TMI Blog2019 (4) TMI 1862X X X X Extracts X X X X X X X X Extracts X X X X ..... process under the Insolvency and Bankruptcy Code, 2016. The Section 14 of Insolvency and Bankruptcy Code, 2016 prohibits the institution of suits or continuation of pending suits or proceedings against the Corporate Debtor. It means only civil proceedings and not criminal proceedings as against the debtor. This Court has held that there is no prohibition either in the Insolvency Act or in the Negotiable Instruments Act for the complainant to approach the criminal court to take penal action against the accused for the offence already committed under Section 138 of Negotiable Instruments Act either because the insolvency proceedings are pending or even he was declared as an insolvent. Therefore there is no bar to initiate proceedings unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st dated cheque in favour of the respondent for discharge of their debts arising out of supply of tanning chemicals for a sum of ₹ 20,00,000/-. It was presented for collection and was returned dishonoured for the reason that 'funds insufficient'. After causing statutory notice, the respondent initiated proceedings under the Negotiable Instruments Act. He further submitted that the petitioner categorically replied for the statutory notice stating that the company M/s.Nag Leathers Private Limited was already taken over by the Interim Insolvency Resolution Professional as per the Order of National Company Law Tribunal, Division Bench, Chennai. He further submitted that one of the creditors filed an application under Section 9 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nning chemicals and supplied the same. During the course of business, the balance amount of ₹ 20,00,000/- had become due and payable by the petitioner. The petitioner issued a post dated cheque in favour of the respondent for discharge of their debt arising out of supply of the tanning chemicals for the said sum. It was presented for collection and the same was returned dishonoured for the reason that 'funds insufficient'. After issuance of statutory notice, the respondent initiated proceedings under Section 138 of Negotiable Instruments Act as against the petitioner. 5. He further submitted that the initiation of proceedings under Section 138 of Negotiable Instruments Act is a statutory one and it is entirely different f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vent? 9. Admittedly after issuance of cheques to the respondent for the purchase of the tanning chemicals, one of the Creditors initiated proceedings under Section 9 of the Insolvency and Bankruptcy Code against the respondent. As pointed out by the learned counsel for the respondent, the offence under the Negotiable Instruments Act is a statutory one and the proceedings under the Negotiable Instruments Act is completely different from the Corporate Insolvency Resolution process under the Insolvency and Bankruptcy Code, 2016. The Section 14 of Insolvency and Bankruptcy Code, 2016 prohibits the institution of suits or continuation of pending suits or proceedings against the Corporate Debtor. It means only civil proceedings and not crimi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the complainant to approach the criminal court to take penal action against the accused for the offence already committed under Section 138 of Negotiable Instruments Act either because the insolvency proceedings are pending or even he was declared as an insolvent. Therefore there is no bar to initiate proceedings under the criminal law against the debtor, though he was declared as an insolvent. The bar has been extended only in respect of civil detention and civil arrest. It would not cover the proceedings under Section 138 of Negotiable Instruments Act. It is relevant to extract the Section 14 of Insolvency and Bankruptcy Code, 2016. 14(1)a. The institution of the suits or continuation of the pending suits or proceedings against ..... X X X X Extracts X X X X X X X X Extracts X X X X
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