{"id":382564,"date":"2026-04-28T11:00:47","date_gmt":"2026-04-28T05:30:47","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=382564"},"modified":"2026-05-01T18:16:15","modified_gmt":"2026-05-01T12:46:15","slug":"sc-dismisses-plea-against-directors-s138-ni-act-liability-during-liquidation","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2026\/04\/28\/sc-dismisses-plea-against-directors-s138-ni-act-liability-during-liquidation\/","title":{"rendered":"Cheque dishonour| Director’s S. 138 NI Act liability subsists despite liquidation of the company: Supreme Court"},"content":{"rendered":"
\n

Supreme Court:<\/span> In a special leave petition assailing the Bombay High Court order<\/a> wherein Petitioner 1 was held liable under Section 138<\/a>, Negotiable Instruments Act, 1881<\/a> (NI Act), even though the company was under liquidation, the Division Bench of B.V. Nagarathna and Ujjal Bhuyan, JJ.<\/span>, refused to interfere with the High Court order and dismissed the SLP.<\/p>\n

Also Read:<\/span> Insolvency proceedings no shield for Directors in cheque dishonour cases under S. 138 NI Act: Orissa HC<\/a><\/p>\n

The petitioners-accused had taken a loan from Respondent 1\/complainant and allegedly repaid the amount through a post-dated cheque signed by Petitioner 1 in his capacity as Director and authorised signatory of Respondent 2-Company. The cheque was dishonoured, following which Respondent 1 filed a complaint under Section 138<\/a>, NI Act<\/a>. Subsequently, an order of liquidation was passed against Respondent 2-Company.<\/p>\n

Also Read:<\/span> Section 138 NI Act Explained: When Does a Cheque Bounce Become a Criminal Offence?<\/a><\/p>\n

The petitioners filed an application for discharge, which was allowed by the trial court on the ground that, post liquidation, they had ceased to be Directors and could not be held liable.<\/p>\n

Aggrieved, Respondent 1 approached the Bombay High Court, which allowed the writ petition and held that liability under Section 138<\/a>, NI Act<\/a> subsists notwithstanding initiation of proceedings under the Insolvency and Bankruptcy Code, 2016<\/a>. The order of discharge was accordingly set aside.<\/p>\n

Aggrieved thereby, the petitioners preferred the present special leave petition. The Court found no reason to interfere with the impugned order and dismissed the special leave petition.<\/p>\n

Also Read:<\/span> Supreme Court clears the air on which Court has the jurisdiction to try complaint under S. 138 NI Act in respect of account payee cheque<\/a><\/p>\n

[Abhaykumar Anandkumar Bhambore<\/span> v. Ortho Relief Hospital and Research Centre<\/span>, 2026 SCC OnLine SC 736<\/a>, ordered on 16-4-2026<\/span>]<\/p>\n\n

Advocates who appeared in this case:<\/p>\n

For the petitioner:<\/span> AOR Nitin Bhardwaj<\/p>\n

For the respondent:<\/span> AOR Vatsalya Vigya with Saahiil Dewani, Shakul R. Ghatole, Shyam Dewani, Sachet Makhija, and Dashang Doshi, Advocates<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

The Court denied the discharge of the company director in a cheque dishonour case wherein the said company was undergoing liquidation.<\/p>\n","protected":false},"author":67011,"featured_media":382568,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3,9],"tags":[2569,67638,63958,103167,30361,44583,60540,37644,30606,103168,5363],"class_list":["post-382564","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-casebriefs","category-supremecourt","tag-Bombay_High_Court","tag-cheque-dishonour-case","tag-company-director","tag-company-liquidation","tag-ibc","tag-insolvency-and-bankruptcy","tag-justice-b-v-nagarathna","tag-justice-ujjal-bhuyan","tag-ni-act","tag-s-138-ni-act-liability-during-liquidation","tag-supreme-court"],"yoast_head":"\nSC dismisses plea against Director's S. 138 NI Act liability during liquidation | SCC Times<\/title>\n<meta name=\"description\" content=\"Supreme Court refused to interfere with the Bombay High Court order holdingthat directors' S. 138 NI Act liability subsists despite liquidation\/IBC proceedings.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.scconline.com\/blog\/post\/2026\/04\/28\/sc-dismisses-plea-against-directors-s138-ni-act-liability-during-liquidation\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Cheque dishonour| Director's S. 138 NI Act liability subsists despite liquidation of the company: Supreme Court\" \/>\n<meta property=\"og:description\" content=\"Supreme Court refused to interfere with the Bombay High Court order holdingthat directors' S. 138 NI Act liability subsists despite liquidation\/IBC proceedings.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.scconline.com\/blog\/post\/2026\/04\/28\/sc-dismisses-plea-against-directors-s138-ni-act-liability-during-liquidation\/\" \/>\n<meta property=\"og:site_name\" content=\"SCC Times\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/scc.online\/\" \/>\n<meta property=\"article:published_time\" content=\"2026-04-28T05:30:47+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2026-05-01T12:46:15+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.scconline.com\/blog\/wp-content\/uploads\/2026\/04\/blog-16-32.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"886\" \/>\n\t<meta property=\"og:image:height\" content=\"590\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Editor\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"Cheque dishonour| Director's S. 138 NI Act liability subsists despite liquidation of the company: Supreme Court\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Editor\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"NewsArticle\",\"@id\":\"https:\\\/\\\/www.scconline.com\\\/blog\\\/post\\\/2026\\\/04\\\/28\\\/sc-dismisses-plea-against-directors-s138-ni-act-liability-during-liquidation\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.scconline.com\\\/blog\\\/post\\\/2026\\\/04\\\/28\\\/sc-dismisses-plea-against-directors-s138-ni-act-liability-during-liquidation\\\/\"},\"author\":{\"name\":\"Editor\",\"@id\":\"https:\\\/\\\/www.scconline.com\\\/blog\\\/#\\\/schema\\\/person\\\/84e42bab48238baf12c7e33b3d9761fe\"},\"headline\":\"Cheque dishonour| Director’s S. 138 NI Act liability subsists despite liquidation of the company: Supreme Court\",\"datePublished\":\"2026-04-28T05:30:47+00:00\",\"dateModified\":\"2026-05-01T12:46:15+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/www.scconline.com\\\/blog\\\/post\\\/2026\\\/04\\\/28\\\/sc-dismisses-plea-against-directors-s138-ni-act-liability-during-liquidation\\\/\"},\"wordCount\":333,\"commentCount\":0,\"image\":{\"@id\":\"https:\\\/\\\/www.scconline.com\\\/blog\\\/post\\\/2026\\\/04\\\/28\\\/sc-dismisses-plea-against-directors-s138-ni-act-liability-during-liquidation\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/www.scconline.com\\\/blog\\\/wp-content\\\/uploads\\\/2026\\\/04\\\/blog-16-32.webp\",\"keywords\":[\"Bombay High Court\",\"cheque dishonour case\",\"Company Director\",\"Company Liquidation\",\"IBC\",\"Insolvency and Bankruptcy\",\"Justice B.V. 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