New Delhi, April 22 (PTI): The Supreme Court has ruled that senior officials of a firm, such as chairpersons, managing directors and directors, can be held liable for criminal prosecution if a cheque issued by their company bounces.

The officials will have to prove that they were not in charge of the company when the cheque was issued, a bench of justices comprising Tarun Chatterjee and P.K. Balasubramanyam said while upholding an appeal filed by BSNL.

Moreover, the accused can adopt such a defence only at the time of the trial but not during the registration of the case, the apex court said.

The bench gave its ruling while dealing with an appeal filed by N. Rangachari, chairman and managing director of Data Access (India) Ltd, challenging a criminal case against him by BSNL after two cheques issued by the company were dishonoured by a bank.

Rangachari argued that no criminal case could be registered against him as he was only the honorary CMD without any power to sign cheques. He also claimed that he had resigned from the firm on August 26, 2004, four days before the cheques were issued. However, interpreting sections 138 and 141 of the negotiable instruments act, the apex court said it was enough for the complainant to have a fair belief that a particular officer was in charge of the company when the cheque was issued.