Section 7 insolvency applications remain maintainable despite liquidation proceedings; Section 11 does not bar financial creditor petitions.

An application under Section 7 of the Insolvency and Bankruptcy Code, 2016 remains maintainable despite pending winding-up or liquidation proceedings. The liquidation order and appointment of the Official Liquidator do not, by themselves, make a financial creditor's Section 7 application incompetent. Section 11 has a limited effect: it bars only a corporate debtor against whom a liquidation order has been made from initiating proceedings under Section 10, and it does not prevent a financial creditor from proceeding under Section 7 or an operational creditor under Section 9. The Section 7 proceeding is an independent action to be decided under the Code.

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Issues: Whether an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 was maintainable notwithstanding the pendency of winding up/liquidation proceedings and whether Section 11 of the Insolvency and Bankruptcy Code, 2016 barred such application.

Analysis: The liquidation order and appointment of the Official Liquidator did not by themselves render the financial creditor's Section 7 application incompetent. Section 11 has a limited operation and bars only a corporate debtor in respect of whom a liquidation order has been made from initiating proceedings under Section 10. That provision does not prohibit a financial creditor from filing an application under Section 7 or an operational creditor from filing under Section 9. The application before the Tribunal was an independent proceeding and had to be decided according to the Code.

Conclusion: The Section 7 application was maintainable and no interference with the admitted insolvency proceeding was warranted.

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