TaxTMI 
TaxTMI 
2019 (1) TMI 872
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....etition in this Court, an interim order has been passed on 15.10.2018 by Appellate Tribunal in Company Appeal (AT) Nos. 346 and 347 of 2018. Petitioner, for insisting its prayer to stay present proceedings, has referred directions contained in interim stay order passed by Appellate Tribunal which reads as under:- "(i) The institution or continuation of suits or any other proceedings by any party or person or Bank or Company, etc. against 'IL&FS' and its 348 group companies in any Court of Law/Tribunal/Arbitration Panel or Arbitration Authority; and (ii) Any action by any party or person or Bank or Company, etc. to foreclose, recover or enforce any security interest created over the assets of 'IL&FS' and its 348 group companies including any action under the Securitization and Reconstruction of any Financial Assets and Enforcement of Security Interest Act, 2002; (iii) The acceleration, premature withdrawal r other withdrawal, invocation of any term loan, corporate loan, bridge loan, commercial paper, debentures, fixed deposits, guarantees, letter of support, commitment or comfort and other financial facilities or obligations vailed by 'IL&FS' and its 348 group companies whethe....
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....dispute between the parties, if any with respect to the main contract of the work, can be decided independently in terms thereof by the Arbitrator or a Court as the case may be. In nutshell, respondent intends to invoke bank guarantee against the petitioner, which is being opposed by the petitioner till final adjudication of dispute between the parties and vide order dated 27.2.2018 respondents have been restrained from invoking/encashing the bank guarantee till further orders. Adjournment of present proceedings sine die will amount to continuation of restraint order for an indefinite period, without adjudication of the petition on merits, which would definitely have an adverse effect on the financial claim of the respondent. 7. Order dated 15.10.2018 passed by Appellate Tribunal is not an order passed under Section 14 of the Code, but this order has been passed pending consideration the issues framed by Appellate Tribunal, which are as under:- "(i) Whether the Tribunal can pass appropriate order under Section 241 read with Section 242 of the Companies Act, 2013 for resolution of the problems faced by the Company in a time-bound manner for maximization of value of assets of the ....
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....includes a financial debt and operational debt; 14. Moratorium.---(1) Subject to provisions of sub-sections (2) and (3), on the insolvency commencement date, the Adjudicating Authority shall by order declare moratorium for prohibiting all of the following, namely:- (a) the institution of suits or continuation of pending suites or proceedings against the corporate debtor including execution of any judgment, decree or order in any court of law, tribunal, arbitration penal or other authority; (b) transferring, encumbering, alienating or disposing of by the corporate debtor any of its assets or any legal right or beneficial interest therein; (c) any action to foreclose, recover or enforce any security interest created by the corporate debtor in respect of its property including any action under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (54 of 2002); (d) the recovery of any property by an owner or lessor where such property is occupied by or in the possession of the corporate debtor. (2) The supply of essential goods or services to the corporate debtor as may be specified shall not be terminated or suspended or i....
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....tinue. I am in agreement with the view of learned Single Judge of Delhi High Court, expressed in Power Grid Corporation of India Ltd. case referred supra, wherein it is held that moratorium will not prohibit proceedings, continuation of which is beneficial to the corporate debtor. 14. In present case, respondent is undisputedly a corporate debtor, as defined in Section 3(8) of the Code, in the proceedings before Appellate Tribunal. But interim order dated 15.10.2018 passed by Appellate Tribunal is not an order passed under Section 14 of the Code. However, it is explicit from the interim order dated 15.10.2018 passed by the Appellate Tribunal that though moratorium has not been declared with respect to respondent Company, but the interim directions are identical to the provisions of Section 14 of the Code. Therefore, the principle that declaration of moratorium will not cause to stay the proceedings beneficial to corporate debtor, are also applicable in the present case. 15. In order dated 15.10.2018, Appellate Tribunal has appreciated the difficulties which are being faced by the IL&FS (respondent herein) and its 348 Group companies and at the time of passing of interim directio....