Rajesh Viren Shah vs Redington (India) Limited

The Supreme Court addressed the liability of directors under Section 138 of the Negotiable Instruments Act, 1881, in cases where they had resigned and their resignation was duly recorded as per Sections 303(2), 264(2), 266(1)(a), and 266(1)(b)(iii) of the Companies Act, 1956. The Court held that a director can only be held liable if they were responsible for the affairs of the company at the time of the offence, as per Section 141 of the N.I. Act. The appeals were dismissed, affirming that the appellants could not be held liable for the dishonoured cheques post-resignation without evidence of their involvement in the company's affairs at that time.