Interim Moratorium Under IBC Section 96 Limits Creditor Actions to Specific Debt, Allows Auction of Separate Firm Assets.

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....The interim moratorium u/s 96 of the Insolvency and Bankruptcy Code (IBC) applies only to the specific debt for which Section 95 proceedings have been initiated against a personal guarantor. It does not extend to other debts or properties of the personal guarantor or entities they are associated with. The moratorium prohibits other creditors from initiating legal action regarding the specific debt, but does not bar creditors from enforcing their rights against separate properties or entities. The IBC provisions take precedence over other laws u/s 238. In this case, the moratorium covers only the personal guarantee and does not restrain the creditor from auctioning partnership firm assets, as the firm is a separate entity from the personal guarantor. The appeal against allowing the auction was dismissed.....