Cheque dishonour liability excludes non-signatory family members of sole proprietorships without a legally recognised basis for vicarious liability.

Section 141 of the Negotiable Instruments Act does not extend vicarious criminal liability to family members of a sole proprietorship, which has no separate legal identity or recognised business structure comparable to a company, firm or association. Liability for cheque dishonour under Section 138 is confined to the account-holding drawer unless valid vicarious liability applies; a non-signatory family member who neither maintained nor signed on the account cannot be prosecuted, particularly where the account holder had died and the banking mandate was inoperative. The High Court's inherent jurisdiction may quash a prosecution that lacks essential statutory ingredients and is ex-facie an abuse of process.

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Issues: (i) Whether vicarious liability under Section 141 of the Negotiable Instruments Act, 1881 extends to a family member of a sole proprietorship concern; (ii) Whether a non-signatory may be prosecuted under Section 138 of the Negotiable Instruments Act, 1881 for cheques drawn on an account of a deceased person; (iii) Whether inherent jurisdiction may be exercised to quash an ex-facie groundless prosecution notwithstanding the Magistrate's inability to recall process.

Issue (i): Whether vicarious liability under Section 141 of the Negotiable Instruments Act, 1881 extends to a family member of a sole proprietorship concern.

Analysis: Section 141 creates an exceptional statutory form of vicarious criminal liability applicable to a company, partnership firm, or association of individuals. A sole proprietorship has no legal identity distinct from its proprietor and falls outside that statutory framework. Domestic or familial proximity cannot substitute for a partnership deed or other legally recognised business structure.

Conclusion: Section 141 does not apply to a sole proprietorship concern, and its family members cannot be made vicariously liable merely because of their familial relationship. The issue is decided in favour of the petitioner.

Issue (ii): Whether a non-signatory may be prosecuted under Section 138 of the Negotiable Instruments Act, 1881 for cheques drawn on an account of a deceased person.

Analysis: Liability under Section 138 is confined to the drawer maintaining the account on which the cheque is drawn, unless valid vicarious liability under Section 141 is attracted. The petitioner neither signed the cheques nor maintained the account. The account holder had died before the dates of the cheques, and the banking mandate stood revoked upon death under Section 201 of the Indian Contract Act, 1872. Any alleged deception involving pre-signed cheques may attract remedies under general penal law but cannot satisfy the statutory ingredients of the cheque-dishonour offence against a non-signatory.

Conclusion: The petitioner, being a non-signatory who did not maintain the account, could not be prosecuted under Section 138; the death of the account holder rendered the banking mandate inoperative. The issue is decided in favour of the petitioner.

Issue (iii): Whether inherent jurisdiction may be exercised to quash an ex-facie groundless prosecution notwithstanding the Magistrate's inability to recall process.

Analysis: Restrictions on a Magistrate's power to recall process in a summary summons case do not limit the High Court's inherent jurisdiction under Section 482 of the Code of Criminal Procedure, 1973. Where the complaint lacks essential statutory ingredients and public records disclose a complete legal vacuum, continuation of prosecution constitutes abuse of process.

Conclusion: Inherent jurisdiction could be exercised to quash the prosecution against the petitioner as ex-facie groundless. The issue is decided in favour of the petitioner.

Final Conclusion: The statutory foundations for fastening cheque-dishonour liability upon the petitioner were absent, and continuation of the prosecution against him would amount to abuse of process.

Ratio Decidendi: A non-signatory family member of a sole proprietorship cannot be prosecuted for cheque dishonour under Sections 138 and 141 where he neither maintains the account nor falls within a legally recognised basis for vicarious liability; inherent jurisdiction may be invoked to prevent such an ex-facie untenable prosecution.

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