Date of Judgment: 15 January 2026
Coram: Hon’ble Mr. Justice Vikas Mahajan
Dentons Link Legal represented the erstwhile suspended directors of Future Retail Ltd. (the “Petitioners”) in quashing petitions before the High Court of Delhi in Ravindra Dhariwal & Anr. v. Kotak Mahindra Bank Ltd. & Anr. (CRL.M.C. 8417/2023) and Kishore Laxmnarayan Biyani & Anr. v. Kotak Mahindra Bank Ltd. & Anr. (CRL.M.C. 8431/2023), seeking quashing of the summoning order dated 24 January 2023 and the complaint filed under Section 138 of the Negotiable Instruments Act, 1881 titled Kotak Mahindra Bank Ltd. v. Future Retail Ltd. & Ors. (CC No. 3106/2022). The complaint arose from alleged dishonour of two cheques aggregating to approximately INR 53.48 crore issued by Future Retail Ltd. By judgment dated 15 January 2026, the Hon’ble Court allowed the petitions and quashed the summoning order as well as the complaint proceedings against the Petitioners.
The decision is significant as it reaffirms the legal position that once corporate insolvency resolution proceedings are initiated and a Resolution Professional is appointed, the management of the corporate debtor vests in the RP and the powers of the board stand suspended, including the ability to operate the corporate debtor’s bank accounts. In such circumstances, the erstwhile directors, who do not have control over the company’s affairs or bank accounts during the statutory notice period, cannot be subjected to vicarious criminal liability under Section 138 of the Negotiable Instruments Act for non-payment within the prescribed period. In reaching this conclusion, the Court relied on the Supreme Court’s decision in Vishnoo Mittal v. Shakti Trading Company (2025) 9 SCC 417 and held that continuation of the criminal proceedings against the Petitioners would not be sustainable in law.
The matter was handled by Dentons Link Legal Partner Petrushka Deas Dasgupta, Principal Associate Mridul Yadav, and Senior Associate Raghav Mittal, who represented the Petitioners before the Hon’ble Court.