Sankar Padam Thapa v. Vijaykumar Dineshchandra Agarwal 2025 INSC 1210 - S.138 NI Act - Trustees
Negotiable Instruments Act 1881 - Section 138 - When a cause of action arises due to an alleged dishonour of cheque and a complaint is initiated under the NI Act, the same is maintainable against the Trustee who has signed the cheque, without the requirement to array the Trust also as an accused. (Para 29)
Trust -A Trust is not a ‘legal entity’ or ‘juristic person’. A Trust is also not like a corporation which has a legal existence of its own and therefore can appoint an agent. A Trust operates through its Trustees, who are legal entities. (Para 25) Though a Trust may act or even be treated as an entity for certain legal purposes and not all legal purposes, a Trust is an obligation imposed on the ostensible owner of the property to use the same for a particular object - for the benefit of a named beneficiary or charity, and it is the Trustee(s) who are bound to maintain and defend all suits and to take such other steps with regard to the nature, land or the value of the Trust property, that may be reasonably required for the preservation of the Trust property, and the assertion of protection of title thereto, subject to the provisions of the instructions of Trust to take such other steps. (Para 26)
Precedents - For questions of law, in the case of a conflict between equal Bench-strength judgments, the earlier view alone should be followed. (Para 44)
Case Info
- Case name: Sankar Padam Thapa v. Vijaykumar Dineshchandra Agarwal.
- Neutral citation: 2025 INSC 1210.
- Coram: Hon’ble Mr. Justice Ahsanuddin Amanullah; Hon’ble Mr. Justice Prashant Kumar Mishra.
- Judgment date: October 09, 2025.
Caselaws and Citations
- SMS Pharmaceuticals Ltd. v. Neeta Bhalla, (2005) 8 SCC 89.
- K.K. Ahuja v. V.K. Vora, (2009) 10 SCC 48.
- Sunita Palita v. Panchami Stone Quarry, (2022) 10 SCC 152.
- D. Purushotama Reddy v. K. Sateesh, (2008) 8 SCC 505.
- S P Mani and Mohan Dairy v. Dr Snehalatha Elangovan, (2023) 10 SCC 685.
- Pratibha Pratisthan v. Manager, Canara Bank, (2017) 3 SCC 712.
- Aneeta Hada v. Godfather Travels and Tours Pvt. Ltd., (2012) 5 SCC 661.
- Himanshu v. B. Shivamurthy, (2019) 3 SCC 797.
- Pawan Kumar Goel v. State of U.P., 2022 SCC OnLine SC 1598.
- National Small Industries Corporation Ltd. v. Harmeet Singh Paintal, (2010) 3 SCC 330.
- Aparna A Shah v. Sheth Developers Pvt. Ltd., (2013) 8 SCC 71.
- Union Territory of Ladakh v. J&K National Conference, 2023 SCC OnLine SC 1140.
- National Insurance Co. Ltd. v. Pranay Sethi, (2017) 16 SCC 680.
- A Raja v. D Kumar, 2025 SCC OnLine SC 1033.
- A P Electrical Equipment Corporation v. Tahsildar, 2025 SCC OnLine SC 447.
- Historical reference: Salomon v. A Salomon & Co. Ltd., [1897] AC 22.
- Tata Engineering and Locomotive Co. Ltd. v. State of Bihar, (1964) 34 Comp Cas 458.
High Court decisions discussed
- Kerala HC: K P Shibu v. State of Kerala, 2019 SCC OnLine Ker 7585.
- Kerala HC: Prana Educational & Charitable Trust v. State of Kerala, 2023 SCC OnLine Ker 8449.
- Delhi HC: Duli Chand v. MPTC Charitable Trust, 1983 SCC OnLine Del 270.
- Madras HC: V Chandrasekaran v. Venkatanaicker Trust, 2016 SCC OnLine Mad 33745; Narayana Iyer v. Anandammal Adheena Trust, (2021) 3 CTC 776; Abraham Memorial Educational Trust v. Suresh Babu, 2012 SCC OnLine Mad 2986.
- Gujarat HC: Kansara Abdulrehman Sadruddin v. Trustees of the Maniar Jamat Ahmedabad, AIR 1968 Guj 184.
- Calcutta HC: Vijay Sports Club v. State of Bengal, 2019 SCC OnLine Cal 2331.
- Karnataka HC: Chikkamuniyappa Memorial Trust v. State, ILR 1997 Kar 2460.
- Orissa HC: Bijaya Manjari Satpathy v. State of Orissa, 2022 SCC OnLine Ori 4092.
- Gauhati HC: Pranab Jyoti Dutta v. Chief Branch Manager, SBI, 2023 SCC OnLine Gau 243.
Statutes / Laws referred
- Negotiable Instruments Act, 1881: Sections 138, 141, 142.
- Indian Trusts Act, 1882: Sections 3, 13.
- Indian Penal Code, 1860: Section 420.
- Code of Criminal Procedure, 1973: Section 482.
- Consumer Protection Act, 1986: Section 2(1)(m).
- References to the Companies Act definitions via case law discussion.
Comments By Lawyers On This Judgment:
The fundamental requirement of the Act is that post-dishonour of the cheque, a demand notice must be issued to the drawer of the cheque. It is only upon the failure of the drawer (trust, here), the complaint lies against the drawer under S. 138 and trustee under S. 141. (2/n)
— Harshit Shukla (@Shuk_law_) October 9, 2025
The scheme of the Act is very clear and it is well settled that the penal provisions are to be construed strictly. It is not required to unnecessary delve into the issue of seperate entity which essentially falls under civil law. This is unnecessary interpretive exercise.
— Harshit Shukla (@Shuk_law_) October 9, 2025
End.