Vicarious liability under the Negotiable Instruments Act requires specific averments against directors; resigned non-signatories cannot be prosecuted.

Vicarious criminal liability of company directors under Section 141 of the Negotiable Instruments Act depends on clear and specific averments that the director was in charge of, and responsible for, the company's business at the relevant time. A bare statement that all directors are liable is insufficient. Where the record shows that independent directors had resigned before the cheque date, and the complaint does not allege that they were signatories to the cheque or involved in day-to-day management, proceedings against them cannot be sustained and are liable to be quashed as an abuse of process.

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Issues: Whether proceedings under the Negotiable Instruments Act could be sustained against non-signatory independent directors after their resignation, in the absence of specific averments showing that they were in charge of and responsible for the conduct of the company's business.

Analysis: Liability of a director for an offence by the company is not automatic. For vicarious liability to arise under Section 141 of the Negotiable Instruments Act, the complaint must contain specific averments showing how and in what manner the director was responsible for the conduct of the business of the company. A bald assertion that all directors are liable is insufficient. The resignation material placed on record showed that the petitioners had ceased to be directors before the cheque date, and there was no allegation that they were signatories to the cheque or in charge of the company's day-to-day affairs when the offence was alleged to have occurred.

Conclusion: The proceedings against the petitioners could not be sustained and were liable to be quashed.

Final Conclusion: The complaint did not disclose the ingredients necessary to fasten criminal liability on the petitioners as directors, and continuation of the prosecution would amount to abuse of process.

Ratio Decidendi: Vicarious criminal liability of company directors under Section 141 of the Negotiable Instruments Act requires clear and specific averments showing active responsibility for the company's business at the relevant time; in their absence, proceedings against non-signatory directors are liable to be quashed.

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