THE ORIOL INDUSTRIES LTD. vs THE BOMBAY MERCANTILE BANK LTD.

The Supreme Court held that Section 89 of the Indian Companies Act, 1913, requires that a negotiable instrument must explicitly show it was drawn by the company or by a person acting on its behalf. The Court affirmed the appellate court's decision that the bank acted in good faith in honoring cheques drawn by the Managing Agents without proper identification, thus the company could not recover the amounts. The appeal was dismissed, reinforcing the principle that the resolution's purpose was to comply with Section 89 and did not impose additional conditions.