Vicarious liability under cheque dishonour law needs specific averments; proceedings against a non-signatory director were quashed.

Vicarious liability under Section 141 of the Negotiable Instruments Act does not arise merely from a corporate designation; the complaint must contain clear, specific averments that the accused was in charge of and responsible for the company's business at the relevant time. A non-signatory Chairman or non-executive director cannot be proceeded against on generalized assertions alone, especially where no executive role in day-to-day affairs is pleaded and no supporting material exists. The absence of the accused's signature on the cheque, the role of the Managing Director as signatory, and the dropping of similarly placed directors reinforced the lack of a sufficient factual basis. The complaints and consequential proceedings were quashed qua the petitioner.

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Issues: Whether criminal complaints under Section 138 read with Sections 141 and 142 of the Negotiable Instruments Act, 1881, and the connected summoning and notice orders, were liable to be quashed qua a non-signatory Chairman/non-executive director for want of specific averments showing that he was in charge of and responsible for the conduct of the company's business.

Analysis: Vicarious liability of a director under Section 141 of the Negotiable Instruments Act, 1881 does not arise merely from holding a designation or office in the company. The complaint must contain clear and specific factual averments showing that the accused was in charge of and responsible for the conduct of the business of the company at the relevant time. A Chairman, without material showing an executive role in the company's day-to-day affairs, cannot be presumed to be liable only by reason of the designation. Where the complaint contains only general assertions and no specific role is attributed, continuation of proceedings may amount to abuse of process. The absence of the petitioner's signature on the cheques, the presence of the Managing Director as the signatory, the dropping of similarly placed directors, and the lack of additional material against the petitioner reinforced the absence of a sufficient factual basis for prosecution.

Conclusion: The petition was allowed and the complaints and consequential proceedings were quashed qua the petitioner.

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