PANKAJ MEHRA vs STATE OF MAHARASHTRA

The Supreme Court held that a company cannot evade penal liability under Section 138 of the Negotiable Instruments Act merely because a winding-up petition was pending at the time of the cheque's dishonor. The Court clarified that the presentation of a winding-up petition does not create a legal disability to make payments, and thus, the company remains liable for the cheque issued prior to the winding-up proceedings. The Court upheld the Bombay High Court's dismissal of writ petitions challenging the criminal proceedings against the company and its directors.