# In the matter of Anju Agarwal. R.P. for Shree Bhawani Paper Mills Ltd. Vs. Bombay Stock Exchange & Ors. CA(AT)(Insolvency) 734-2018

> NCLAT judgment dated 2019-04-23. Citation: TCN-2019-NCLAT-00642. The case involves an appeal against an order dated 10th September 2018, passed by the…

- **Court:** NCLAT
- **Order date:** 23 Apr 2019
- **Citation:** TCN-2019-NCLAT-00642
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/anju-agarwal-rp-for-shree-bhawani-paper-mills-ltd-vs-bombay-stock-exchange-ors-c-03bd0e60

## Summary

### Background

The case involves an appeal against an order dated 10th September 2018, passed by the Adjudicating Authority (National Company Law Tribunal), Allahabad Bench, Allahabad, in Company Petition No. (IB)/110/ALD/2017 and CA No. 100/2018. The appellant, the Resolution Professional of Shree Bhawani Paper Mills Ltd. (Corporate Debtor), challenged the order. The Adjudicating Authority held that Regulatory Authorities are not covered under the ‘Moratorium’ as provided under Section 14 of the Insolvency and Bankruptcy Code, 2016.

## Facts

The Resolution Professional of Shree Bhawani Paper Mills Ltd. (Corporate Debtor) appealed against an order by the Adjudicating Authority (NCLT Allahabad) which stated that regulatory authorities are not covered by the moratorium under Section 14 of the Insolvency and Bankruptcy Code (I&B Code). The appellant argued that the moratorium should prevent the Bombay Stock Exchange (BSE) from suspending trading shares of the Corporate Debtor and that SEBI regulations should not apply during the moratorium. The BSE, as the respondent, argued that Section 14 does not apply to them and that they can take actions under the SEBI Act, 1992. The appellant also cited a Supreme Court decision stating that proceedings against the Corporate Debtor cannot proceed once a moratorium is

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## Issues and analysis

### Issue 1: Whether Regulatory Authorities are covered under the ‘Moratorium' as provided under Section 14 of …

**Ratio:** Section 14 of the I&B Code provides for a moratorium during the insolvency resolution

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**Reasoning:** The court reasoned that Section 238 of the I&B Code has an overriding effect over

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**Interpretation:** The interpretation of Section 14 involves determining whether its scope extends

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**Application:** The court applied the ratio by holding that SEBI and BSE cannot recover any

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## Parties

- **Judges:** S.J. Mukhop…; A.I.S. C…; +1 more
- **Appellants:** Anju Ag…
- **Respondents:** SHREE BHAWANI…; Bombay Stock…
- **Advocates:** Anant A.…; A. An…; +6 more

## Timeline

- **2018-09-10 — Order by Adjudicating…**: The Adjudicating Authority (National Company Law Tribunal), Allahabad Bench, passed an…
- **2019-04-23 — NCLAT Or…**: The NCLAT modified and clarified the impugned order, stating that Section 14 of the I&B…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 14 — Moratorium](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-14)

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