The moratorium under Section 33(5) of the IBC prohibits legal proceedings against a corporate debtor during liquidation, and any notices issued by the State for breach of the Tenancy Act are invalid during this period.

JUDGMENT :

(NIKHIL S. KARIEL, J.)

1. Heard learned Senior Advocate Mr. SN Soparkar with learned Advocate Mr. Aditya Mehta on behalf of the petitioner, learned Government Pleader Mr. Gurusharansingh H. Virk with learned Assistant Government Pleader Mr. J.K. Shah and learned Assistant Government Pleader Ms. Dharitri Pancholi on behalf of respondent- State.

2. Considering the issue on hand and with consent of parties final hearing of the petition is being undertaken.

3. The issue in question raised in the present petition being that whether the State through the Mamlatdar and Agriculture Land Tribunal(ALT), Jambusar, District: Bharuch was empowered to initiate proceedings against land belonging to the company under liquidation for breach of Section 63A (1), 63(A)(B), and 63(G) of the Gujarat Tenancy and Agricultural Lands Act (hereinafter referred to as ‘the Tenancy Act’ for short) more particularly in view of the moratorium bar of proceedings under Section 33(5) of the Insolvency and Bankruptcy Code, 2016. (hereinafter referred to as ‘the I & B Code’ for short).

4. Considering the submissions made by learned Senior Advocate Mr. Soparkar and learned Government Pleader Mr. Virk since it appears to this Court that while there may not be much of a quarrel with regard to the applicability of provisions of the I & B Code, more particularly the same having been explained by the Hon’ble Supreme Court in catena of decisions and whereas since it appears to this Court that the anxiety of the State is on the aspect of resort being made to the liquidation process under the I &B Code being probably used as a tool to confer valid title upon the lands in question which according to the State it does not have, therefore, the submissions of the learned Advocates would be referred to only from the said perspective.

5. Learned Senior Advocate Mr. Soparkar on behalf of the petitioner would submit that the petitioner is a special purpose company incorporated for setting up multi product Special Economic Zones in Bharuch District. It is submitted that vide order dated 18.10.2021, the NCLT, Mumbai Bench in M.A. No. 2422/2019 liquidation process has been initiated and one Mr.Vishal Jain had been appointed as liquidator under Section 34(1) of the Code. It is stated by learned Senior Advocate that the order inter alia states that the liquidation proceedings having been initiated subject to Section 52 of the I &B Code no suit or other legal proceeding shall be instituted except liberty to the liquidator to institute suit or other legal proceedings on behalf of the corporate debtor with prior approval of the NCLT.

5.1 Learned Senior Advocate would extensively take this Court through the provisions of the I & B Code more particularly to Section 33 (5) of the Code and would submit that under Section 33(5), upon liquidation order being passed no suit or other proceedings shall be instituted by or against the corporate debtor as directed by the learned NCLT vide the order referred to hereinabove. Learned Senior Advocate would thereafter draw the attention of this Court under section 35 sub section (1)(b), (d) and (f) and would submit that the liquidator is empowered to take into his custody or control all assets property, effects, and actionable claims of the corporate debtor and also to take such measures to protect and preserve the assets and properties of the corporate debtor and further to sell movable and immovable property and actionable claims of the corporate debtor in liquidation by public auction etc. Reference is also made to Section 36 of the Code whereby the liquidator is empowered to form an estate of the assets [36(1)] and to hold the liquidation estate as a fiduciary for benefit of all creditors [36(2)]. The assets comprising of any assets over which the corporate debtor has ownership rights [36(3)(a)], assets that may or may not in possession of the corporate debtor including encumbered assets [36(3)(b)] and assets subject to determination of ow