Page 434 - IBC Orders us 7-CA Mukesh Mohan

Order Passed under Sec 7
By Hon’ble NCLT Chandigarh Bench
119) the doctrine of remedies is available only when there are two or more co-existent remedies available

to the litigants at the time of election which are repugnant and inconsistent. It was further held that there
is no repugnancy or inconsistency between the two remedies and therefore the doctrine of election has no
application. In the instant case rather the provisions of the. 'Code' have overriding effect and takes care of

the suits or proceedings against the Corporate Debtor already pending.

32. There is a clear difference in the intention of the legislature in cases of application filed by

'Operational Creditors and 'Financial Creditors An application for Corporate Insolvency Resolution
Process by Operational Creditor can be filed under section 9 of the 'Code' One of the conditions for

admitting the application is that no notice of the dispute has been received by the Operational Creditor or
there is no record of dispute in the information utility. There is no such condition while taking up the
application under section 7 of the Act about the existence of the dispute in relation to the default

committed by the Corporate Debtor

33. In any case, the legislature has taken complete care with regard to the pending cases Sub-section (1 )

of Section 14 of the Code says that subject to the provisions of sub-sections (2) and (3), on the insolvency
commencement date, the Adjudicating Authority shall by order declare moratorium for prohibiting all of
the following, namely:

(a) the institution of suits or continuation of pending suits or proceedings against the corporate debtor
including execution of any judgment, decree or order in any court of law, tribunal, arbitration panel or

other authority;

(b) transferring, encumbering, alienating or disposing of by the corporate debtor any of its assets or any

legal right or beneficial interest therein;

(c) any action to foreclose, recover or enforce any security interest created by the corporate debtor in

respect of its property including any action under the Securitsation arid Reconstruction of Financial
Assets and Enforcement of Security Interest Act, 2002 (54 of 2002);

(d) the recovery of any property by an owner or lessor where such property is occupied by or in the
possession of the corporate debtor.

So, even the continuation of pending suits or proceedings against the corporate debtor including execution
of any judgment, decree or order in any Court of law, Tribunal, Arbitration Panel or other authority,
would stand stayed. There is no indication in any provision of the Code or the Rules framed thereunder

that mere pendency of the suit or any litigation by or against the corporate debtor has any bearing upon

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