Section 32A(2) of Insolvency and Bankruptcy Code, 2016 provides immunity to the properties of the Corporate Debtor forming part of Resolution Plan approved under 31 of IBC from any action by any Authority – STCI Vs. DSK Southern Projects Pvt. Ltd. – NCLT Mumbai Bench
May 9, 2023
The Adjudicating Authority finds that the provisional order attaching the properties of the Corporate Debtor, subject matter of present application, came to be passed on 14.02.2019 and the Corporate Debtor was admitted to CIRP under Section 9 of the Insolvency and Bankruptcy Code,2016 from 21.12.2021 and the Corporate Debtor was resolved pursuant to order of this Bench dated 17.02.2023. The Hon’ble NCLAT in its order in the matter of the Directorate of Enforcement V/s. Shri. Manoj Kumar Agarwal (2021) ibclaw.in 182 NCLAT has held that the Enforcement Directorate cannot hold or encumber the property of Corporate Debtor upon commencement of CIRP in its case. This the Hon’ble Apex Court in the matter of Essar Steel India Ltd. v. Satish Kumar Gupta [2019] ibclaw.in 07 SC held that “hydra head popping up” should be prevented and emphasized that the prospective resolution Applicant, who successfully takes over the business of the Corporate Debtor, should be protected from any past claim from resurging and thereby throwing the resolution applicant into uncertainty. This prompted the legislation to insert Section 32A in the Code.