The Supreme Court has delivered a significant ruling clarifying the boundaries between the Insolvency and Bankruptcy Code and the Prohibition of Benami Property Transactions Act, holding that attachments under the Benami Act can only be challenged before authorities constituted under that legislation and not before the NCLT or NCLAT under the IBC framework.
A bench of Justice PS Narasimha and Justice Atul Chandurkar dismissed an appeal against an NCLAT judgment that had upheld the provisional attachment of certain properties of Padmaadevi Sugars Ltd even as corporate insolvency resolution proceedings were pending against the company. The ruling settles an important question regarding the interplay between the moratorium…