S who was director of R & D Company, issued a cheque in favour of G Associates for the discharge of its debt. The cheque was returned by the bank unpaid because of the amount of money standing to the credit of that a

Section 141(1) of the Negotiable Instruments Act, 1881 (Act), deals with offences by companies. It states that if the person committing an offence under Section 138 is a company, every person who, at the time the offence was committed, was in charge of, and was responsible to, the company for the conduct of its business, as well as the company itself, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly. Provisos to Section 141(1): A person shall not be liable to punishment if they prove that the offence was committed without their knowledge, or that they had exercised all due diligence to prevent the commission of such offence. A person nominated as a Director by virtue of holding an office or employment in the Central Government or State Government or a financial corporation owned or controlled by them, shall not be liable for prosecution under Chapter XVII. Section 141(2) further states that if an offence by a company is proved to have been committed with the consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or other officer of the company, such person shall also be deemed guilty and liable to be punished. In the given situation: S, a director of R & D Company, issued a cheque for the discharge of the company's debt. The cheque was dishonoured due to insufficient funds. Since S, as a director, issued the cheque for the company's debt, and the cheque was dishonoured, S would be deemed to be guilty of the offence under Section 138 of the Act, in conjunction with Section 141, and shall be liable to be proceeded against and punished accordingly, unless he can prove otherwise as per the provisos. Conclusion: Yes, S is liable under Section 141 of the Negotiable Instruments Act, 1881, as he was a director and issued the cheque for the company's debt, which was subsequently dishonoured.