S.138 of Negotiable Instruments Act, 1881 : Role of Authorized Signatory of Company Explained by Supreme Court
In an interesting judgment issue answered was whether authorized signatory of a company would be liable for prosecution under Section 138 of the Negotiable Instruments Act, 1881 without the company being arraigned as an accused. It was held that in the absence of the company being arraigned as an accused, a complaint against the Director of Company was therefore not maintainable. The Director of Company had signed the cheque as a Director of the company and for and on its behalf. Moreover, in the absence of a notice of demand being served on the company and without compliance with the proviso to Section 138, the High Court was in error in holding that the company could now be arraigned as an accused.
Himanshu v. B. Shivamurthy [2019] GCtR 6177 (SC)
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