Wife Not Liable U/S 138 NI Act For Cheque Drawn By Husband From Joint Account: Punjab & Haryana HC
The Punjab and Haryana High Court observed that the wife cannot be held liable under Section 138 of the Negotiable Instruments Act for a cheque drawn by her husband from their joint account.
The Court, while quashing criminal proceedings against the Wife, noted that the provision only applies to the drawer of a cheque who fails to make payment after the cheque is dishonoured.
“In view of the above discussion, it would be safe to observe that the petitioner is not liable for the cheque drawn by her husband from the joint account relating to both of them”, the Bench of Justice NS Shekhawat observed.
Advocate Karan Suneja appeared for the Petitioners and Advocate RK Chaudhary appeared for the Respondent.
The Petitioner filed a petition under Section 482 of the Code of Criminal Procedure, 1973 (CrPC) seeking to quash the criminal proceedings under Section 138 of the NI Act.
The Petitioner's husband had issued a cheque for Rs. 5,00,000/- which was dishonoured due to insufficient funds. The Respondent, the payee of the cheque, filed a complaint under Section 138 of the NI Act. The Petitioner contended that she could not be prosecuted under Section 138 of the Act as she was not the drawer of the cheque and did not sign it.
The Court noted that Section 138 of the NI Act, only applies to the drawer of a cheque who fails to make payment after the cheque is dishonoured. In this case, the Petitioner was not the drawer of the cheque, and therefore, she cannot be prosecuted under Section 138.
The Court observed, “Section 138 of the Act refers to the payee or holder in due course of the cheque. It indicates that after the dishonour of the cheque, the drawer of the same could be brought to the dock for the fault committed by him”.
Furthermore, the Bench noted that the fact that the Petitioner is the spouse of the co-accused is not sufficient to make her liable for the offence. The only exception to this rule is when the drawer of the cheque is a company, in which case the person in charge of the company and the company itself can be held liable.
“However, there is exception to this and in case the person, who committed the offence under Section 138 of the Act, is a Company, then the person incharge of the Company as well as the Company itself shall be deemed guilty of the offence as provided under Section 141 of the Act”, the Bench noted.
Additionally, the Court relied on the case of Aparna A Shah v M/s Sheth Developers P. Ltd. And another, [2013 (8) SCC 71] and noted that Petitioner is not liable for the cheque drawn by her husband from the joint account relating to both of them. However, the Court held that the proceedings may continue against her husband, as he had signed the cheque in question.
Accordingly, the Court accepted the Petition and quashed the criminal proceedings against Petitioner.
Cause Title: Shalu Arora v Tanu Bathla (2023:PHHC:152038)
