Interim moratorium and SARFAESI sale certificate stayed pending DRT decision on interim applications.

Interim moratorium under the Insolvency and Bankruptcy Code was raised as a bar against further SARFAESI enforcement steps after possession and auction of the secured asset, while the sale certificate had not yet been issued. The Bank stated it would defer issuance of the sale certificate until the pending interim applications before the DRT were heard and decided, and both sides undertook to cooperate without adjournments. In these circumstances, the HC directed the DRT to dispose of the interim applications on the next listed date and recorded that the Bank's statement would continue to operate until that decision.

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Issues: Whether, in view of the interim moratorium under Section 96 of the Insolvency and Bankruptcy Code, 2016 and the pending interim applications before the DRT, the Bank could be restrained from issuing the sale certificate and the DRT directed to decide the applications on a fixed date.

Analysis: The proceeding concerned steps taken under the SARFAESI framework after the asserted commencement of an interim moratorium. The secured asset had already been taken in possession and auctioned, but the purchaser had not yet been issued a sale certificate. The Bank, on instructions, stated that it would not issue the sale certificate until the interim applications pending before the DRT were heard and disposed of. Both sides also consented to cooperate and avoid adjournments so that the applications could be decided on the next listed date. In these circumstances, the Court directed the DRT to hear and dispose of the interim applications on the specified date and recorded that the Bank's statement would continue to operate pending that decision.

Conclusion: The Court granted interim protective directions, restrained issuance of the sale certificate until the DRT decided the pending interim applications, and disposed of the writ petition.

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