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As per case facts, Indiabulls Housing Finance Ltd. (respondent) filed a complaint against Samruddhi Realty Ltd. and its directors after a loan repayment cheque was dishonoured. The trial court summoned
...the petitioner, Ramanand Pulavarti, as a director. The petitioner, a Nominee Director, appealed to the High Court, contending he was a Non-Executive Director with no role in the company's day-to-day operations or financial decisions, and his employer's agreement explicitly excluded him from such liability. The question arose whether a Nominee, Non-Executive Director without specific allegations of direct involvement in the company's affairs can be held vicariously liable under Section 141 of the Negotiable Instruments Act. Finally, the High Court, referencing judicial precedents, ruled that mere directorship is insufficient for liability. Given the petitioner's non-executive role and the absence of specific averments linking him to the company's financial conduct or the dishonoured cheque, proceeding against him would be an abuse of legal process. The complaint and summoning order against him were quashed.
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