# In the matter of Shree Nagani Silk Mills Pvt. Ltd. vs. L.D. Industries Ltd. and Ors.

> SC judgment dated 2025-09-02. Citation: TCN-2025-SC-00088. The case involves seven criminal appeals arising from identical judgments and orders of the Bombay…

- **Court:** SC
- **Order date:** 2 Sept 2025
- **Citation:** TCN-2025-SC-00088
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/supreme-court-of-india/shree-nagani-silk-mills-pvt-ltd-vs-ld-industries-ltd-and-ors-64f7f349

## Summary

### Background

The case involves seven criminal appeals arising from identical judgments and orders of the Bombay High Court, which impugned revisional court orders emanating from complaints filed by the appellant against the respondents under Section 138 of the Negotiable Instruments Act, 1881.

## Facts

The appellant filed complaints under Section 138 read with Section 141 of the N.I. Act against L.D. Textile Industries and four others for dishonor of cheques.

The accused company claimed it was declared 'SICK' by BIFR and was under a restraint order.

The cheques in question were allegedly issued in 2001, while the BIFR restraint order was dated 21.08.2000.

The High Court dismissed the appellant's petitions, leading to the appeals before the Supreme Court.

The Supreme Court considered the impact of Section 22 of SICA and Section 22A on proceedings under Section 138 of the N.I. Act.

## Issues and analysis

### Issue 1: Whether proceedings under Section 138 of the N.I. Act are barred against a 'SICK' company due to a …

**Ratio:** Section 22 of SICA does not create a legal impediment for instituting and proceeding with

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**Reasoning:** The Court relied on Kusum Ingots (supra) and Southern Steel Ltd. and Others vs. Jindal

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**Interpretation:** The Court interpreted Section 22A of SICA as not imposing an absolute bar on

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**Application:** The Court found that the High Court erred in relying on Kusum Ingots &

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## Parties

- **Judges:** Manoj M…; UJJAL B…
- **Appellants:** SHREE NAGANI SILK…
- **Respondents:** L.D. INDUSTRIES…; L.D. Industries…
- **Other parties:** Over Tu…
- **Advocates:** Ninad…; Rishi B…

## Timeline

- **2000-08-21 — BIFR Restrain…**: BIFR issued a restraint order…
- **2001-04-25 — Cheque Is…**: Cheques were allegedly…

## 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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