S.138 NI Act | Directors Cannot Avoid Liability for Cheque Dishonour Merely Because the Company Has Been Declared Insolvent: Orissa High Court

The Orissa High Court recently ruled that directors of a company cannot escape criminal liability for cheque dishonour under Section 138 of the Negotiable Instruments Act, 1881 merely because the company was declared insolvent and a Resolution Professional was appointed under the Insolvency and Bankruptcy Code, 2016. The Bench led by Justice Chittaranjan Dash emphasized that insolvency proceedings do not affect ongoing criminal proceedings related to cheque dishonour. Background of…