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TMI Blog2017 (10) TMI 567X X X X Extracts X X X X X X X X Extracts X X X X ..... Authority hereby appoint Shri Dushyant C. Dave, having address at 1101, Dalamal Tower, B Wing, Free Press Journal Marg, Nariman Point, Mumbai, and having Registration No. IBBI/IPA-003/IP-N00061/2017-18/10502 under Section 13(1) of the Code. 12. the Interim Insolvency Resolution Professional is hereby directed to cause public announcement of the initiation of "Corporate Insolvency Resolution Process" and call for submission of claims under Section 13(1)(b) read with Section 15 of the Code and Regulation 6 of Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. 13. This Adjudicating Authority hereby order moratorium under Section 13(1)(a) of the IB Code prohibiting the following as referred to in Section 14 of the Code. (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 t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding pending before us as well as the Adjudicating Authority is in the nature of civil proceeding. In support of his argument, he has referred the order of the Gujarat High Court- the details of which are mentioned in ground B of the Grounds of Appeal which reads as under: " The Learned Adjudicating Authority has failed to take into consideration the order dated 09.05.2014 in Special Criminal Application No. 1725 of 2014 the Hon"ble High Court of Gujarat has declared that the proceedings u/s 5, 8 and 17 of PML Act are civil in nature, the relevant paragraphs quoted herein after: "30. The main purpose of Section 5 appears to be provisional attachment of the properties where prosecution is intended. Conjoint reading of Section 5 and 8 clearly indicates their purpose being the prevention of money-laundering activity if such case is made out, by confiscating properties involved in Money-Laundering Act, either during pendency of prosecution or at the conclusion of the trial. Similarly, conjoint reading of Section 17 and 8 would indicate that its main purpose is to search and seize incriminating material in case where prosecution is intended and even in cases where it is not immedia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 5 and 8 are not in the nature of criminal proceeding, para 14 of the order passed by the Adjudicating Authority (NCLT) is not applicable in the said circumstances. 6. His second submission is that the Act Insolvency and Bankruptcy Code, 2016 is a Special Act which has an overriding effect then the PMLA Act, 2002. The Act was passed in 2016, subsequent to the act of PML Act in the decision of Supreme Court in the case of Solidaire India Ltd. V/s. Fair Growth Financial Services Ltd. & Ors. wherein after discussion in para 7-11 it was held that later enactment would prevail with a nonobstante clause. Paras 7-11 reads as under:- "7. Coming to the second question, there is no doubt that the 1985 Act is a special Act. Section 32(1) of the said Act reads as follows: "32. Effect of the Act on other laws.-(1) The provisions of this Act and of any rules or schemes made there under shall have effect notwithstanding anything inconsistent therewith contained in any other law except the provisions of the Foreign Exchange Regulation Act, 1973 (46 of 973) and the Urban Land (Ceiling and Regulation) Act, 1976 (33 of 1976) for the time being in force or in the Memorandum or Articles of As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng to Transactions in Securities) Act, 1992, provides in Section 13. that its provisions are to prevail over any other Act. Being a later enactment, it would prevail over the Sick Industrial Companies (Special Provisions) Act, 1985. Had the Legislature wanted to exclude the provisions of the Sick Companies Act from the ambit of the said Act, the Legislature would have specifically so provided. The fact that the Legislature did not specifically so provide necessarily means that the Legislature intended that the provisions of the said Act were to prevail even over the provisions of the Sick Companies Act. Under Section 3 of the 1992 Act, all properly of notified persons is to stand attached. Under Section 3(4), it is only the Special Court which can give directions to the Custodian in respect of property of the notified party. Similarly, under Section 11(1), the Special Court can give directions regarding property of a notified party. Under Section 11(2), the Special Court is to distribute the assets of the notified party in the manner set out thereunder. Monies payable to the notified parties are assets of the notified party and are, therefore, assets which stand attached. These ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion of the case, more so when we find that whenever the legislature wishes to do so it makes appropriate provisions in the Act in that behalf. Mr Shiraz Rustomjee has drawn our attention to Section 34 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 wherein after giving an overriding effect to the 1993 Act it is specifically provided that the said Act will be in addition to and not in derogation of a number of other Acts including the 198.5 Act. Similarly under Section 32 of the 1985 Act the applicability of the Foreign Exchange Regulation Act and the Urban Land (Ceiling and Regulation) Act is not excluded. It is clear that in the instant case there was no intention of the legislature to permit the 1985 Act to apply, notwithstanding the fact that proceedings in respect of a company may be going on before the BIFR. The 1992 Act is to have an overriding effect notwithstanding any provision to the contrary in another Act." Similar view was taken by the Bombay High Court in the case of Bhoruka Steel Ltd. Vs. Fairgrowth Financial Services Ltd. The judgment rendered on 09.02.2016 reported in 1997 (89) company cases 547 (BOM) para 15 of the said judgment read ..... X X X X Extracts X X X X X X X X Extracts X X X X
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