The moratorium declared under section 14 of the IBC also prevents the Adjudicating Officer (SEBI) from determining the liability of the Corporate Debtor for the alleged non-compliance of the LODR Regulations & other Rules – Dewan Housing Finance Corporation Ltd. Vs. Securities and Exchange Board of India – SAT Mumbai
SAT held that where a moratorium has been declared under section 14 of IBC, the authority which in the instant case is SEBI/AO will have no jurisdiction to institute any proceedings. Where a proceeding has already been instituted and during the pendency of the proceedings a moratorium order is passed under section 14 then the authority is prohibited from continuing with the proceedings. This is clear from a bare reading of the provisions of section 14(1) of the IBC. The provision of section 14 is very clear and explicit and there is no room for any ambiguity. Further, the Supreme Court has categorically explained the effect of section 14 of the IBC. The adjudicating officer could not have considered the report of the insolvency committee to come to the conclusion that he had the power to proceed under SEBI law inspite of a moratorium having come into effect under section 14 of the IBC.