K. SRIKANTH SINGH vs M/S. NORTH EAST SECURITIES LTD.

The Supreme Court held that under Section 138 of the Negotiable Instruments Act, a director can be held vicariously liable only if they are responsible for the company's day-to-day affairs as per Section 141 of the Act. The Court found that the allegations in the complaint established a prima facie case against the directors, including the appellant, as they participated in negotiations for financial assistance. The Court upheld the High Court's decision to not quash the proceedings against the appellant, emphasizing that the question of his directorship at the time of cheque issuance is a matter for the trial court to determine.