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Quashing of summoning order

2 articlesLatest July 2026
Section 138 NI Act | Directors Not Vicariously Liable Without Active Role in Cheque Issuance : Punjab & Haryana HC
Case Law Analysis
|Punjab and Haryana High Court

Section 138 NI Act | Directors Not Vicariously Liable Without Active Role in Cheque Issuance : Punjab & Haryana HC

Punjab & Haryana High Court rules that directors cannot be held liable under Section 138 of the Negotiable Instruments Act merely by virtue of their position. Liability attaches only if they were actively involved in the company's affairs or the cheque's issuance, and resignation before the cheque date absolves them entirely. This clarifies the scope of vicarious liability for directors in cheque bounce cases.