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 judgment, decree or order in any court of law, tribunal, arbitration panel 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 Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 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.

 – For the purposes of this sub- section, it is hereby clarified that notwithstanding anything contained in any other law for the time being in force, a license, permit, registration, quota, concession, clearances or a similar grant or right given  by  the  Central  Government,  State Government, local authority, sectoral regulator or any other authority constituted under any other law  for the time being in force, shall not be suspended or terminated on the grounds of insolvency, subject to the condition that there is no default in payment of current dues  arising for the use or continuation of the license, permit, registration, quota, concession, clearances or a similar grant or right during the moratorium period;

 

(2) The supply of or services to the corporate debtor as may be specified shall not be terminated or suspended or interrupted during moratorium period.

Where the interim resolution professional or resolution professional, as the case may be, considers the supply of goods or services  critical to protect and preserve the value of the corporate debtor and manage the operations or such corporate debtor as a going concern, then the supply of such goods or services shall 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 such transactions as may be notified by the Central Government in consultation with any financial sector regulator.

The provisions of sub-section (1) shall not apply to-

such transactions, agreements or other arrangements as may be notified by the Central Government in consultation with any financial sector regulator or any other authority;

(a) such transaction as may be notified by the Central Government in consultation with any financial regulator;

(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 any time during the corporate insolvency resolution process period, if the Adjudicating Authority approves the resolution plan under sub-section (1) of section 31 or passes an order for liquidation of corporate debtor under section 33, the moratorium shall cease to have effect from the date of such approval or liquidation order, as the case may be.

2.18.4. Insolvency and Bankruptcy Board of India (Pre-packaged Insolvency Resolution Process) Regulations, 2021

The essential goods and services referred to in sub-section (2) of section 14 shall mean-
(a) electricity;
(b) water;
(c) telecommunication services; and
(d) information technology services,
to the extent these are not a direct input to the output produced or supplied by the corporate debtor.

Explanation.- Water supplied to a corporate debtor will be essential supplies for drinking and sanitation purposes, and not for generation of hydro-electricity.

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IBC-Enforcement Notification [S.O.3594(E)] dated 30/11/2016

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Insolvency and Bankruptcy Code (Amendment) Ordinance, 2018 dated 06.06.2018 [repealed by the Insolvency and Bankruptcy Code (Second Amendment) Act, 2018 dated 17.08.2018 w.e.f., 06.06.2018]

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MCA Notification dated 03.10.2023 regarding Applicability of section 14(1) of IB Code, 2016

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MCA Notification dated 14.06.2023 regarding the applicability of provisions of Section 14(1) of the Insolvency and Banckruptcy Code, 2016

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The Insolvency and Bankruptcy Code (Amendment) Act, 2020 dated 13.03.2020 w.e.f. 28.12.2019

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The Insolvency and Bankruptcy Code (Amendment) Ordinance, 2019 dated 28.12.2019

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The Insolvency and Bankruptcy Code (Second Amendment) Act, 2018 dated 17.08.2018 w.e.f., 06.06.2018

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