# In the matter of Leo Meridian Infrastructure Projects and Hotels Ltd. IA No. 54-2020 in CP IB No.43-7-HDB-2018

> NCLT judgment dated 2020-05-06. Citation: TCN-2020-NCLT-01373. The case involves an application filed by the Resolution Professional (RP) of Leo Meridian…

- **Court:** NCLT
- **Order date:** 6 May 2020
- **Citation:** TCN-2020-NCLT-01373
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/leo-meridian-infrastructure-projects-and-hotels-ltd-ia-no-54-2020-in-cp-ib-no43-429e78a3

## Summary

### Background

The case involves an application filed by the Resolution Professional (RP) of Leo Meridian Infrastructure Projects & Hotels Ltd, the corporate debtor, seeking the removal of a provisional attachment order (PAO) issued by the Enforcement Directorate (ED) under the Prevention of Money Laundering Act (PMLA). The PAO was issued against the corporate debtor's assets, including land, buildings, and capital works, based on an ECIR (Enforcement Case Information Report) related to alleged money laundering. The RP argues that the PAO violates the moratorium imposed under Section 14 of the Insolvency and Bankruptcy Code (IBC) after the corporate debtor was admitted into Corporate Insolvency Resolution Process (CIRP). The ED contends that the PAO is valid, as it relates to

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## Facts

Leo Meridian Infrastructure Projects & Hotels Ltd (LMIPHL) is a corporate debtor undergoing Corporate Insolvency Resolution Process (CIRP) under the Insolvency and Bankruptcy Code (IBC). The CIRP was initiated vide order dated 2019-04-09. An Interim Resolution Professional (IRP) was initially appointed, later replaced by Raj Kumar Ralhan as the Resolution Professional (RP). The Enforcement Directorate (ED) issued a Provisional Attachment Order (PAO) dated 2019-12-30, attaching the assets of LMIPHL under the Prevention of Money Laundering Act (PMLA). The PAO was based on an Enforcement Case Information Report (ECIR) related to alleged money laundering. The RP filed an application before the NCLT seeking the removal of the PAO, arguing that it violates the moratorium

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## Issues and analysis

### Issue 1: Whether the Provisional Attachment Order (PAO) issued by the Enforcement Directorate (ED) under the …

**Ratio:** The ratio is that the moratorium under Section 14 of the IBC prohibits any action to

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**Reasoning:** The court reasoned that the PMLA proceedings are distinct from the IBC proceedings, as

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**Interpretation:** The interpretation is that Section 14 of the IBC does not provide blanket

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**Application:** In this specific case, the court applied the ratio by holding that the PAO

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## Parties

- **Judges:** Ratakonda…; Narender Kumar…; +1 more
- **Appellants:** Andhra…
- **Respondents:** Leo Meridian…

## Timeline

- **2018-01-01 — CP (IB) No. 43/7/HDB/201…**: Company Petiti…
- **2019-04-09 — CIRP Commen…**: Corporate Debtor is under CIRP…

## 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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