Case Law Details
Packwell (India) Ltd. Vs Emgee Cables And Communication Ltd (Himachal Pradesh High Court)
Himachal Pradesh High Court held that PMLA [Prevention of Money Laundering Act, 2002] would cease the power to attach the property when the order of liquidation has already been passed.
Facts- This Interlocutory Application (‘IA’) bearing the IA No. 15/JPR/2022 is filed by Mr. Satyendra P. Khorania (‘Applicant’), the Liquidator of the Corporate Debtor, M/s Emgee Cables and Communication Limited (‘ECCL’) under Section 35(1)(n) of Insolvency and Bankruptcy Code, 2016 (the ‘IBC’/ ‘Code’) and r/w Rule 11 of NCLT Rules for seeking directions to carry out the auction of properties of the Corporate Debtor which are attached by the order of Deputy Director, Directorate of Enforcement (‘Respondent’)
Conclusion- Held that PMLA would cease to have the power to attach the property at this juncture when the order of the Liquidation has already been passed.
Thus, the IBC [Insolvency and Bankruptcy Code, 2016] creates a specific bar with respect to proceedings that may be initiated under the PMLA [Prevention of Money Laundering Act, 2002] by virtue of the provisions contained in Section 32A. Moreover, Section 32A cannot possibly be read as being applicable prior to a Resolution Plan being approved or a liquidation measure being enforced. Further, it can therefore be construed that the objective and intention of the Code is providing a free hand to the creditors if the properties of the Corporate Debtor are attached then it will jeopardize the Liquidation Process.
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