TaxTMI 
TaxTMI 
2025 (6) TMI 1160
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....thers Vs. State of U.P.) whereby the revision preferred by the applicants herein in leading application against the summoning order dated 21.07.2023 has been dismissed. 2. A joint statement has been made by the learned counsel for the parties that they do not propose to file any additional affidavit and the application be decided on the basis of the documents available on record. With the consent of the parties, the applications are being decided at the fresh stage. 3. Broadly, the facts are that the opposite party no. 2, Rohit Agarwal, claims himself to be a partner of a firm by the name of M/s. Metal Products which is engaged in manufacturing and supplying of Bare/Insulated Copper and Aluminium Wire. According to the opposite party no. 2, it had supplied bare/insulated copper and Aluminium wire to M/s. Kotsons Pvt. Ltd. which is a company registered under the Companies Act. Allegation is that for the discharge of liability which had accrued on account of purchase of the bare/aluminium wire, four cheques bearing no. 598081, 598082, 598083 and 598084 dated 01.12.2022 of Rs. 50,00,000/- each was drawn on behalf of the company Kotsons Pvt. Ltd. by one of the Director, Siddharth....
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....S. Hariparvat Agra, District Agra, including cognizance order dated 21.7.2023. 3. Contention of learned counsel for the applicants is that the cheque in question was issued in favour of the partnership firm M/s Metal Products, but the impugned complaint has been filed by one of its partners without any authorization on behalf of the firm. It is further submitted by the Senior Counsel that the position of partnership firm is different from the proprietorship concerned as on bouncing of the cheque, issued in favour of the proprietorship concerned, its proprietor can file a complaint, but in the case of partnership firm, a complaint can be filed under Section 138 N.I. Act by the partnership firm through its partner and the partner can also file a complaint under Section 138 N.I. Act on bouncing of the cheque issued in favour of the partnership firm but there should be authorization on behalf of the firm. It is also submitted that the cheque in question was issued in favour of the firm, therefore, the firm is payee and the partner cannot be treated as the payee and he can be treated as the holder in due course only after authorization on behalf of the firm. In support of his c....
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....d that under Section 138 of the NI Act, it is only the payee or the holder in due course of the cheque who is competent to issue a statutory demand notice and to file complaint. 9. In a nutshell, it is submitted that the opposite party no. 2- complainant only being a partner of a partnership firm had no authority under law to have either issued demand notice or to have lodged complaint under Section 138 of the NI Act. Secondly, it has been submitted that even assuming without admitting the opposite party no. 2 as a partner of a partnership firm could have filed a complaint but there was no authorization of the partnership firm so as to authorize him to lodge proceedings under Section 138 of the NI Act. Thirdly, the bar contained under Sections 19 and 22 of the Indian Partnership Act, 1932 would come in the way of lodging criminal proceedings by a partner particularly when there was no implied authority so enjoined with the complainant as a partner to lodge proceedings. Fourthly, the bar of Section 14 of the Insolvency and Bankruptcy Code, 2016 would apply particularly when the company of which the applicants were the Directors was under monetarium regime vide order dated 09.06.2....
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....Nedungadi and others Vs. State of U.P. & others, Application u/s 482 No. 72 of 2020 decided on 13.10.2020 (Allahabad High Court), (12) Crl. O.P. No. 13147 of 2015 Madras High Court Rangabashyam Vs. V. Rajeshwari, (13) (2024) 6 SCC 143, Prem Raj Vs. Poonamma Menon and another, (14) Alchemist Asset Reconstruction Company Ltd. Vs. M/s. Hotel Gaudavan Pvt. Ltd.: (2018) 16 SCC 94. Argument of the counsel for the opposite party no. 2-complainant 12. Countering the submissions so made on behalf of the learned counsel for the applicants Ms. Shreya Gupta, learned counsel who appears for the opposite party no. 2-complainant has submitted that the order dated 21.07.2023 summoning the applicants under Section 138 of the NI Act as well as the order rejecting the revision does not suffer from any illegality and no interference is called for. Submission is that the complainant/opposite party had the competence and the authority to lodge criminal proceedings as he was one of the partners of the partnership firm and he being the agent of the firm had the right to lodge complaint. It is also submitted that even if it is assumed though not admitted that the complainant/opposite party no. 2 bein....
