Cheque Dishonour | Wife Not Signatory, Cannot Be Held Liable For Cheque Signed & Given By Husband From Joint Account: Bombay High Court
The Bombay High Court recently quashed and set aside process and summons issued to a woman by the Magistrate's court in a cheque bounce case, noting that only her husband was a signatory to the cheque.Justice Sarang Kotwal quoted the judgement of the Supreme Court in Aparna A. Shah vs M/S. Sheth Developers Pvt. Ltd. “We also hold that Under Section 138 of the N.I. Act, in case of issuance...
The Bombay High Court recently quashed and set aside process and summons issued to a woman by the Magistrate's court in a cheque bounce case, noting that only her husband was a signatory to the cheque.
Justice Sarang Kotwal quoted the judgement of the Supreme Court in Aparna A. Shah vs M/S. Sheth Developers Pvt. Ltd.
“We also hold that Under Section 138 of the N.I. Act, in case of issuance of cheque from joint accounts, a joint account holder cannot be prosecuted unless the cheque has been signed by each and every person who is a joint account holder,” he held.
The woman approached the High Court after the Magistrate issued process against her and her husband on November 27, 2019 u/s 138 of the Negotiable Instruments Act for dishonour of cheque.
The complainant alleged that both husband and wife had jointly approached him in June 2018, for financial help. He gave them twelve lakhs in the form of two cheques. The applicant's husband had also issued a receipt for the Rs. 12 lakh loan. The complainant claimed the wife was aware of this.
After repaying Rs. 3 lakhs, it was submitted that the husband issued three cheques for the remaining Rs. 9 lakh from the couple's joint account. However, when the complainant deposited the cheques with his bank they were dishonoured.
It was argued that the wife was looking after the day-to-day affairs of the husband and therefore even she was responsible for her husband's act, since she was conversant with the facts, and had knowledge of the same.
Advocate Tariq Khan for the wife cited Aparna Shah's judgement and said since the woman wasn't a signatory to the cheque she couldn't be prosecuted.
Justice Kotwal observed that it wasn't even the complaint's case that the wife had also signed the cheque.
“She is roped in, by making the averment that the Applicant (wife) was looking after day-to-day affairs of her husband and therefore she was also responsible for the act committed by her husband…The learned Magistrate has observed in the impugned order that both the accused are signatories of the disputed cheque. This is factually incorrect,” the court said.
After reproducing observations from Aparna Shah's judgement, the court quashed the issuance of process against the wife.
“These observations (of the SC), in the factual matrix of the present case, are squarely applicable in favour of the Applicant. Therefore, the prosecution cannot stand against the present Applicant and hence the impugned order is liable to be set aside as far as the present Applicant is concerned,” the court said.
Case No- CRIMINAL APPLICATION NO.747 OF 2023
Case title - Aarti Shailesh Shah vs Satish Vasant Dharukkar & Anr.