9911796707
TMI Blog2025 (5) TMI 1001X X X X Extracts X X X X X X X X Extracts X X X X ..... onal Chief Metropolitan Magistrate, NIA Court No.30, Ahmedabad Magistrate, vide judgment and order dated 03rd April, 2017, in a case registered under the provisions of Section 138 of the Negotiable Instruments Act, 1881 N.I. Act, for dishonour of a cheque. He was sentenced to undergo imprisonment for two years and to pay Rs.2,50,00,000/- (Rupees two crore fifty lakh) as compensation. 2. An appeal was carried from the said judgment and order by the appellant before the Sessions Court at Ahmedabad sessions court. 3. During the pendency of the appeal, a petition came to be admitted by the National Company Law Tribunal, Ahmedabad against a company. The appellant happens to be one of the Directors of the company. 4. By an order dated 19th Mar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the cheque amount as directed by the order dated 13th August, 2018. This triggered an application Criminal Misc. Application No.1 of 2019 in CRA No.955/ 2018 from the side of the complainant seeking cancellation of bail. It was alleged therein that despite expiry of the time limit fixed by the earlier order dated 13th August, 2018, the appellant had not deposited any sum. 11. Learned counsel representing the appellant before the High Court urged that he was not required to make payment of any sum in terms of the earlier direction. 12. The learned judge disagreed and overruled such contention. The application filed by the complainant was allowed by an order dated 25th September, 2019 and the order dated 13th August, 2018, passed on the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scrutinized by the Resolution Professional and a report is submitted as contemplated under Section 99 recommending either the approval or rejection of the application. The interim moratorium which commences on the presentation of the application will expire on the admission of the application by an order of the adjudicating authority under Section 100. Upon admission, the moratorium under Section 101 comes into operation. The interim moratorium under Section 96 and the moratorium under Section 101 IBC are designed to offer a breathing space to the corporate debtor, allowing them to reorganize their financial affairs without the immediate threat of creditor actions. However, this moratorium is not intended to shield individuals from persona ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vocal language of this provision reflects the legislative intent to provide a protective shield for debtors during the insolvency process. 13. On the other hand, the proceedings under Section 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Having perused the decision in Rakesh Bhanot (supra), we share the view expressed therein. 18. There is, thus, no reason to hold that because the company has been liquidated, the appellant has no liability. Incidentally, the appellant was convicted even before the process under the Insolvency and Bankruptcy Code was initiated. Further, his position is that of a personal guarantor for the loan advanced to the company. Also, NCLAT expressly permitted proceedings under Section 138 of the N.I. Act to continue. 19. For the reasons aforesaid, it is not open to the appellant to claim protection by urging that proceedings under Section 138 of the N.I. Act cannot be carried forward against him. 20. In view of the peculiar facts and circumstances ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