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.... Supreme (All) 1581, (8) Bhupesh Rathod vs. Dayashankar Prasad Chaurasia and another; (2022) 2 SCC 355, (9) M/s Samrat Shipping Company Pvt. Ltd. Vs. Dolly George J.T. 1999 (10) SC 381, (10) National Small Industries Corporation Ltd. Vs. State (NCT of Delhi) & etc. (2008) 16 S.C.R. 83, (11) Ashutosh Ashok Parasrampuriya and another Vs. Gharrkul Industries Pvt. Ltd. & others AIR 2021 SC 4898. Statutory provisions: Partnership Act, 1932 2. Definitions.-In this Act, unless there is anything repugnant in the subject or context,- (a) an"act of a firm" means any act or omission by all the partners, or by any partner or agent of the firm which gives rise to a right enforceable by or against the firm; 4. Definition of "partnership", "partner", "firm" and "firm name"-"Partnership" is the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all. Persons who have entered into partnership with one another are called individually "partners" and collectively "a firm", and the name under which their business is carried on is called the "firm name". 11. Determination of....
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....admit any liability in a suit or proceeding against the firm, (f) acquire immovable property on behalf of the firm, (h) transfer immovable property belonging to the firm, or (g) enter into partnership on behalf of the firm. 22. Mode of doing act to bind firm.-In order to bind a firm, an act or instrument done or executed by a partner or other person on behalf of the firm shall be done or executed in the firm name, or in any other manner expressing or implying an intention to bind the firm." Negotiable Instrument Act, 1881 "7. "Drawer" "Drawee".-The maker of a bill of exchange or cheque is called the "drawer"; the person thereby directed to pay is called the "drawee". "Drawee in case of need".- When in the Bill or in any indorsement thereon the name of any person is given in addition to the drawee to be resorted to in case of need such person is called a "drawee in case of need." "Acceptor".-After the drawee of a bill has signed his assent upon the bill, or, if there are more parts thereof than one, upon one of such parts, and delivered the same, or given notice of such signing to the holder or to some person on....
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....payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice; in writing, to the drawer of the cheque, [within thirty days] of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and (c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice. Explanation.-For the purposes of this section, "debt of other liability" means a legally enforceable debt or other liability. 141. Offences by companies.-(1) If the person committing an offence under section 138 is a company, every person who, at the time the offence was committed, was in charge of, and was responsible to, the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly: Provided that nothing contained in this sub-section shall render any person liable to punishment if he proves t....
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....e may be, maintains the account, is situated; or (b) if the cheque is presented for payment by the payee or holder in due course, otherwise through an account, the branch of the drawee bank where the drawer maintains the account, is situated. Explanation.-For the purposes of clause (a), where a cheque is delivered for collection at any branch of the bank of the payee or holder in due course, then, the cheque shall be deemed to have been delivered to the branch of the bank in which the payee or holder in due course, as the case may be, maintains the account." Analysis : 13. I have heard learned counsel for the parties and perused the record carefully. 14. Before embarking an inquiry upon the tenability of the arguments so made across the bar it would be apposite to discuss the import and impact of the various provisions of the Indian Partnership Act, 1932 and the law on the said subject. 15. To begin with Section 18 provides that the partner is the agent of the firm for the purposes of business of the firm. 16. Section 2(a) defines an act of the firm which means any act or omission by all the partners, or by any partner or agent of the firm which giv....
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....illai and others 1977 (1) SCC 431 the following was observed as under:- "17. The necessary inference from the premise that a partnership is only a collective of separate persons and not a legal person in itself leads to the further conclusion that the salary stipulated to be paid to a partner from the firm is in reality a mode of division of the firm's profits, no person being his own servant in law since a contract of service postulates two different persons." 20. In Munshi Ram Vs. Municipal Committee 1979 (3) SCC 83, it was observed as under.- 17. "Partnership" as defined in Section 4 of the Indian Partnership Act, 1932, is the relation between persons who have agreed to share the profits of a business carried on by all or any of them for the benefit of all. The section further makes it clear that a firm or partnership is not a legal entity separate and distinct from the partners. Firm is only a compendious description of the individuals who compose the firm. The crucial words in the definition of "partnership" are those that have been underlined. They hold the key to the question posed above. They show that the business is carried on by all or any of the....
