# In the matter of Ajay Vasant Tikekar vs. Geelon Industries Pvt. Ltd. Through Viral Kantilal Gajjar

> HC judgment dated 2023-09-27. Citation: TCN-2023-HC-00033. The case involves multiple criminal applications (quashing) filed under Articles 226 and 227 of the…

- **Court:** HC
- **Order date:** 27 Sept 2023
- **Citation:** TCN-2023-HC-00033
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/high-courts-new-delhi/ajay-vasant-tikekar-vs-geelon-industries-pvt-ltd-through-viral-kantilal-gajjar-f1f1ab1f

## Summary

### Background

The case involves multiple criminal applications (quashing) filed under Articles 226 and 227 of the Constitution of India read with Section 482 of the Code of Criminal Procedure, 1973, seeking to quash complaints related to dishonored cheques. The complaints are pending before the Additional Chief Judicial Magistrate, Surat, under Section 138 of the Negotiable Instruments Act. The petitioners argue that the cheques were issued as security and that a moratorium under Section 14 of the IBC was in effect, preventing proceedings against the corporate debtor. The respondent-complainant contends that the cheques were issued for repayment of advanced working capital and that the directors are vicariously liable.

## Facts

Ajay Vasant Tikekar filed multiple criminal applications to quash complaints against him related to dishonored cheques. The complaints were filed by Geelon Industries Pvt Ltd through Viral Kantilal Gajjar. The cheques were allegedly issued by the directors of Lakeland Chemicals (India) Ltd. as additional security under a Memorandum of Understanding (MOU). The petitioners argued that a corporate insolvency resolution process (CIRP) had commenced against Lakeland Chemicals, and a moratorium was in place under Section 14 of the IBC, preventing proceedings against the company. They also claimed the cheques were security cheques and could not be presented. The complainant argued that the cheques were issued for repayment of advanced working capital, and the directors are

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## Issues and analysis

### Issue 1: Whether the proceedings under Section 138 of the Negotiable Instruments Act can be initiated or …

**Ratio:** The moratorium under Section 14 of the IBC applies only to the corporate debtor and does

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**Reasoning:** The court relied on the judgments of the Hon'ble Apex Court, particularly the newly added

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**Interpretation:** Section 14 of the IBC imposes a moratorium on proceedings against the corporate

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**Application:** In this case, the moratorium under Section 14 of the IBC would apply only to

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## Parties

- **Judges:** SANDEEP N.…
- **Appellants:** AJAY VASANT…
- **Respondents:** Lakeland Chemicals…; GEELON INDUSTRIES…
- **Other parties:** Kohi…

## Timeline

- **2019-05-02 — MOU Exec…**: Memorandum of Understanding (MOU) executed between the complainant and the accused…
- **2019-09-23 — CIRP Commen…**: Corporate Insolvency Resolution Process (CIRP) commenced against Lakeland Chemicals…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 138 — Discharge order](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-138)

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