Ex-director not liable for company cheque bounce; resignation before offense absolves vicarious liability u/s 141.

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....Interpretation of Section 141 of the Negotiable Instruments Act, which deals with vicarious liability for offenses committed by companies u/s 138 (dishonor of cheques). The key points are: Section 141 is a penal provision that must be strictly construed. Liability under this section depends on the role played by the person in the company's affairs, not merely their designation. To attract liability, the person must have been in charge of and responsible for the company's conduct at the time of the offense's commission. Merely being a director or having some association with the company is insufficient. The complaint must specify the accused's role and how they were responsible for the company's conduct. In this case, the petitioner had resi.........