Company drawer requirement under Section 138 NI Act: statutory notice to the company is essential before fastening vicarious liability.

Where a cheque is drawn on a company account, the company is treated as the drawer for purposes of Section 138 of the Negotiable Instruments Act, 1881, and statutory notice must ordinarily be issued to it as a condition precedent to prosecution. Vicarious liability cannot be fastened on the signatory or another connected person unless the company is properly arraigned and served in accordance with law. As the cheque in question bore the company's name as account holder and no valid notice was served on the company, a complaint against the respondent alone was held not maintainable, and the challenge to the revisional order failed.

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Issues: Whether a complaint under Section 138 of the Negotiable Instruments Act, 1881 was maintainable against the respondent where the cheque was drawn on the company's account, the company was the drawer, and the statutory notice had not been issued to the company.

Analysis: The cheque, though signed by the respondent, bore the company's name as the account holder, making the company the drawer for the purposes of Section 138. The statutory scheme requires the payee to issue notice in writing to the drawer within the prescribed time, and compliance with that requirement is a condition precedent to prosecution. The legal position recognised in the authorities relied upon is that where liability is sought to be fastened vicariously on a person connected with a company, the company must ordinarily be arraigned as an accused and must receive an opportunity to defend itself. A signatory does not, by that fact alone, become the drawer of the cheque when the cheque is issued on the company's account. Since the company was not proceeded against in accordance with law and no valid notice was served on it, the foundation for proceeding against the respondent alone was absent.

Conclusion: The complaint was not maintainable against the respondent alone, and the impugned order setting aside the summoning order called for no interference.

Final Conclusion: The petition under Section 482 of the Code of Criminal Procedure, 1973 failed, and the challenge to the revisional order was rejected.

Ratio Decidendi: In a prosecution under Section 138 of the Negotiable Instruments Act, 1881 based on a cheque drawn on a company account, the company as drawer must ordinarily be arraigned and served with the statutory notice before vicarious liability can be fastened on the signatory or other connected person.

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