Enforcement Directorate(ED) under the prevention of money laundering Act(PMLA)
National Company Law Appellate Tribunal (NCLAT) has confirmed that the rules and actions under the IBC. It will accommodate laws and other actions such as property. The attachments were made by the Enforcement Directorate(ED) under the prevention of money laundering Act (PMLA).
Hearing the appeal transferred by ED to the Mumbai bench of NCLT. NCLAT holds that even if the probe institution has attached the property under PMLA. It must empty his claim for the asset the insolvency process begins with the same company.
PMLA which comes from the company’s debtor
“In our view, there is no conflict between PMLA and IBC. Even if a property has been attached in PMLA which comes from the company’s debtor. If the CIRP starts, the property must be available to meet the IBC object to resolution. Sale of liquidation assets occurs”. Two judge benches led by Justice A I S Cheema said in her judgment.
In February 2019, the Mumbai bench of NCLT has requested a resolution professional. They requested from Sterling Sez Infrastructure Limited and Sterling International Enterprises. They ordered to take over the company’s property and handle them.
ED challenged the order of NCLT
According to the IBC rules, ED has attached assets from the two companies in May 2018. ED challenged the order of NCLT. It claims assets in attachment are under the right provisions of the PMLA. The IBC moratorium rule will not apply in “application in the criminal proceedings”.
The Probe agency also argued that the attachment order has been held by PMLA Appellate Tribunal. A professional resolution of the two companies should approach that the court. Instead of NCLT to claim company assets.
Maintaining corporate debtors is a concern: NCLAT
NCLAT states that maintaining corporate debtors is a concern. It is necessary that a professional resolution or liquidator “has the task and the right to take over and manage assets”.
“If the properties of the company’s debtor will not be available to make it a concern. Or to get properties that have values without resolution/sales wherever it is impossible. the obstruction must be removed,” he said.
This is not the first time NCLAT argues that the IBC law will accommodate others. Such as the attachment of the nature of the company’s debtor under PMLA. Previously, during the resolution of the Bhushan Steel and Power Limited. NCLAT had argued that Ed could not attach the company’s properties, thus giving immunity to new owners. The Problem Referred by IBC for actions under all the other laws is waiting at the Supreme Court. Ed has at last moving to the upper court by July for clarification.
