Moratorium under insolvency law bars a lessor from recovering leased property in the corporate debtor's possession during CIRP.

During CIRP, a lessor cannot terminate the lease and recover possession of premises occupied by the corporate debtor because Section 14(1)(d) of the Insolvency and Bankruptcy Code bars recovery of property in the debtor's possession. The Tribunal noted that the impugned notice was issued while the moratorium was in force and that the corporate debtor remained in possession of the leased plot, so the lessor's attempt to seek possession fell within the moratorium prohibition. It also applied Section 238 to hold that the Code prevails over inconsistent provisions of other laws. The application succeeded, and coercive steps against the leased property were restrained pending resolution plan approval.

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Issues: Whether the lessor could terminate the lease and take possession of the leased plot during the corporate insolvency resolution process, and whether such action was barred by the moratorium under the Insolvency and Bankruptcy Code, 2016.

Analysis: The Application was under Section 60(5)(c) of the Insolvency and Bankruptcy Code, 2016. The record showed that the impugned notice was issued during the subsistence of the corporate insolvency resolution process and that the corporate debtor was in possession of the leased premises. The Tribunal applied Section 14(1)(d) and held that recovery of property occupied by or in possession of the corporate debtor is prohibited during moratorium. The Tribunal also relied on the principle that Section 238 gives the Code overriding effect where there is inconsistency with other laws. The authorities cited by the lessor were found not to govern the facts, and the later notice seeking possession during CIRP was held to fall within the moratorium bar.

Conclusion: The lessor's action in seeking termination and possession during CIRP was hit by Section 14(1)(d) of the Code and was not permitted.

Final Conclusion: The application succeeded and the lessor was restrained from taking coercive steps in respect of the leased property while the resolution plan approval proceeding remained pending.

Ratio Decidendi: During CIRP, an owner or lessor cannot recover property that is occupied by or in the possession of the corporate debtor, and the Code prevails over inconsistent provisions of other laws by virtue of Section 238.

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