IBC: Mere Filing of Application u/s 7(1) Insufficient to Invoke Section 238 Bar

Sunflag Iron & Steel Co Ltd Vs J. Poonamchand & Sons (Bombay High Court) Bombay High Court clarifies that the mere filing of an application under Section 7(1) of the Insolvency and Bankruptcy Code (IBC) is insufficient to invoke the bar of Section 238 of the IBC. The court emphasizes that the Adjudicating Authority must fulfill certain requirements, such as ascertaining the existence of a default and recording its satisfaction, before the bar under Section 238 can be invoked. Facts- This is an application under Section 11(6) of the Arbitration and Conciliation Act, 1996 (A & C Act,...