#Vicarious liability under NI Act

Himachal Pradesh High Court rules that authorised signatories of cooperative societies are vicariously liable under Section 138 of the Negotiable Instruments Act for dishonoured cheques. The judgment clarifies that cooperative societies fall within the ambit of Section 141 NI Act, impacting all such entities and their office-bearers in cheque bounce cases.

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.