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Vicarious liability of a company director for cheque dishonour...

Vicarious liability for cheque dishonour requires specific allegations of responsibility and cheque signatory; generic director allegations cannot sustain prosecution.

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Indian Laws August 28, 2026 Case Laws HC
Vicarious liability of a company director for cheque dishonour requires a complaint to specifically aver that the director was both in charge of, and responsible to, the company for conducting its business when the offence occurred. Mere directorship or a general allegation that all directors managed day-to-day affairs is insufficient. The complaint must also disclose the identity of the person who drew or signed the cheque. As no individual role was attributed to the director and no cheque signatory was identified, continuation of the prosecution was treated as an abuse of process and the cheque-dishonour proceeding was quashed against that director.

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Acts Income Tax