Strict pleading for Section 141 liability bars prosecution of an Independent Director without specific averments of control.

Vicarious liability under Section 141 of the Negotiable Instruments Act is penal and must be strictly construed. A complaint must contain clear, specific averments showing that a director was in charge of and responsible for the company's business at the time of the offence; a mere assertion of directorship is insufficient. For a non-executive or Independent Director, liability cannot be inferred unless the complaint pleads direct involvement in the business or the transaction. On the pleaded facts, general allegations of day-to-day responsibility were unsupported, while the accused was an Independent Director and not a cheque signatory.

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Issues: Whether a non-executive Independent Director, who was not a signatory to the dishonoured cheques, could be vicariously liable under Section 141 of the Negotiable Instruments Act, 1881 in the absence of specific averments in the complaint showing that he was in charge of and responsible for the conduct of the company's business at the relevant time.

Analysis: Vicarious liability under Section 141 is penal in nature and must be strictly construed. The complaint must contain clear and unambiguous averments as to how the director was in charge of and responsible for the conduct of the business of the company at the time of the offence. Mere designation as a director is insufficient. Where the accused is a non-executive or Independent Director, liability cannot be fastened unless the complaint specifically alleges direct involvement in the company's business or in the transaction in question. On the pleadings here, the complaints made only general assertions that the petitioner was responsible for day-to-day management, while the record showed that he was an Independent Director, was not a cheque signatory, and had no specific role pleaded in the impugned transactions.

Conclusion: The petitioner could not be prosecuted with the aid of Section 141 of the Negotiable Instruments Act, 1881, and the summoning orders and consequent criminal proceedings were liable to be quashed qua him.

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