NCLT Blocks Shakti Bhog Snacks' Dissolution Amid Money Laundering Probe

The National Company Law Tribunal (NCLT) has rejected a plea to dissolve Shakti Bhog Snacks amid ongoing money laundering investigations by the Enforcement Directorate (ED). The tribunal stressed that insolvency proceedings under the Insolvency & Bankruptcy Code (IBC) cannot be used to bypass legal actions under the Prevention of Money Laundering Act (PMLA).

In its detailed order, the NCLT emphasized that allowing the company's dissolution would obstruct the ED's efforts to investigate, prosecute, and recover the proceeds of crime. The NCLT further highlighted that it does not possess the jurisdiction to interfere with PMLA proceedings, as reiterated by the Supreme Court.

The tribunal's decision underscores the complex intersection of insolvency and criminal proceedings, particularly when substantial fraud and money laundering accusations are involved. With assets attached and criminal liability still pending, Shakti Bhog Snacks remains under scrutiny as the case unfolds.

(With inputs from agencies.)