# in the matter of Schweitzer Systemtek India Pvt. Ltd. Vs. Phoenix ARC Pvt. Ltd. & Ors. CA (AT) No. 129-2017

> NCLAT judgment dated 2017-08-09. Citation: TCN-2017-NCLAT-00138. The Appellant-Corporate Applicant challenged the order dated 3rd July, 2017, passed by the…

- **Court:** NCLAT
- **Order date:** 9 Aug 2017
- **Citation:** TCN-2017-NCLAT-00138
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/schweitzer-systemtek-india-pvt-ltd-vs-phoenix-arc-pvt-ltd-ors-ca-f9a3e88f

## Summary

### Background

The Appellant-Corporate Applicant challenged the order dated 3rd July, 2017, passed by the Adjudicating Authority (National Company Law Tribunal) Mumbai Bench, Mumbai, which admitted the application preferred by the appellant under Section 10 of the Insolvency and Bankruptcy Code, 2016, passed a moratorium order, and ordered the appointment of an Insolvency Resolution Professional. The appellant's grievance is that the movable and immovable property of the Guarantor (promoter) has been attached pursuant to the Corporate Resolution Process initiated under section 10 against the Appellant-Corporate Applicant.

## Facts

The Appellant-Corporate Applicant filed an application under Section 10 of the Insolvency and Bankruptcy Code, 2016. The Adjudicating Authority admitted the application, declared a moratorium, and appointed an Insolvency Resolution Professional. The appellant's grievance was the attachment of the Guarantor's property. The Adjudicating Authority interpreted Section 14 of the I&B Code, specifically the term 'its,' to mean the property owned by the Corporate Debtor. The appellant argued that the moratorium should extend to assets relating to matters pending before the Debt Recovery Tribunal (DRT) and under the SARFAESI Act. The Appellate Tribunal considered the interpretation of Section 14 and the applicability of the SARFAESI Act.

## Issues and analysis

### Issue 1: Whether the moratorium under Section 14 of the Insolvency and Bankruptcy Code, 2016, extends to …

**Ratio:** The term 'its' in Section 14 refers to the property owned by the Corporate Debtor. The

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**Reasoning:** The Adjudicating Authority's interpretation of Section 14, specifically the term 'its,'

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**Interpretation:** Section 14(1)(c) of the I&B Code imposes a moratorium on actions to recover

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**Application:** In this case, the appellant argued that the moratorium should extend to the

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## Parties

- **Judges:** S.J. Mukhop…; Balvinder…
- **Appellants:** Schweitzer…
- **Respondents:** Phoenix ARC Pvt.…
- **Advocates:** Davesh B…; Rishad A.…; +1 more

## Timeline

- **2017-07-03 — Order by Adjudicating…**: The Adjudicating Authority (National Company Law Tribunal) Mumbai Bench passed an order…
- **2017-08-09 — Order by Appellate…**: The Appellate Tribunal dismissed the appeal,…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 10 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-10)

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