The Orissa High Court, Bench comprising Justice Chittaranjan Dash, has ruled that the proceedings under section 138 of the NI Act will sustain against the directors or signatories of the company even if the entity has been declared insolvent under the IBC, 2016.
The complainant extended a loan of Rs. 1 Cr. to Zenith Mining Pvt. Ltd., which remains unpaid. The check issued by the respondent was dishonored twice with the remark ‘refer to drawer.’ These events led the complainant to file a case under section 138 of the NI Act before the JMFC (LR), Bhubaneshwar.
The petitioner before the Hon’ble High Court filed an application before the trial court seeking the discharge from the prosecution, citing that the company has …