In a recent ruling, the Bombay High Court held that the moratorium imposed under the Insolvency and Bankruptcy Code, 2016 (IBC) does not bar criminal proceedings against natural persons, such as directors, for offences committed under the NI Act, even if the insolvency proceedings were initiated prior to the cheque’s dishonour.
The Court allowed a criminal writ petition filed by Ortho Relief Hospital and Research Centre,petitioner setting aside an order that had discharged the directors of a company in a cheque bounce case under Section 138 of the Negotiable Instruments Act, 1881 (NI Act).
The petitioner had extended a loan of Rs. 15 lakhs to the company, M/s Anand Distilleries, against a cheque signed by its…