Vicarious liability under cheque dishonour law does not extend to a sole proprietorship's alleged partners.

Section 141 of the Negotiable Instruments Act applies only to a company, partnership firm or association of persons, and not to a sole proprietorship concern. Where the record showed that Ayyappa Traders was a proprietorship and the cheque-signing accused was the proprietor, the complaint could not fasten vicarious liability on persons merely described as partners. The proceedings were therefore not maintainable against the alleged partners and were quashed to that extent, while the prosecution against the proprietor who issued the cheques was permitted to continue.

---

---

Issues: Whether the proceedings under Section 138 of the Negotiable Instruments Act, 1881 were maintainable against the persons shown as partners and the proprietary concern when the materials on record indicated that the business was a sole proprietorship, and whether Section 141 of the Negotiable Instruments Act, 1881 could be invoked to fasten vicarious liability on others.

Analysis: The complaint described the accused as proprietors or partners, but the cheque copies, income tax returns, balance sheet, and audit reports showed that the person who signed the cheques was the proprietor of Ayyappa Traders. The complainant did not produce documentary material to establish that the concern was a partnership firm. Section 141 of the Negotiable Instruments Act, 1881 applies to a company, partnership firm, or association of persons, and not to a sole proprietorship concern. In the case of a sole proprietorship, there is no separate juristic person and no basis for vicarious liability against other individuals merely by describing them as partners.

Conclusion: The proceedings were not maintainable against the persons shown as petitioners 2 and 3, and they were quashed to that extent. The proceeding was permitted to continue against the proprietor who issued the cheques.

Final Conclusion: The criminal petition succeeded only in part by deleting the other accused from the prosecution, while leaving the prosecution against the proprietor intact.

Ratio Decidendi: Vicarious liability under Section 141 of the Negotiable Instruments Act, 1881 cannot be invoked against a sole proprietorship concern or its alleged partners, and liability for dishonour of cheque rests on the proprietor who issued the cheque.

---