FEMA, BANKING & INSURANCE/IBC : Vicarious prosecution against MD for dishonour of company’s cheque can’t be quashed on the plea that he was not in charge as IRP had been appointed by NCLT.

• Vicarious prosecution against Managing Director of company for dishonour of company’s cheque can’t be quashed on the plea that he was not in charge as Interim Resolution Professional had been appointed and he was not in charge of company’s affairs and had not signed the disputed cheque as these are matters of fact which can be determined only during a trial.

• Disputed facts cannot be gone into by HC by holding a enquiry or a mini trial at this stage. With regard to maintainability of the complaint, in view of the order passed by the Hon’ble Supreme Court in the above stated decision, the complaint as against this petitioner/A3 and the 2nd accused is maintainable and the same can be proceeded. The protection granted vide order of the National Company Law Tribunal under Section 14 of the I&B Code, is not extended to persons involved in the affairs of the company. The protection was only for the corporate debtor. Other disputed facts has to be gone into only at the time of trial.
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HIGH COURT OF MADRAS
G. Ajay Agarwal
v.
Bhagwandas and Co.
RMT. TEEKAA RAMAN, J.
CRL. O.P.NO. 26935 OF 2018
CRL.M.P.NO. 15550 OF 2018
SEPTEMBER 28, 2022
M.A. Mathew Berchmans for the Petitioner. K. Bijai Sundar for the Respondent.

**ADV MEGHA** ALL RIGHTS RESERVED.

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Prosecution against MD for cheque dishonor can’t be quashed on plea that he wasn’t in charge as IRP was appointed by NCLT