Omitting the partnership firm does not defeat a Section 138 complaint against its partners.

The respondent filed a complaint under Section 138 of the Negotiable Instruments Act, 1881 (“NI Act”), alleging that the petitioner had borrowed ₹3,00,000 for “M/s. Fusion Design and Build” and issued a cheque for that amount, which was dishonoured. After service of statutory notice, the respondent initiated proceedings, which were pending as C.C. No. 523/2018.

The petitioner applied under Section 141 of the NI Act, arguing that the cheque had been issued on behalf of a partnership firm and that the complaint was not maintainable because the firm had not been impleaded. The Magistrate declined to terminate the proceedings, noting that the petitioner had not produced material establishing that the concern was a partnership firm.

The petitioner challenged that order and sought, among other relief, quashing of the complaint.

1. Whether a complaint under Section 138 of the NI Act is not maintainable solely because the alleged partnership firm has not been separately arrayed as an accused.

2. Whether the Supreme Court’s subsequent decision in “Dhanasingh Prabhu v. Chandrasekar & Anr.” applied to the petitioner’s pending proceedings, although the Magistrate’s order preceded that decision.

The Court considered Sections 138 and 141 of the NI Act and the Supreme Court’s ruling in “Dhanasingh Prabhu v. Chandrasekar & Anr.”, SLP (Criminal) No. 5706 of 2024, dated 14 July 2025.

As quoted by the Court, “Dhanasingh Prabhu” held that a complaint may remain maintainable despite the firm not being separately named as an accused where its partners are proceeded against, given the stated joint and several liability of the partners and firm.

The Court further treated that ruling as a declaration of the law governing the existing statutory scheme, applicable to pending proceedings absent an express prospective limitation.

The petitioner relied on the cheque’s indication that it was signed for “M/s. Fusion Design and Build” by a partner, and argued that the firm’s omission was fatal to the complaint.

Applying “Dhanasingh Prabhu”, the Court held that non-impleadment of the firm, by itself, did not make the complaint unmaintainable. The petitioner’s objection therefore could not justify termination of the proceedings at that stage.

Questions concerning the concern’s status, the petitioner’s capacity in issuing the cheque, and the extent of his liability were left for consideration on the evidence before the Trial Court.

The later date of the Supreme Court ruling did not prevent its application to the pending petition, since the ruling declared the governing legal position and did not impose a prospective limitation.

The petition was dismissed, the Magistrate’s order was left undisturbed, and the petitioner remained at liberty to raise other factual and legal contentions before the Trial Court.