Admiralty action in rem is distinct from company proceedings, and maritime claims need not seek winding-up leave before proceeding.

An admiralty action in rem against a vessel is not a proceeding against the corporate debtor, so its institution is not barred by the IBC moratorium; however, continuation must yield where it would frustrate CIRP, while liquidation permits the admiralty process to proceed and maritime priorities to be worked out under the Admiralty Act. Leave under Section 446(1) of the Companies Act, 1956 is not required to commence or continue an admiralty action in rem, because that provision applies to proceedings against the company, whereas admiralty jurisdiction is vested exclusively in the designated High Court and is governed by the later, special maritime statute.

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Issues: (i) Whether an action in rem under the Admiralty (Jurisdiction and Settlement of Maritime Claims) Act, 2017 conflicts with the moratorium and liquidation regime under the Insolvency and Bankruptcy Code, 2016, and if so, how the conflict is to be resolved; (ii) Whether leave under Section 446(1) of the Companies Act, 1956 is required for the commencement or continuation of an Admiralty action in rem where a winding up order has been made or the Official Liquidator has been appointed as Provisional Liquidator.

Issue (i): Whether an action in rem under the Admiralty (Jurisdiction and Settlement of Maritime Claims) Act, 2017 conflicts with the moratorium and liquidation regime under the Insolvency and Bankruptcy Code, 2016, and if so, how the conflict is to be resolved.

Analysis: An action in rem is directed against the vessel as a distinct juridical entity and not against the corporate debtor personally. The Admiralty Act constitutes a self-contained code governing arrest, detention, sale of vessels and priority of maritime claims, while the Insolvency and Bankruptcy Code is a comprehensive code for insolvency resolution and liquidation of corporate debtors. The apparent conflict is resolved by harmonising both enactments: institution of an admiralty action in rem is not barred by the moratorium because it is not a proceeding against the corporate debtor, but the action cannot be permitted to proceed after arrest in a manner that frustrates the corporate insolvency resolution process. If the vessel is under arrest and liquidation follows, the secured character of the maritime claimant is recognised and the Admiralty Act governs enforcement and distribution of sale proceeds. If security has been furnished and the owner appears, the proceeding may assume an in personam character and the insolvency regime then applies to that extent.

Conclusion: The Admiralty action in rem is not barred at the stage of institution, but its continuation must yield to the moratorium during CIRP; upon liquidation, the admiralty process may continue and priorities are to be determined under the Admiralty Act.

Issue (ii): Whether leave under Section 446(1) of the Companies Act, 1956 is required for the commencement or continuation of an Admiralty action in rem where a winding up order has been made or the Official Liquidator has been appointed as Provisional Liquidator.

Analysis: Section 446 is directed to suits and proceedings against the company, whereas an Admiralty action in rem is against the ship and not against the company or its assets in the ordinary sense. The Admiralty Act vests exclusive jurisdiction in specified High Courts and the Company Court cannot itself assume admiralty jurisdiction under Section 446(2). Since the Admiralty Act is the later and special enactment governing maritime claims, arrest and sale of vessels, the winding up leave requirement cannot be applied so as to compel admiralty claimants to seek leave before invoking the admiralty forum. Priority among claimants from sale proceeds remains governed by the Admiralty Act, and the Official Liquidator's role arises only in relation to any residual amount or the company's interest after satisfaction of maritime claims.

Conclusion: Leave under Section 446(1) of the Companies Act, 1956 is not required for commencement or continuation of an Admiralty action in rem against the vessel.

Final Conclusion: Admiralty rights in rem were preserved as a distinct maritime remedy, while the insolvency and winding up regimes were accommodated only to the extent necessary to prevent interference with corporate resolution and liquidation. The maritime claimant may invoke the admiralty forum, and the ranking of claims against the vessel or its sale proceeds is to be worked out under admiralty law.

Ratio Decidendi: A proceeding in rem against a vessel is not a proceeding against the corporate debtor, and a special later admiralty statute governing exclusive maritime jurisdiction prevails over general company-law stay provisions, while the insolvency regime applies only to the extent necessary to prevent frustration of CIRP or liquidation.

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