Section 138 NI Act Proceedings Continue Despite Personal Insolvency Moratorium: SC

Dineshchand Surana Vs UCO Bank (Supreme Court of India) “Negotiable Instruments Act, 1881 – Sections 138, 141, 143-A, 148; Insolvency and Bankruptcy Code, 2016 – Sections 96, 101, 124, 128, 79(15); Bharatiya Nagarik Suraksha Sanhita, 2023 – Section 395. Issue was whether moratorium under Part III of the IBC bars proceedings under Section 138 NI Act against a person undergoing personal insolvency/bankruptcy and against directors vicariously liable under Section 141. Held that Section 138, though quasi-criminal and arising from a civil transaction, is predominantly criminal in nature; th...