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....eading of Section 22 with Section 19 of the Indian Partnership Act, would show that the firm would be bind by the act of the partner on the basis of implied authority. A close reading of the provisions do not in any manner indicate that there has to be an express authority at every stage and point of time with the partner to bind the firm, having been so the word "implied authority" would not have been employed in Section 19 and 22 of the Indian Partnership Act. It is a matter of common knowledge that there are two types of authorities express or implied. There is no difficulty in express authority and so far as the implied authority is concerned, it is to be proved. In some cases also, option is available with the partnership firm through other partners to ratify the action or conduct of the partner who had done an act in order to bind the firm. What is more important is the employing the word "in the firm's name or in any other manner expressing or implying an intention to bind the firm", which means that a partner can do an act in the name of firm or in any manner expressing or implying an intention to bind the firm. What is, thus, understandable is that a partner may do an act ....
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....ound by the trial court, was authorised to do business on behalf of the firm." 27. Thus, it can be very well said that a partner can do an act by himself in the capacity of a partner of a firm in the name of the firm or in any manner expressing or implying and it is always subject to ratification or implied authority by the other partners. 28. The objection of the learned Senior Counsel for the applicants is that complainant as a partner of a firm has no right to either issue statutory demand notice or to lodge criminal proceedings under Section 138 of the NI Act. Though, learned counsel for the opposite party no. 2 submits that the opposite party no. 2 being a partner has the full authority to lodge criminal proceedings. It is not in dispute that the opposite party no. 2-complainant is a partner of the partnership firm, Metal Products. Section 7 defines drawer and drawee according to which the maker of bill of exchange or a cheque is called the drawer and the person thereby directed to pay is called the drawee. So much so payee means the person named in the instrument to whom or whose order, the money is by the instrument directed to be paid. Section 8 defines holder, as the....
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....om the aforesaid observations made by the Apex Court, it is crystal clear that if the cheque is issued in the name of a firm, whether proprietorship or partnership firm, the proprietor or the partner as the case may be, becomes the holder in due course and he can suein his own name and it is not necessary for him to sue in a trading name, though others can sue such firm in the trading name. Therefore, the instant complaint filed by the opposite party no.2, claiming himself to be a proprietor of the said firm in whose name the said cheque is issued by the applicant herein, in the considered opinion of this Court, complaint is maintainable. Even if the contention of applicant be accepted that the said Raj Rajeshwari Enterprises is a partnership and not a proprietorship firm, it will not help the applicant herein as even the partnership firm does not have a different legal identity and is not a juristic person. Therefore, a partner of the firm also becomes the holder in due course of the cheque within the meaning of Section 142 (1) of the N.I. Act. Thus, the complaint even on behalf of the partner of a firm in his own name is maintainable. Otherwise, also in the instant case, the appl....
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....ard to judgment cited by learned Senior Counsel for the applicants, Sri Suresh Sharma (supra) is concerned, the said judgment would not also apply, particularly when it was the case wherein the complaint had been rejected post taking of cognizance. In the said case, the import and the impact of the provisions of Partnership Act have not been considered. However, in the present case, the stage at which challenge has been raised is of summoning. 38. Likewise, there is no quarrel to the proposition laid down in the case of P.K. Selvaraj (supra) & Sushil Kumar (supra) which mandates that a complaint is to be lodged by the payee or payee/holder or holder in due course. 39. So far as the other aspect of the matter that there was no authorization available with the complainant and the complaint ought to have been rejected at the stage of summoning, the said question dependents upon the nature of the defect whether it is curable or not that is curable or not. In M/s Samrat Shipping Company Pvt. Ltd. Vs. Dolly George J.T. 1999 (10) SC 381, the Hon'ble Apex Court wherein it was held as held as under.- "2. The appellant-company has filed a complaint before a Magistrate Cour....
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....at the threshold on the premise that the individual has not produced certified copy of the resolution appears to be too hasty an action. We, therefore, set aside the impugned orders and direct the trial court to proceed with the trial and dispose it off in accordance with law. Parties are directed to appear before the trial court on 31.01.2000." 40. Further, the said issue came up for consideration in M/s M.M.T.C. Ltd. Vs. Medchl Chemicals and Pharma (P) Ltd. (2002) 1 SCC 234, wherein it was held as under.- 11. This Court has, as far back as, in the case of Vishwa Mitter v. O.P. Poddar [(1983) 4 SCC 701 : 1984 SCC (Cri) 29] held that it is clear that anyone can set the criminal law in motion by filing a complaint of facts constituting an offence before a Magistrate entitled to take cognizance. It has been held that no court can decline to take cognizance on the sole ground that the complainant was not competent to file the complaint. It has been held that if any special statute prescribes offences and makes any special provision for taking cognizance of such offences under the statute, then the complainant requesting the Magistrate to take cognizance of the offence must....
