In Business disputes don’t go for Sec: 138 IPC when it is not needed

Been reading this Company Order passed by Delhi Bench of Company Law Board M/s.Uttrakhand Infra Structures & Dev Pvt.Ltd

When it comes to Non-Compliance of Court’s orders we have Contempt of Courts Act to enforce compliance, but when it comes to orders passed by Company Law Board we have Sec: 634A for the purposes of enforcement. The Application should be made under Section 634A of Companies Act 2013.

  1. In this case there was an MOU between the two parties (Respondents and Petitioners) that the former will pay the pending amount of 6.5cr before the agreed date.
  2. The cheque given by respondent has been dishonored.
  3. Now both parties have agreed to ahead with the attachment of property in question through execution proceedings before a Civil Court for which this order will be the basis.

It is indeed tempting to file a complaint under section 138 of Indian Penal Code for Dishonor of Cheque but we should not do as this will unnecessarily delay the whole resolution of issue. The first step should be to seek enforcement of order before CLB, It is only because this case involves attachment of immovable property it needed to go for Execution proceedings before a Civil Court otherwise CLB could have enforced it on its own.

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