P. Mohanraj v. Shah Brothers Ispat
Supreme Court of India(2021) 6 SCC 258Bench: J. R.F. Nariman, J. S. Ravindra Bhat, J. V. Ramasubramanian
The Supreme Court (3-Judge Bench) held: (1) A criminal complaint under Section 138 NI Act constitutes a "proceeding" within the meaning of Section 14(1)(a) IBC. Therefore, the moratorium under Section 14 IBC DOES stay S.138 NI Act proceedings against the CORPORATE DEBTOR during the CIRP period. (2) However, the moratorium under Section 14 IBC protects only the assets and proceedings against the corporate debtor as a company — it does NOT extend to proceedings against natural persons (directors, officers) who are separately liable under Section 141 NI Act. S.141 NI Act creates an independent, personal criminal liability for natural persons responsible for the company's conduct. This personal liability survives the IBC moratorium and proceedings against directors under S.141 continue unaffected by CIRP. (3) The Court noted that if the company is ultimately absolved by a resolution plan approved under IBC, this may constitute a defence in the S.138 proceeding — but that is separate from the moratorium question.