Case Law Analysis
|Bombay High Court
Section 138 NI Act | Cheque for 'Other Liability' Triggers Criminal Liability Even Without Direct Debt-Privity : Bombay HC Expands Scope
Bombay High Court rules that a cheque issued for 'other liability' under Section 138 of the Negotiable Instruments Act attracts criminal penalty regardless of a direct debtor-creditor relationship. The judgment rejects narrow interpretations, holding that vicarious liability extends to cheques issued pursuant to consent awards or family settlements, impacting directors and signatories of companies.