Moratorium under the Insolvency Code bars continuation of appellate proceedings; appeals treated as infructuous, revival permitted later.

Initiation of corporate insolvency resolution process (CIRP) and the statutory moratorium under the Insolvency and Bankruptcy Code prevent continuation of appellate proceedings; accordingly the Tribunal treated the pending appeals as infructuous. The analysis emphasises that an approved resolution plan becomes binding on the corporate debtor and stakeholders and that the Code has overriding effect over inconsistent laws, with claims outside an approved plan effectively extinguished. The decision permits parties to seek revival of proceedings if the resolution plan is not approved or on conclusion of CIRP subject to applicable limitation principles.

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Issues: Whether the appeals before the Tribunal can continue or must be dismissed as infructuous in view of the initiation of corporate insolvency resolution process (CIRP) and the moratorium under the Insolvency and Bankruptcy Code, 2016.

Analysis: The Tribunal examined the effect of an admitted petition under section 9 of the Insolvency and Bankruptcy Code, 2016 leading to initiation of CIRP and enforcement of moratorium under section 14 of the Insolvency and Bankruptcy Code, 2016. The Tribunal relied on the legal framework that an approved resolution plan under section 31(1) of the Insolvency and Bankruptcy Code, 2016 becomes binding on the corporate debtor and stakeholders and that section 238 of the Insolvency and Bankruptcy Code, 2016 provides the Code an overriding effect over inconsistent provisions of other laws. Prior decisions of coordinate benches and higher courts establishing that proceedings against a corporate debtor are prohibited during the moratorium and that claims not part of an approved resolution plan stand extinguished were applied. The Tribunal also noted that limitation for revival may be impacted as per section 60(6) of the Insolvency and Bankruptcy Code, 2016 and related precedent, permitting revival applications after the conclusion of CIRP where appropriate.

Conclusion: The appeals are dismissed as infructuous because CIRP has commenced and moratorium under the Insolvency and Bankruptcy Code, 2016 prevents continuation of the proceedings before the Tribunal; the parties are permitted to seek revival of the appeals if the resolution plan is not accepted or on conclusion of CIRP within the permissible limitation.

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