In Brief
National Housing Bank filed a complaint against a private company and six individuals (its managing director and five directors) for alleged violations under the National Housing Bank Act, 1987. The High Court quashed the complaint entirely, holding that essential legal averments required by Section 50(1) of the 1987 Act (pari materia with Section 141 of the Negotiable Instruments Act) were absent. The Supreme Court partly allowed the appeal, holding that while mere directorship does not attract liability, a managing director is automatically liable as being in charge of the company's business. The complaint against directors was quashed but allowed against the company and managing director.
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