Limited contractual use rights do not equal possession under insolvency moratorium provisions for facility operations.

Section 14(1)(d) of the Insolvency and Bankruptcy Code did not prevent an expression of interest for appointing a new operation and maintenance contractor where the corporate debtor held only a contractual right to use, operate and maintain the facility. The agreements showed that ownership remained with the subsidiary and that the corporate debtor had no proprietary interest beyond limited operational rights. On that basis, mere permission to use the facility did not amount to occupation or possession for the purposes of the moratorium provision. The appointment process was not a recovery action against property occupied by the corporate debtor, and SARFAESI measures against the subsidiary did not make the process impermissible.

---

---

Issues: Whether an expression of interest issued for appointment of a new operation and maintenance contractor for the facility was barred by section 14(1)(d) of the Insolvency and Bankruptcy Code, 2016 on the ground that the facility was occupied by or in the possession of the corporate debtor.

Analysis: The facility agreements showed that the corporate debtor had only a contractual right to use, operate and maintain the facility, while ownership remained with the subsidiary. The agreements also made clear that the corporate debtor had no proprietary interest in the facility beyond that limited operational right. On that basis, mere permission to use the facility for operations did not amount to occupation or possession of the facility for the purpose of section 14(1)(d). The challenged expression of interest was therefore not a recovery action by an owner or lessor against property occupied by the corporate debtor, and the initiation of SARFAESI measures against the subsidiary did not render the appointment process impermissible.

Conclusion: Section 14(1)(d) did not bar the expression of interest or the appointment of another operation and maintenance contractor. The appeal failed.

Ratio Decidendi: For section 14(1)(d) to apply, the corporate debtor must be in occupation or possession of the property sought to be recovered; a limited contractual right to operate, maintain and use the facility, without ownership or proprietary possession, is insufficient.

---