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...., an elucidation can be found in the judgment of this Court in Associated Cement Co. Ltd. v. Keshavanand2. If a complaint was made in the name of the Company, it is necessary that a natural person represents such juristic person in the court and the court looks upon the natural person for all practical purposes. It is in this context that observations were made that the body corporate is a de jure complainant while the human being is a de facto complainant to represent the former in the court proceedings. Thus, no Magistrate could insist that the particular person whose statement was taken on oath alone can continue to represent the Company till the end of the proceedings. Not only that, even if there was initially no authority the Company can at any stage rectify that defect by sending a competent person. The aforesaid judgment was also taken note of in a subsequent judgment of this Court in M.M.T.C. Ltd. & Anr. v. Medchl Chemicals and Pharma (P) Ltd. & Anr. 20. We find that the judicial precedents cited aforesaid have been breached by the Courts below. The High Court also embarked on a discussion as to the vagueness of the identity of the complainant and its relation wit....
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.... in accordance with law. This is so because procedural defects and irregularities, which are curable, should not be allowed to defeat substantive rights or to cause injustice. Procedure, a handmaiden to justice, should never be made a tool to deny justice or perpetuate injustice, by any oppressive or punitive use. (See Uday Shankar Triyar v. Ram Kalewar Prasad Singh [(2006) 1 SCC 75] .)" 43. The issue of non-authorization by a firm to a person who had filed the complaint and its effect came up for consideration before the High Court of Karnataka Circuit Bench at Gulbarga in Padmawati Finanace Vs. Md. Yosuf Ali: Criminal Appeal No. 3608 of 2009 decided on 05.07.2023, wherein it was observed as under.- "7. Learned counsel for the complainant submitted that the complainant is partnership firm. The complainant is one of the partners of the firm has permitted to file complaint against the accused under Sections 138 and 142 of the Act. The Trial Court is therefore not justified in acquitting the accused on the sole ground that the complainant was not authorised by the firm, who filed complaint under Section 138 of the Act. 24. Even during trial, the accused had not p....
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....#2367;युक्तगण नं० 2, 3, व 4 कोटसन्स प्राइवेट लि० (विपक्षी नं01) के मेनेजिंग डायरेक्टर एवं डायरेक्टर्स हैं तथा कम्पनी के लेन-देन व व्यापार तथा दिन- प्रतिदिन के कार्यों के लिए उत्तरदायी व जिम्मेदार हैं।" 46. A birds eye view to para 1 of the complaint, would reveal that averments have been made tha....
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....ware that the cheques will be dishonoured. Further, it is alleged that all the accused knew that there were no funds in the account of accused No.1 - company. 9. Sub-section 1 of Section 141 of the NI Act required the complainant to aver that the present appellants at the time of the commission of the offence were in charge of, and were responsible to the company for the conduct of the business of the company. In the present case, all that the second respondent has alleged is that the appellants were liable for transactions of the company and that they were fully aware of the issuance of the cheques and dishonour of the cheques. 10. Therefore, even if we decide to take a broad and liberal view of the pleadings in the complaint, we are unable to draw a conclusion that compliance with the requirements of sub-section 1 of Section 141 N.I. Act was made by the second respondent. The most important averment which is required by sub-Section (1) of Section 141 of the NI Act is that the directors were in charge of, and were responsible for the conduct of the company. The appellants are neither the signatories to the cheques nor are whole- time directors. The decision in th....
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....-section 1 of Section 141 NI Act must be a person who at the time the offence was committed was in charge of and was responsible to the company for the conduct of the business of the company. Merely because somebody is managing the affairs of the company, per se, he does not become in charge of the conduct of the business of the company or the person responsible for the company for the conduct of the business of the company. For example, in a given case, a manager of a company may be managing the business of the company. Only on the ground that he is managing the business of the company, he cannot be roped in based on sub-section 1 of Section 141 of the NI Act." 48. In the said case the only assertion was that the accused were all jointly and severely liable for the transaction of the company and all accused are fully aware of the issuance of the above cheque without balance in the account and they are also fully aware about the cheque will be dishonored. Indeed, the said recitals are thoroughly insufficient and does not conform to Section 141 and further the appellant in the said case was neither the signatory to the cheque nor the wholetime Director. 49. Hon'ble Apex Co....
