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TMI Blog2023 (6) TMI 534X X X X Extracts X X X X X X X X Extracts X X X X ..... [ 2023 (2) TMI 1149 - BOMBAY HIGH COURT] agreed upon, wherein the High Court has held When the cheques were presented for encashment, the respondents were no longer in control and management of day to day affairs of the Corporate Debtor. It is not known as to whether there were sufficient funds in the bank account of Corporate Debtor to honour the cheques. Since from the date of the admission of the CIRP proceedings, it was the IRP who was In-Charge of and responsible for the conducting the business of the company at the time when the cheques were presented for encashment, it is thus clear that the role of the natural persons had ceased - The instrument, namely, the cheque on the basis of which the complaint was filed could not have been encashed by the financial institutions in view of the mandate of Section 14 IBC read with Section 17 and 18 IBC - On the basis of the combined reading, it is the IRP who had the authority to operate the bank accounts and on the date of presentation, the petitioners cannot be stated to be in control and management of the affairs of M/s Ajanta. In the judgment of P. MOHANRAJ ORS. VERSUS M/S. SHAH BROTHERS ISPAT PVT. LTD. [ 2021 (3) TMI 9 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... admitted on 04.02.2020. In this view of the matter, the moratorium envisaged under Section 14(1) of the Code started operating from the said date. 5. The IRP Mr. Satyanarayana Guddeti on 07.02.2020 addressed emails to all the banks of M/s Ajanta directing not to allow any debit transaction from the accounts without the written approval or instructions of the Interim Resolution Professional (hereinafter called IRP). 6. The cheques in question were presented for encashment on 12.02.2020 and on 13.02.2020, the same were dishonoured with the remarks payment stopped by drawer . 7. It is stated by Mr. Wadhwa, learned senior counsel for the petitioners that in the present case, in view of the moratorium, the cheques were incapable of encashment and hence, the petitioners cannot be liable for prosecution under Section 138 of the NI Act. He relies upon a judgment of the Bombay High Court in Asmita Sarang vs. Yogesh Badoni and Another 2023 SCC OnLine Bom 528 . 8. Mr. Sharma, learned counsel for the respondent disputes the proposition and states that the Hon ble Supreme Court in P. Mohanraj Others vs. Shah Brothers Ispat Private Limited [(2021) 6 SCC 258] mandates t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st created by the corporate debtor in respect of its property including any action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002; (d) the recovery of any property by an owner or lessor where such property is occupied by or in the possession of the corporate debtor. [ Explanation . For the purposes of this sub-section, it is hereby clarified that notwithstanding anything contained in any other law for the time being in force, a license, permit, registration, quota, concession, clearances or a similar grant or right given by the Central Government, State Government, local authority, sectoral regulator or any other authority constituted under any other law for the time being in force, shall not be suspended or terminated on the grounds of insolvency, subject to the condition that there is no default in payment of current dues arising for the use or continuation of the license, permit, registration, quota, concession, clearances or a similar grant or right during the moratorium period;] (2) The supply of essential goods or services to the corporate debtor as may be specified shall not be terminated or sus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is thus clear that the role of the natural persons had ceased. 16. The instrument, namely, the cheque on the basis of which the complaint was filed could not have been encashed by the financial institutions in view of the mandate of Section 14 IBC read with Section 17 and 18 IBC. 17. Section 17 and 18 IBC read as under:- 17. Management of affairs of corporate debtor by interim resolution professional. (1) From the date of appointment of the interim resolution professional, (a) the management of the affairs of the corporate debtor shall vest in the interim resolution professional; (b) the powers of the board of directors or the partners of the corporate debtor, as the case may be, shall stand suspended and be exercised by the interim resolution professional; (c) the officers and managers of the corporate debtor shall report to the interim resolution professional and provide access to such documents and records of the corporate debtor as may be required by the interim resolution professional; (d) the financial institutions maintaining accounts of the corporate debtor shall act on the instructions of the interim resolution professional in re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ownership rights which may be located in a foreign country; (ii) assets that may or may not be in possession of the corporate debtor; (iii) tangible assets, whether movable or immovable; (iv) intangible assets including intellectual property; (v) securities including shares held in any subsidiary of the corporate debtor, financial instruments, insurance policies; (vi) assets subject to the determination of ownership by a court or authority; (g) to perform such other duties as may be specified by the Board. Explanation . For the purposes of this [section], the term assets shall not include the following, namely: (a) assets owned by a third party in possession of the corporate debtor held under trust or under contractual arrangements including bailment; (b) assets of any Indian or foreign subsidiary of the corporate debtor; and (c) such other assets as may be notified by the Central Government in consultation with any financial sector regulator. 18. On the basis of the combined reading, it is the IRP who had the authority to operate the bank accounts and on the date of presentation, the petitioners cannot be stated ..... X X X X Extracts X X X X X X X X Extracts X X X X
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