M/S.KUSUM INGOTS & ALLOYS LTD. vs M/S.PENNAR PETERSON SECURITIES LTD.&ORS

The Supreme Court addressed whether a company and its Directors can be prosecuted under Section 138 of the Negotiable Instruments Act, 1881 after the company is declared sick under The Sick Industrial Companies (Special Provisions) Act, 1985 (SICA). The Court held that the provisions of SICA do not bar criminal proceedings under Section 138 NI Act, affirming that a prima facie case was established against the accused. Consequently, the appeals challenging the High Court's dismissal of quashing petitions were dismissed, allowing the criminal proceedings to continue.