Resignation Plea No Ground to Quash Cheque Case: SC

Mere Plea of Resignation No Ground to Quash Cheque Case Against Director Who Signed the Cheque: Supreme Court

Bhatana Alloys Private Limited v. Kuljinder Singh etc. Decided 5 November 2026

Published: 12 November 2026 · NyayVidhan · 3 min read

In Bhatana Alloys Private Limited v. Kuljinder Singh (Criminal Appeal Nos. 5271-5273 of 2026), the Supreme Court held that a director's assertion that he resigned before the cheque was dishonoured was not, by itself, a sufficient basis to quash a Section 138 NI Act complaint when he had admittedly signed the cheque while still a director (para 19). It set aside the High Court's quashing of the summoning order against him (para 24) and dismissed the connected petition of Yadvinder Singh.

Key holdings

The High Court's order of 15.02.2025 is set aside only so far as it quashed the summoning order of 21.03.2015; the Trial Court is to proceed (para 24).

An undisputed signature on the cheque is a specific and material circumstance, beyond mere designation or a general averment (para 19).

A plea of resignation before the dishonour does not, by itself, justify quashing under Section 482 without unimpeachable and incontrovertible material (paras 19-20).

Questions of issuance, resignation, dishonour and liability are left to trial, where the accused may establish his defence (paras 21-23).

The connected SLP (Crl.) No. 8747/2025 of Yadvinder Singh was dismissed in the record of proceedings.

Judgment digest by NyayVidhan: a summary of the court's judgment, not its text. The judgment itself is the authoritative version.

Brief Facts

The appellant company filed a private complaint under Section 138 of the NI Act before the Chief Metropolitan Magistrate, Chandigarh, over a post-dated cheque for Rs.14,00,000/- dated 15.04.2014, issued in a business transaction for iron and steel goods, returned with the endorsement ‘Account Closed’ (paras 5-7). Process issued only against the accused company and its director Kuljinder Singh, who signed the cheque (paras 7, 9). In CRM-M-27027/2016 he told the Punjab & Haryana High Court he had resigned as director on 25.06.2012 (para 10). On 15.02.2025 the High Court quashed the summoning order of 21.03.2015 against him, and remanded the question of the liability of Yadvinder Singh and of a deceased co-accused to the Trial Court (para 11).

Court's Findings

The Court disagreed with the High Court's line of reasoning (para 17). The High Court had itself proceeded on the footing that Kuljinder Singh signed the cheque as Director and Authorised Signatory, a fact he did not dispute (paras 15-16). Applying the principles in S.P. Mani & Mohan Dairy v. Snehalatha Elangovan, the Court said his involvement was not founded merely on his designation or a general averment: his undisputed signature was a ‘specific and material circumstance’ (paras 18-19). An assertion that he resigned before the dishonour was not, by itself, a sufficient basis for quashing, particularly as he signed the cheque during the subsistence of his directorship (para 19). Under S.P. Mani, the High Court may exercise its Section 482 jurisdiction only if the accused places ‘unimpeachable and incontrovertible material’ showing he could not have been concerned with the issuance of the cheque; the High Court found no such material (para 20). Issuance, resignation, dishonour and liability are questions for trial, where he remains at liberty to establish his defence (paras 21-23).

Legal Principle

Where a director signed the dishonoured cheque on the company's behalf while in office, his assertion that he resigned before the dishonour is not, by itself, a ground to quash a Section 138 NI Act complaint under Section 482 CrPC; without unimpeachable and incontrovertible material, the resignation and his liability are for trial (paras 19-23).

NyayVidhan's view · Practice note

Why It Matters

For complainants and company directors in cheque cases, this order limits a common threshold defence. A director whose signature on the cheque is undisputed will not, on a bare plea that he resigned before the dishonour, get the complaint quashed under Section 482; he needs unimpeachable and incontrovertible material, and otherwise resignation is a question of evidence at trial (paras 19-23). The order decides neither whether he resigned nor whether he is liable (para 21). For an earlier ruling on vicarious liability and quashing, see the Rajasthan High Court in Yogendra Durlabhji v. State of Rajasthan.

Editorial comment by the NyayVidhan Editorial Desk. It is not part of the Court's judgment and is not legal advice.

Precedents Relied Upon

S.P. Mani & Mohan Dairy v. Snehalatha Elangovan (2023) 10 SCC 685
Applied Discussed at ¶ 18, 20
Applied its principles: Section 482 jurisdiction to quash a cheque-dishonour complaint against a director is to be exercised only if the accused places unimpeachable and incontrovertible material showing he could not have been concerned with the issuance of the cheque; the undisputed signature of the director on the cheque attracted those principles, so his plea of resignation alone did not justify quashing.