Sankar Padam Thapa Vs Vijaykumar Dineshchandra Agarwal (Supreme Court of India)
Trust not a juristic person – cheque-bounce case maintainable against Trustee who signed the cheque –
Cheque bounced from Trust account? Supreme Court says signatory Trustee can be prosecuted even without arraigning the Trust
Core Issue
Whether a complaint under Section 138 of the Negotiable Instruments Act (NI Act) is maintainable against the Chairman/Trustee of a Trust when the Trust itself is not made an accused, though the cheque was issued on behalf of the Trust.
Background Facts
William Carey University, managed by Agriculture Crafts Trades & Studies (ACTS) Group, faced financial crisis. Management was handed over to Orion Education Trust (Respondent was its Chairman) via MoU dated 12.10.2017. For liaison work, Appellant was engaged & later issued a cheque for ₹5 crore dated 13.10.2018 drawn on Kotak Mahindra Bank. Cheque was dishonoured for “insufficient funds.” Appellant filed complaint u/s 138, 142 NI Act & s.420 IPC. The High Court of Meghalaya quashed proceedings on the ground that the Trust (Orion) – a necessary party – was not made an accused.
Appellant’s Arguments
- A Trust is not a juristic person & cannot be sued; only Trustees can sue or be sued.
- Relied on:
Pratibha Pratisthan v. Manager, Canara Bank (2017) 3 SCC 712 – Trust not a “person” under Consumer Protection Act.
