Corporate Insolvency Resolution Halts Cheque Dishonor Proceedings Against Debtor While Allowing Action Against Individual Accused Under Section 14

HC held that during Corporate Insolvency Resolution Process, Section 14 of Insolvency Code imposes moratorium preventing continuation of cheque dishonor proceedings against corporate debtor. Proceedings against natural persons under Section 141 of Negotiable Instruments Act remain maintainable. The impugned order stands set aside, with all proceedings against corporate debtor deferred until moratorium is lifted. Magistrate Court directed to proceed against individual accused, expediting trial in compliance with prior court directions. The original petition stands disposed of, establishing clear demarcation between corporate and individual liability during insolvency resolution process. .....

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