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....s of the Company. It may not be proper to split while reading the complaint so as to come to a conclusion that the allegations as a whole are not sufficient to fulfil the requirement of Section 141 of the NI Act. The complaint specifically refers to the point of time when the cheques were issued, their presentment, dishonour and failure to pay in spite of notice of dishonour. In the given circumstances, we have no hesitation in overruling the argument made by the learned counsel for the appellants. 28. Indisputedly, on the presentation of the cheque of Rs.10,00,000/- (Rupees Ten Lakhs only) dated 2 nd June 2012, the cheque was dishonoured due to "funds insufficient" in the account and after making due compliance, complaint was filed and after recording the statement of the complainant, proceedings were initiated by the learned Magistrate and no error has been committed by the High Court in dismissing the petition filed under Section 482 Cr.P.C. under the impugned judgment." 29. The submission of learned counsel for the appellants that they are the non-executive Directors in the light of the documentary evidence placed on record by Form No. 32 issued by the Registr....
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....s no more res integra as the Hon'ble Apex Court in P. Mohanraj (supra), wherein the following was observed. - 77. As far as the Directors/persons in management or control of the corporate debtor are concerned, a Section 138/141 proceeding against them cannot be initiated or continued without the corporate debtor - see Aneeta Hada (supra). This is because Section 141 of the Negotiable Instruments Act speaks of persons in charge of, and responsible to the company for the conduct of the business of the company, as well as the company. The Court, therefore, in Aneeta Hada (supra) held as under:- "51. We have already opined that the decision in Sheoratan Agarwal [(1984) 4 SCC 352 : 1984 SCC (Cri) 620] runs counter to the ratio laid down in C.V. Parekh [(1970) 3 SCC 491 : 1971 SCC (Cri) 97] which is by a larger Bench and hence, is a binding precedent. On the aforesaid ratiocination, the decision in Anil Hada [(2000) 1 SCC 1 : 2001 SCC (Cri) 174] has to be treated as not laying down the correct law as far as it states that the Director or any other officer can be prosecuted without impleadment of the company. Needless to emphasise, the matter would stand on a different f....
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....sis of the ratio laid down in C.V. Parekh [(1970) 3 SCC 491 : 1971 SCC (Cri) 97] which is a three- Judge Bench decision. Thus, the view expressed in Sheoratan Agarwal [(1984) 4 SCC 352 : 1984 SCC (Cri) 620] does not correctly lay down the law and, accordingly, is hereby overruled. The decision in Anil Hada [(2000) 1 SCC 1 : 2001 SCC (Cri) 174] is overruled with the qualifier as stated in para 51. The decision in Modi Distillery [(1987) 3 SCC 684 : 1987 SCC (Cri) 632] has to be treated to be restricted to its own facts as has been explained by us hereinabove." Since the corporate debtor would be covered by the moratorium provision contained in Section 14 of the IBC, by which continuation of Section 138/141 proceedings against the corporate debtor and initiation of Section 138/141 proceedings against the said debtor during the corporate insolvency resolution process are interdicted, what is stated in paragraphs 51 and 59 in Aneeta Hada (supra) would then become applicable. The legal impediment contained in Section 14 of the IBC would make it impossible for such proceeding to continue or be instituted against the corporate debtor. Thus, for the period of moratorium, since no ....
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....n. Therefore, it is only the resolution professional who can represent the accused Company during the pendency of the proceedings under IBC. After the proceedings are over, either the corporate entity may be dissolved or it can be taken over by a new management in which event the company will continue to exist. When a new managements takes over, it will have to make arrangements for representing the company. If the company is dissolved as a result of the resolution process, obviously proceedings against it will have to be terminated. But even then, its erstwhile Directors may not be able to take advantage of the situation. This is because, this Court in Aneeta Hada, even while overruling its decision in Anil Hada v. Indian Acrylic Ltd., as not laying down the correct law insofar as Anil Hada states that the Director or any other officer can be prosecuted without impleadment of the company, proceeded to hold that the matter would stand on a different footing where there is some legal impediment as the doctrine of lex non cogit ad impossibilia gets attracted. It was specifically observed that the decision in Anil Hada is overruled with the qualifier as stated in para 51. Con....
