The Orissa High Court has recently held that directors of a company cannot be absolved of their liability for the offence of cheque dishonour under Section 138 of the Negotiable Instruments Act, 1881 (‘the NI Act’) merely because the company was declared insolvent and a Resolution Professional was appointed under the Insolvency and Bankruptcy Code, 2016 (‘the IBC’).
While determining the extent of liability of directors of an insolvent company, the Bench of Justice Chittaranjan Dash held –
“In view of the above position of law, there remains no ambiguity with respect to the principle propounded by the Hon’ble Supreme Court, namely, that the matter lying before the Resolution Professional pursuant to the order dated 08.11.2024 of the…