The Supreme Court has held that a cheque-dishonour complaint under Section 138 of the Negotiable Instruments Act is maintainable even when filed against a trustee, without explicitly making the trust itself an accused party. The decision clarifies that procedural technicalities should not defeat substantive rights where trustees bear responsibility in practice.
In delivering judgment, the Court observed that liability under Section 138 may attach to those who are in control or in charge of the business affairs connected with the cheque transaction, and that requiring the trust to always be impleaded could hamper enforcement. The ruling aligns with broader jurisprudence that priority must be given to substance over form in cheque dishonour proceedings.
However, the Court emphasized that while a trustee may be prosecuted directly, courts should ensure fairness and adherence to principles of natural justice—such as giving opportunity to respond—especially in cases involving entities with complex internal structures.
This judgment provides important clarity for litigants in situations where a trust or charitable body issues cheques, but the administrative control rests with specific individuals (trustees). It strengthens the enforceability of financial obligations and discourages shielded liability through structural formalities.
