SARFAESI Proceedings Cannot Be Continued Against Corporate Debtor Once CIRP Is Admitted And Moratorium Is Ordered: Supreme Court
2 years, 7 months ago

SARFAESI Proceedings Cannot Be Continued Against Corporate Debtor Once CIRP Is Admitted And Moratorium Is Ordered: Supreme Court

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The Supreme Court observed that the proceedings under the SARFAESI Act cannot be continued once the CIRP is initiated and the moratorium is ordered.The bench comprising Justices L. Nageswara Rao and B R Gavai noted that, in such a situation, any action to foreclose, recover or enforce any security interest created by the Corporate Debtor in respect of its property including any action under. The bench comprising Justices L. Nageswara Rao and B R Gavai noted that, in such a situation, any action to foreclose, recover or enforce any security interest created by the Corporate Debtor in respect of its property including any action under the SARFAESI Act is prohibited. Referring to Section 14 and 238 of the IBC, the court observed: After the CIRP is initiated, there is moratorium for any action to foreclose, recover or enforce any security interest created by the Corporate Debtor in respect of its property including any action under the SARFAESI Act. While dismissing the appeal, the bench observed: In view of the provisions of Section 14 of the IBC, which have overriding effect over any other law, any action to foreclose, recover or enforce any security interest created by the Corporate Debtor in respect of its property including any action under the SARFAESI Act is prohibited.

History of this topic

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