Liquidation protection under Section 32A bars further attachment once the liquidation sale is approved, preserving the estate.

A writ petition challenging interference with a liquidation process was not rendered infructuous by a later provisional attachment under the Prevention of Money Laundering Act, 2002, because the core challenge to the respondent's jurisdiction to obstruct the liquidation estate remained live. In liquidation under the Insolvency and Bankruptcy Code, 2016, the statutory bar under Section 32A was held to operate once the Adjudicating Authority approved the liquidation mode of sale under Regulation 32; from that point, further attachment or coercive action against the corporate debtor's liquidation assets could not continue, and the sale certificate or other ministerial steps were not the ative trigger.

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Issues: (i) Whether the writ petition became infructuous or was otherwise not maintainable after a provisional attachment order was issued under the Prevention of Money Laundering Act, 2002. (ii) Whether, in liquidation proceedings under the Insolvency and Bankruptcy Code, 2016, the respondent could continue to proceed against the corporate debtor's properties despite the approval of the liquidation sale by the Adjudicating Authority.

Issue (i): Whether the writ petition became infructuous or was otherwise not maintainable after a provisional attachment order was issued under the Prevention of Money Laundering Act, 2002.

Analysis: The reliefs sought were directed against interference with the liquidation process and against coercive action in respect of the liquidation estate. The subsequent provisional attachment did not extinguish the challenge to the respondent's jurisdiction to obstruct the liquidation process, nor did it bar adjudication merely because no separate challenge had been laid to the attachment order. The petition therefore survived for decision.

Conclusion: The preliminary objection was rejected against the respondent.

Issue (ii): Whether, in liquidation proceedings under the Insolvency and Bankruptcy Code, 2016, the respondent could continue to proceed against the corporate debtor's properties despite the approval of the liquidation sale by the Adjudicating Authority.

Analysis: The Insolvency and Bankruptcy Code and the Prevention of Money Laundering Act operate in distinct fields, but the Court held that the specific protection under Section 32A of the Insolvency and Bankruptcy Code governs the point at which action against the corporate debtor's property must cease. The legislative purpose is to protect the liquidation or resolution process from being defeated by later enforcement action and to preserve value for creditors and bona fide bidders. In liquidation, the decisive trigger is the Adjudicating Authority's approval of the mode of sale under Regulation 32 of the Liquidation Process Regulations, and not the later issuance of a sale certificate or full completion of ministerial formalities. Once the sale as a going concern was approved, the bar under Section 32A operated and further attachment or coercive action against the liquidation estate could not continue.

Conclusion: The respondent could not proceed further against the liquidation estate after approval of the liquidation sale, and the bar under Section 32A applied in favour of the petitioner.

Final Conclusion: The liquidation process was permitted to continue under the Insolvency and Bankruptcy Code, and enforcement action against the corporate debtor's liquidation assets was held to be barred once the liquidation sale had been approved.

Ratio Decidendi: In liquidation, the statutory bar under Section 32A of the Insolvency and Bankruptcy Code, 2016 takes effect when the Adjudicating Authority approves the liquidation mode of sale, thereby foreclosing further attachment or coercive action against the corporate debtor's properties in respect of pre-CIRP offences.

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