Specific Averments Regarding Day-to-Day Control Essential to Fasten Vicarious Liability on Directors Under Section 141 NI Act

The respondent, M/s. 63Ideas Infolabs Pvt. Ltd., entered into a sale and purchase agreement with Accused No. 1 (OSIA Hyper Retail Limited) for the supply of agricultural produce

Following the delivery of goods, cheques were issued toward discharge of liability but were subsequently dishonored for "insufficient funds"

Consequently, the respondent filed private complaints under Section 138 of the Negotiable Instruments Act, 1881 (‘the Act’). The petitioners, Dhirendra Chopra (Managing Director) and Kavitha Chopra (Director), were arrayed as accused

Kavitha Chopra (Wife) challenged her prosecution on the grounds that she was a non-signatory to most cheques and not involved in day-to-day affairs

Dhirendra Chopra (Husband) challenged his prosecution contending insufficient averments regarding his role

1. Whether a Director can be prosecuted under Section 138 r/w 141 of the Act in the absence of specific averments regarding their role in the day-to-day conduct of the company's business

2. Whether a joint account holder who is not a signatory to the cheque in question can be held liable under Section 138 of the Act

The court primarily applied Sections 138 and 141 of the Negotiable Instruments Act, 1881 regarding vicarious liability of corporate officers

It relied on SMS Pharmaceuticals Ltd. v. Neeta Bhalla, which established that specific averments are necessary to prove a Director was "in-charge of and responsible for" the business at the time of the offence

The court further cited Susela Padmavathy Amma v. Bharti Airtel Ltd. and S.P. Mani & Mohan Dairy v. Snehalatha Elangovan, clarifying that while "parroting" statutory language is not mandatory, the substance of the complaint must demonstrate the Director's active role.

Finally, it applied Aparna A. Shah v. Sheth Developers (P) Ltd., which mandates that only a signatory to a cheque from a joint account can be prosecuted under Section 138

The Court observed that the complaints and sworn statements were "blurring" and lacked specific details regarding the role of Kavitha Chopra

While she was a Director and a guarantor in the agreement, she was not the Managing Director, nor was there evidence that she was involved in the day-to-day financial operations

Applying the "twin requirements" of Section 141, the Court found that merely being a Director is insufficient to fasten vicarious liability without a clear nexus to the transaction

Regarding Criminal Petition No. 2797/2026 involving a joint account, the Court followed the Aparna A. Shah precedent, holding that Kavitha Chopra could not be prosecuted because she was not the signatory, despite being an account holder

Conversely, Dhirendra Chopra, as the Managing Director, is legally presumed to be in charge of the company’s affairs, and as the signatory in several instances, he is required to face trial to discharge the burden of his role

The Court allowed the petitions (Nos. 1978, 2041, 2091 of 2026) filed by Kavitha Chopra, quashing the proceedings against her in C.C. Nos. 13525/2025, 13260/2025, and 13527/2025. The Court dismissed the petitions (Nos. 2797 and 2854 of 2026) filed by Dhirendra Chopra, holding that as Managing Director and signatory, his liability is a matter for trial