Mr. Counsel for the respondents, respondent Nos. 1, 2 and 4 have signed antecedent documents — the MoU, the cheque, and promissory notes. Does that not constitute foundational material linking them to the transaction?

My Lord, signing an antecedent document does not automatically make a person liable under Section 141 of the NI Act. The question is whether they were in charge of and responsible for the conduct of the business of the Society at the time the offence was committed — that is, at the time the cheque was issued. The cheque was issued on 18 November 2019. The MoU was signed on 31 July 2018 — over a year earlier. The promissory notes were executed between 2 July 2018 and 27 July 2018 — again over a year earlier. Signing a document a year before the offence does not establish that the signatory was in charge of the Society's affairs at the time of the offence. The complaint does not contain any specific averment about their role at the relevant time. Therefore, the complaint is still deficient.

The cheque bears the signature of respondent No. 2 as the Treasurer. Does that not make her a signatory?

My Lord, the cheque bears the signature of the second accused (M. Subramaniam – President), not respondent No. 2. The judgment summary indicates that the cheque was signed by the second accused. Respondent No. 2 (M. Rekah – Treasurer) is not a signatory to the cheque. The complaint may have alleged that respondent No. 2 signed some antecedent documents, but she did not sign the dishonoured cheque. For vicarious liability under Section 141, the accused need not sign the cheque, but the complaint must still contain specific averments about their role in the conduct of the Society's affairs at the time of the offence. That is absent.

The Supreme Court in this judgment has restored proceedings against respondent Nos. 1, 2 and 4. How do you respond to that?

My Lord, with respect, the Supreme Court has held that the complaint discloses sufficient foundational material against respondent Nos. 1, 2 and 4. The respondents accept the judgment of this Court and will face trial. However, the respondents maintain that the correct legal position is that specific averments are required. The Court has drawn a distinction based on the signing of antecedent documents. The respondents will abide by the judgment.

Respondent No. 3 has been quashed. Do you have any submissions on that?

My Lord, the respondents accept the judgment of this Court upholding the quashing of proceedings against respondent No. 3. That is correct because he did not sign any document and there are no specific allegations against him. The respondents submit that the same reasoning should have been applied to all respondents because none of them signed the dishonoured cheque. However, the Court has drawn a distinction based on the signing of antecedent documents. The respondents will abide by the judgment.

For RespondentCriminal Premium

Omnibus Averments Insufficient to Attract Vicarious Liability — (2026) INSC 542

The complaint contains only omnibus and generalised averments that the respondents were 'in charge of and responsible for the conduct of the business' without specifying their individual roles.

M/s Mansi Finance (Chennai) Ltd. v. M. Lalitha — (2026) INSC 542

Core Argument

The complaint contains only omnibus and generalised averments that the respondents were 'in charge of and responsible for the conduct of the business' without specifying their individual roles. Mere designation as office bearers is insufficient to attract vicarious liability under Section 141 of the NI Act. The High Court correctly quashed the proceedings.

Key Precedents

S.M.S. Pharmaceuticals Ltd. v. Neeta Bhalla (2005) 8 SCC 89 — Held that the complaint must contain specific averments that the accused was in charge of and responsible for the conduct of the business of the company; mere designation as director is insufficient.
National Small Industries Corporation Ltd. v. Harmeet Singh Paintal (2010) 3 SCC 330 — Held that the complaint must spell out how and in what manner the accused was in charge of or responsible to the company for the conduct of its business.
Ashok Shewakramani v. State of Andhra Pradesh (2023) 8 SCC 473 — Quashed proceedings where the complaint contained only a reproduction of statutory requirements without disclosing factual nexus between the accused and the transaction.

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