Cheque dishonour and vicarious company liability sustained where admissions and specific averments proved responsibility for the transaction.

Cheque dishonour liability under Section 138 was upheld where the cheque transaction, dishonour memos, statutory notice, and reply notice proved issuance of cheques towards partial discharge of liability and insufficiency of funds on presentation. The accused admitted the transaction, the liability, and issuance of the cheques, and no defence evidence was led to rebut the prosecution case. Vicarious liability under Section 141 was also sustained because the complaint specifically averred that the accused was the Managing Director, in charge of and responsible for the company's day-to-day affairs, and the record showed his active involvement and issuance of the cheques. The revision failed and the conviction and sentence, as modified in appeal, remained undisturbed.

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Issues: (i) Whether the conviction for dishonour of cheques under Section 138 of the Negotiable Instruments Act, 1881 was liable to be interfered with. (ii) Whether the requirements for fastening vicarious liability on the Managing Director of the company under Section 141 of the Negotiable Instruments Act, 1881 were satisfied.

Issue (i): Whether the conviction for dishonour of cheques under Section 138 of the Negotiable Instruments Act, 1881 was liable to be interfered with.

Analysis: The cheque transaction, dishonour memos, statutory notice, and reply notice established the issuance of cheques towards partial discharge of liability and their dishonour for insufficiency of funds. The accused admitted the transaction, liability, and the issuance of cheques, and no defence evidence was adduced to dislodge the prosecution case.

Conclusion: The conviction under Section 138 of the Negotiable Instruments Act, 1881 was upheld.

Issue (ii): Whether the requirements for fastening vicarious liability on the Managing Director of the company under Section 141 of the Negotiable Instruments Act, 1881 were satisfied.

Analysis: The complaint contained specific averments that the accused was the Managing Director and was in charge of and responsible for the day-to-day affairs of the company at the relevant time. The accused also admitted his role in the company and his involvement in the transaction, and the record showed that he had issued the cheques. On these facts, the statutory conditions for company liability and vicarious liability were met.

Conclusion: Vicarious liability under Section 141 of the Negotiable Instruments Act, 1881 was correctly fastened on the accused.

Final Conclusion: The revision failed, and the conviction and sentence, as modified in appeal, were left undisturbed.

Ratio Decidendi: To fasten liability on an individual for an offence by a company under Section 141 of the Negotiable Instruments Act, 1881, the complaint must contain specific averments that the person was in charge of and responsible for the conduct of the business of the company at the relevant time, and such liability may be sustained where the evidence also shows active involvement in the cheque transaction.

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