: For fastening vicarious liability on directors in a prosecution arising out of dishonour of cheque, the complaint must contain the necessary factual averments showing that, at the relevant time, they were in charge of and responsible for the conduct of the company's business. At the same time, the complaint is not to be read with pedantic insistence on formulaic language; its substance must be seen as a whole. If the overall allegations disclose that the accused directors were acting for the company and had issued the cheque or assured its honour, the requirement of Section 141 is not defeated merely because the exact statutory words are not repeated. The material placed before the Court also showed a prima facie case under Section 138, and disputed defences such as alleged blank cheque or forgery could not be examined at the quashing stage.

Conclusion: The complaint disclosed the necessary factual foundation to proceed against the directors, and the request to quash the proceedings and the summoning order was not sustainable.

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