TMI Blog2022 (11) TMI 1282X X X X Extracts X X X X X X X X Extracts X X X X ..... rium has been declared. Section 96(1)(b) cannot be read to mean that any future liability or obligation is contemplated to be stayed. Thus, stay of proceedings under Section 19(2) and Section 66-67 is not contemplated under Section 96(1)(b) and the scheme of Code in no matter provide for stay of such applications. The Adjudicating Authority did not commit any error in rejecting application of the Appellants praying for stay of proceedings under Section 19(2) and Section 66-67. Hon ble Supreme Court in STATE BANK OF INDIA VERSUS V. RAMAKRISHNAN AND ANR. [ 2018 (8) TMI 837 - SUPREME COURT ], where the Hon ble Supreme Court had occasion to consider Section 96 and Section 101 with Section 14 and it was observed that Section 14 cannot be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the IRP under Section 19 sub-section (2) on 04.12.2019 against the Appellants who were Suspended Directors of the Corporate Debtor. Another application was filed by the Resolution Professional on 23.07.2020 being I.A. No. 3504 of 2020 under Section 66 and 67 of the I B Code. Proceedings under Section 95 were initiated against the Appellants as a Personal Guarantor for Advance Surfactants India Ltd. by order dated 06.12.2021 and 07.12.2021. Consequently, the interim moratorium was kicked in the said proceedings. An application was filed by the Appellants in CP (IB) 1023/ND/2018, which was Section 9 application, for stay of proceeding under Section 19(2) as well as under Section 66 and 67, which has been rejected. Aggrieved by the said or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate of the application in relation to all the debts and shall cease to have effect on the date of admission of such application; and (b) during the interim-moratorium period- (i) any legal action or proceeding pending in respect of any debt shall be deemed to have been stayed; and (ii) the creditors of the debtor shall not initiate any legal action or proceedings in respect of any debt. 7. The expression used in Section 96(1)(b)(i) is any legal action or proceeding pending in respect of any debt shall be deemed to have been stayed . 8. The term debt has been defined in the I B Code in Section 3(11), which is to the following effect: 3(11). debt means a liability or obligation in respect of a claim which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... This contention cannot be accepted for the reason that these two provisions are independent, incorporated for different purposes. Section 14 of IBC is intended to prevent fictitious claims by 3rd parties to realise the amount by execution of the orders decrees etc. whereas Section 66 of IBC is intended to prevent fraudulent trading or business by corporate debtor through its corporate insolvency resolution professional or suspended directors, during insolvency resolution process or liquidation process. These two provisions have to be read independently to achieve the object of the enactment. 15. While interpreting the provisions, the statute must be construed to make it effective and workable. The Courts/ Tribunals strongly lean agai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ilash Chandra Vs. Mukundi Lal6. between two sections of the same Act and, whenever it is possible to do so, to construe provisions which appear to conflict so that they harmonise vide University of Allahabad Vs. Amritchand Tripathi7 Accordingly, the provisions of the Maharashtra Regional and Town Planning Act, 1966, were read together by the Supreme Court after noting the purpose of the Act. The Act was held not to envisage a situation of conflict, and therefore, the edges were required to be ironed out to read those provisions of the Act which were slightly incongruous, so that all of them are read in consonance with the object of the Act, which is to bring about orderly and planned development vide Manohar Joshi Vs. State of Maharashtra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble Supreme Court in (2018) 17 SCC 394, State Bank of India vs. V. Ramakrishnan Anr. , where the Hon ble Supreme Court had occasion to consider Section 96 and Section 101 with Section 14 and it was observed that Section 14 cannot be possibly apply to a personal guarantor. In para 26 following has been observed: 26. We are also of the opinion that Sections 96 and 101, when contrasted with Section 14, would show that Section 14 cannot possibly apply to a personal guarantor. When an application is filed under Part III, an interim-moratorium or a moratorium is applicable in respect of any debt due. First and foremost, this is a separate moratorium, applicable separately in the case of personal guarantors against whom insolvency resolut ..... X X X X Extracts X X X X X X X X Extracts X X X X
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