TaxTMI 
TaxTMI 
2021 (5) TMI 732
X X X X Extracts X X X X
X X X X Extracts X X X X
....Bhardwaj, Advocate. ORDER Per: Janab Mohammed Ajmal, Member (Judicial) This is an Application by the Resolution Professional of the Corporate Debtor seeking certain directions against the Respondent inter alia not to proceed with any penalty proceedings against the Corporate Debtor. 2. Briefly stated the facts leading to the Application are thus: i. This Tribunal by order dated 31.01.2019 in the quoted Company Petition u/s 7 of the Insolvency and Bankruptcy Code, 2016 (the Code) initiated Corporate Insolvency Resolution Process (CIRP) of the Corporate Debtor. Thereunder this Authority appointed the Interim Resolution Professional (IRP) and inter alia declared moratorium u/s 14 of the Code. ii. In course of the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ith another notice dated 18.12.2015 granting a second opportunity to the Corporate Debtor as to why the order of eviction would not be passed. vi. No action was taken by the SEZ Authority till 05.09.2017. The Specified Officer of the Respondent on 05.09.2017 assessed that the Corporate Debtor was in arrears of Rs.. 2,98,37,311/- towards duty as per the Bond-cum-Legal Undertaking in terms of the SEZ Rules on the balance capital goods imported by it. Apparently, the Corporate Debtor did not comply with the notices. The Respondent on 11.02.2019 issued a notice u/s 11(2) of the Foreign Trade (Development and Regulations) Act, 1992 (the Foreign Trade Act) to the Corporate Debtor indicating various violations by the Corporate Debtor to s....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d circumstances of the instant case (wrongly mentioned as prayer (e) in the Application). 3. The Respondent in its reply submitted that the action initiated by him was much prior to the commencement of the CIRP process and upon receipt of the letter dated 26.02.2019 the Respondent on 11.06.2019 submitted its claim towards the Customs duty and Estate dues. Since the notice dated 11.02.2019 was issued prior to the Respondent becoming aware of the commencement of the CIRP, the action would not amount to the contravention of the moratorium. The proceedings contemplated under the notice dated 11.02.2019 had remained unadjudicated and no proceedings has been taken up. Since there is no contravention of the provisions of the Code the Applicatio....
X X X X Extracts X X X X
X X X X Extracts X X X X
....under: "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 suits or proceedings against the corporate debtor including execution of any judgement, decree or order in any court of law, tribunal, arbitration panel or other authority; (b) transferring, encumbering, alienating or disposing off 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 de....
X X X X Extracts X X X X
X X X X Extracts X X X X
....hall not be terminated, suspended or interrupted during the period of moratorium, except where such corporate debtor has not paid dues arising from such supply during the moratorium period or in such circumstances as may be specified.] [(3) The provisions of sub-section (1) shall not apply to - [(a) such transactions, agreements or other arrangement as may be notified by the Central Government in consultation with any financial sector regulator or any other authority;] (b) a surety in a contract of guarantee to a corporate debtor.] (4) The order of moratorium shall have effect from the date of such order till the completion of the corporate insolvency resolution process: Provided that where at an....
X X X X Extracts X X X X
X X X X Extracts X X X X
....erms of section 14(1)(d) of the Code. Therefore, neither the proceedings for recovery of the dues nor the proceedings for recovery of possession of the allotted premises can be allowed to continue or any proposed action in that regard can be sustained during the currency of the CIRP. 8. The referred decision in Varrsana Ispat Ltd. (supra) relates to a penal action of 'proceeds of crime' under the Prevention of Money Laundering Act, 2002. This would accordingly be neither relevant nor applicable to the case at hand. Similarly, the decisions in Shah Brothers (supra) and Mr Ajay Kumar Bishnoi (supra) relate to prosecution u/s 138 of the Negotiable Instruments Act, 1881 and accordingly would not be relevant for our purpose. 9. In any case....