RAKESH BHANOT versus M/S. GURDAS AGRO PVT. LTD

RAKESH BHANOT versus M/S. GURDAS AGRO PVT. LTD

The interim moratorium under Section 96 IBC, triggered by filing applications under Section 94/95 IBC, operates to stay civil legal proceedings in respect of debts but does not stay or bar criminal prosecutions under Section 138 read with Section 141 of the Negotiable Instruments Act, 1881; consequently, appellants cannot invoke Section 96 IBC to stay Section 138 prosecutions and the appeals and writ petition are dismissed.

Parties
Appellant: Rakesh Bhanot; Respondent: M/s. Gurdas Agro Pvt. Ltd.
Jurisdiction
India
Judgment Date
31 March 2025
Procedural Posture
Criminal Appeal / Appeal to Supreme Court, Judgment Disposing of Appeals and Writ Petition
Outcome
Criminal appeals and writ petitions dismissed.
Legal Topics
Moratorium, Interim Moratorium, Personal Insolvency, Stay of Proceedings, Dishonour of Cheques, Directors' Criminal Liability, Section 94 IBC, Section 96 IBC, Section 138 NI Act, Section 141 NI Act, Section 101 IBC
Insolvency and Bankruptcy Code, 2016 Negotiable Instruments Act, 1881 Criminal Procedure Code, 1973 Moratorium Interim Moratorium Personal Insolvency Stay of Proceedings Dishonour of Cheques +6 more

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Parties

Rakesh Bhanot

Appellant

M/s. Gurdas Agro Pvt. Ltd.

Respondent

Procedural Posture

Criminal Appeal / Appeal to Supreme Court, Judgment Disposing of Appeals and Writ Petition

Legal Issues

  1. 1 Whether proceedings under Section 138 read with Section 141 of the Negotiable Instruments Act, 1881 should be stayed by operation of the interim moratorium under Section 96 of the Insolvency and Bankruptcy Code, 2016 arising from filing of applications under Section 94 IBC
  2. 2 Whether moratorium under Sections 96/101 IBC protects natural persons (directors/personal guarantors) from criminal prosecution under Section 138 NI Act

Ratio Decidendi

The interim moratorium under Section 96 IBC, triggered by filing applications under Section 94/95 IBC, operates to stay civil legal proceedings in respect of debts but does not stay or bar criminal prosecutions under Section 138 read with Section 141 of the Negotiable Instruments Act, 1881; consequently, appellants cannot invoke Section 96 IBC to stay Section 138 prosecutions and the appeals and writ petition are dismissed.

Court Disposition

Criminal appeals and writ petitions dismissed.

Orders

  • All criminal appeals and writ petition dismissed.
  • Pending application(s), if any, shall stand closed.