High Court refuses to quash cheque bounce case against woman despite husband undertaking liability

The Punjab and Haryana High Court has refused to quash proceedings under Section 138 of the Negotiable Instruments Act against a woman accused alongside her husband in a cheque bounce case. Justice Alok Jain held that a Special Power of Attorney authorising her husband to act on her behalf could not be sidestepped merely because a settlement agreement said his company would pay the Rs 85 lakh liability.

The petitioner, proprietor of a firm, and her husband, a director of IQ Med Healthcare, had business dealings with the complainant. A one-time settlement recorded that the outstanding amount would be paid by the company on behalf of both firms. When the cheque was dishonoured, a complaint was filed and the magistrate summoned both. The petitioner argued she was not liable, pointing to the complainant's own averment that her husband had acknowledged responsibility for her firm's debt.

The court observed that the petitioner could not selectively claim the benefit of the settlement while disowning the liability it was meant to settle. It noted she remained an important party because the complainant would rely on business dealings with her to establish the debt. The court also noted she declined to demonstrate her bona fides by making any effort to discharge the liability. The petition was dismissed, leaving the disputed questions to be resolved at trial.