# In the matter of Vishnoo Mittal vs. Shakti Trading Company

> SC judgment dated 2025-03-17. Citation: TCN-2025-SC-00036. The case involves an appeal against an order of the Punjab and Haryana High Court, which dismissed…

- **Court:** SC
- **Order date:** 17 Mar 2025
- **Citation:** TCN-2025-SC-00036
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/supreme-court-of-india/vishnoo-mittal-vs-shakti-trading-company-05711b20

## Summary

### Background

The case involves an appeal against an order of the Punjab and Haryana High Court, which dismissed the appellant's petition seeking to quash proceedings initiated under Section 138 of the Negotiable Instruments Act, 1881. The appellant, a director of M/s Xalta Food and Beverages Private Limited (the corporate debtor), was facing proceedings due to dishonored cheques issued to M/s Shakti Trading Company (the respondent). Insolvency proceedings had commenced against the corporate debtor, and a moratorium was imposed under Section 14 of the Insolvency and Bankruptcy Code, 2016 (IBC). The appellant argued that the proceedings under Section 138 of the NI Act could not have been initiated against him due to the moratorium.

## Facts

Vishnoo Mittal, the appellant, was a director of M/s Xalta Food and Beverages Private Limited, referred to as the 'corporate debtor'. The corporate debtor had a business relationship with M/s Shakti Trading Company, the respondent, where the respondent acted as a super stockist. As part of this relationship, the appellant issued eleven cheques totaling Rs. 11,17,326/- to the respondent. These cheques were dishonored on 07.07.2018. The respondent issued a legal notice to the appellant under Section 138 of the Negotiable Instruments Act (NI Act) because the cheque amounts were not furnished. In September 2018, the respondent filed a complaint against the appellant under Section 138 of the NI Act. Meanwhile, on 25.07.2018, insolvency proceedings commenced against the

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## Issues and analysis

### Issue 1: Whether the proceedings under Section 138 of the Negotiable Instruments Act, 1881 can be initiated …

**Ratio:** The moratorium under Section 14 of the IBC bars proceedings against the corporate debtor

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**Reasoning:** The court reasoned that the High Court erred in relying on P. Mohan Raj because the facts

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

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**Application:** The court applied the ratio to the facts by noting that the moratorium was

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## Parties

- **Judges:** Sudhanshu…; Ahsanuddin…
- **Appellants:** Vishnoo M…
- **Respondents:** M/s Xalta Food…; M/S SHAKTI…
- **Other parties:** Over Tu…

## Timeline

- **2018-07-07 — Cheques Dis…**: Eleven cheques issued by the…
- **2018-07-25 — Insolvency Proceedings…**: Insolvency proceedings commenced against the corporate debtor, and a moratorium was…

## 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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