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....its liability. (b) a discharge which the principal debtor may secure by operation of law in bankruptcy (or in liquidation proceedings in the case of a company) does not absolve the surety of his liability. 82. The same principle is applicable to the signatory/Director in the case of Sections 138/141 proceedings. The signatory/Director cannot take benefit of discharge obtained by the corporate debtor by operation of law under IBC. 98. As per Section 138 of the NI Act, when the cheque was dishonoured and a statutory notice demanding the cheque amount was issued, the accused shall pay the cheque amount within 15 days from the date of receipt of the said notice. The moment the said 15 days expired, the cause of action arises. In other words, the offence under Section 138 of the NI Act is complete. Once the cause of action arose for the offence committed, the complainant has to approach the criminal court within one month to take penal action under Section 138 of the NI Act. To put it clearly, the complainant approaches the criminal court not for recovery of the legally enforceable debt, but for taking penal action under Section 138 of the NI Act for the offen....
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....that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall, without prejudice to any other provision of this Act, be punished with imprisonment for [a term which may be extended to two years], or with fine which may extend to twice the amount of the cheque, or with both: Provided that nothing contained in this section shall apply unless- (a) the cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier; (b) the payee or the holder in due course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice; in writing, to the drawer of the cheque, [within thirty days] of the receipt of information by him from the bank regarding the return of the cheque as unpaid; and (c) the drawer of such cheque fails to make the payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the cheque, within ....
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....e so, they initiated the personal insolvency proceedings under the IBC and sought exemption from the Section 138 proceedings before the trial Court, referring to interim moratorium provided under Section 96 IBC. It is to be noted that upon the application being admitted, the moratorium provisions under the IBC offer protection only to the corporate debtor, i.e., the company, and do not extend protection against civil liability to personal guarantors by specific exclusion or to any individual who is prosecuted for committing a criminal act. 12. The legislative intent behind the Insolvency and Bankruptcy Code (IBC) is to provide a structured framework for the resolution of corporate debtors' financial distress, facilitating their rehabilitation and ensuring the maximization of asset value. The application under Section 94 or 95 would fall under Chapter III of the IBC. An application under Section 94, when taken out by a debtor in the capacity of a personal guarantor of a company, to declare him/her as insolvent, is to be disposed by following the procedures in Sections 97 to 119. The application filed under Section 94 is scrutinized by the Resolution Professional and a r....
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....on 138 of the N.I. Act, 1881, pertain to the dishonor of cheques issued by the respective appellants / petitioners in their personal capacity. These proceedings are distinct from the corporate insolvency proceedings and are aimed at upholding the integrity of commercial transactions by holding individuals accountable for their personal actions. The scope and nature of the proceedings under the IBC may result in extinguishment of the actual debt by restructuring or through the process of liquidation. But such extinguishment will not absolve its directors from the criminal liability. Section 141 of the N.I. Act, 1881 enables the prosecution of the persons in charge of the affairs and responsible for the conduct of the business of the company along with the company. The statutory liability against the directors under Section 138 of the N.I. Act, 1881, is personal and hence, continues to bind natural persons, irrespective of any moratorium applicable to the corporate debtor. The acceptance of the resolution plan under Section 31 IBC or its implementation thereof will have no effect on the prosecution under Section 138 of the N.I. Act, 1881. Similarly, the acceptance of the report by th....
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....e to the applicants particularly when in the said case the cheque was drawn on 25.07.2018 dishonored on 07.07.2018, notice was issued on 06.08.2018, complaint was filed in September, 2018, moratorium under Section 14 of the IBC was imposed on 25.07.2018. The Court opined that since before issuance of the statutory notice dated 06.08.2018, moratorium has been imposed on 25.07.2018, thus, the proceedings cannot go on. However, in the present case, the cheques were drawn on 01.12.2022, it was presented on 22.02.2023, dishonored on 23.02.2023, notices were issued on 20.03.2023, served upon the applicants on 22.03.2023 and the complaint was filed on 21.04.2023 but moratorium was imposed under Section 14 of the IBC on 09.06.2023. Even otherwise in view of the authoritative judgments of the Hon'ble Apex Court in P. Mohanraj (supra), Ajay Kumar Radheshyam Goenka (supra) & Rakesh Bhanot (supra), the applicants being the Director of the body corporate are not entitled to any protection under Section 14 of the IBC and they have no right to forestall the proceedings under Section 138 of the NI Act. 59. The extent and the scope of invocation of the jurisdiction u/s 482 Cr.P.C./u/s 528 BNSS i....