Dishonour of Cheque -- Partnership Firm--Non-Signatory Partner Liable for Dishonoured Cheques Where Underlying Liability Was Accepted During Period of Partnership Despite Subsequent Retirement
Under Section 141 of the Negotiable Instruments Act, liability of a partner of a firm for dishonour of a cheque is joint and several, not vicarious. Unlike a company director, a partner's liability is personal and direct, as a partnership firm is merely a compendious name for its partners. A partner who was part of the firm on the date of acceptance of the underlying liability remains jointly and severally liable, even if the cheques were issued after retirement. Retirement from a firm does not discharge a partner from pre-existing liabilities unless compliance with Sections 32(2) and 72 of the Indian Partnership Act is established through evidence at trial. A retirement deed is not unimpeachable evidence sufficient to quash summoning at threshold.
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