Cheque dishonour for incomplete or mismatched signatures may still attract liability under Section 138 of the Negotiable Instruments Act.

Dishonour of a cheque due to incomplete or mismatched signatures can attract liability under Section 138 of the Negotiable Instruments Act. The court noted that the provision has been interpreted broadly to advance its purpose and has already been applied beyond insufficiency of funds, including stop-payment and account-closed situations. Relying on Laxmi Dyechem, it held that a return for incomplete signatures, no image, or signature mismatch may still fall within Section 138, and treated the earlier contrary view in Vinod Tanna as not followed. The challenge to the complaint and process order therefore failed.

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Issues: Whether dishonour of a cheque due to incomplete or mismatched signatures attracts liability under Section 138 of the Negotiable Instruments Act.

Analysis: The Court noted that Section 138 had been interpreted broadly to advance its object and had been applied not only to dishonour for insufficiency of funds or excess arrangement, but also to cases such as stop-payment instructions and account-closed returns. It further noted that the later decision in Laxmi Dyechem held that a cheque returned for incomplete signatures, no image, or signature mismatch can still fall within Section 138, and that the earlier contrary view in Vinod Tanna had not been followed as it was treated as per incuriam in the light of the later binding precedent.

Conclusion: Dishonour of a cheque for incomplete signatures can constitute an offence under Section 138 of the Negotiable Instruments Act, and the petitioners' challenge to the complaint and process order fails.

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