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| Person can't be prosecuted on basis of status in firm: Supreme Court | | | New Delhi| Jan 18
A person cannot be prosecuted merely because he or she is the
director of a company involved in litigation, the Supreme Court has ruled in a case
related to the bouncing of a cheque.
The liablity depends on the role one plays in the affairs of a company and not on the
designation or status of the person charged, a bench comprising Justices S B Sinha
and Markandeya Katju said while upholding an appeal filed by one Suresh Kumar
Poddar.
Poddar, one of the directors of VHEL Industries Limited, had challenged the Delhi
High Court's contention that he was liable for prosecution despite his having
resigned from the company before issuance of the cheque that bounced.
He said the cheque was signed by two other employees, K K Pilania and N K Munjal,
but he was being implicated in the matter on account of having been a director of the
firm when the cheque was issued.
The High Court, while rejecting his argument, had reasoned that Poddar was liable
for prosecution as the post- dated cheque was issued on May 10, 1997, whereas he
resigned from the company only on June 19, 1997
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