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19. Learned counsel appearing for the respondent on the other hand would submit that the provisions of section 14(3) of the Insolvency & Bankruptcy Code, 2016 has to be read with section 14(1) of the Insolvency & Bankruptcy Code, 2016. He submits that the proceedings were filed before the National Company Law Tribunal against the respondent in which an order under section 14(1) of the Insolvency & Bankruptcy Code, 2016 came to be passed against the respondent. He submits that as a result of the said order of moratorium passed by the National Company Law Tribunal which was in force when the arbitral proceedings were going on and when the arbitral award was rendered, the arbitral proceedings itself would not have been proceeded with. No arbitral award could have been rendered by the learned arbitrator.

REASONS AND CONCLUSION :

26. There is no dispute that before any order was passed by the National Company Law Tribunal under section 14(1) of the 16-ca282-19.doc Insolvency & Bankruptcy Code, 2016, the dispute between the parties was already referred to arbitration by an order dated 5th April, 2017 by consent of parties in Company Petition No.489 of 2015. Though National Company Law Tribunal has passed an order on 29th January, 2019 under section 14(1) of the Insolvency & Bankruptcy Code, 2016, the respondent did not inform the learned arbitrator or to the applicant about the said order. Be that as it may,the question that arises for consideration of this Court is whether the bank guarantee furnished by the respondent pursuant to an order passed by this Court on 5th April, 2017 could be encashed or not in view of the order passed by the National Company Law Tribunal under section 14(1) of the Insolvency & Bankruptcy Code, 2016 and thereafter if encashed, the applicant could apply for release of the amount lying with the office of the learned Prothonotary & Senior Master of this Court or not.

16-ca282-19.doc

28. By an order dated 6th September, 2019 which is much after the order of moratorium under section 14 (1) of the Insolvency & Bankruptcy Code, 2016 by the National Company Law Tribunal, this Court after taking cognizance of the said order dated 29 th January, 2019 and after construing sections 14(1) and 14(3)(b) of the Insolvency & Bankruptcy Code, 2016 and after adverting to the judgment of the Supreme Court in case of State Bank of India vs. V. Ramakrishnan & Ors. (Civil Appeal No.3595 of 2018 decided on 14th August, 2018 has held that the bank guarantee furnished by the Indian Bank in favour of the learned Prothonotary & Senior Master of this Court would not enjoy the benefit of moratorium as envisaged under section 14 of the Insolvency & Bankruptcy Code, 2016. This Court accordingly held that the learned Prothonotary & Senior Master of this Court was right in invoking the bank guarantee. The said order passed by this Court in this company application allowing encashment of the bank guarantee has not been impugned by the respondent till date.

35. There is no dispute about the proposition of law canvassed by the learned counsel for the respondent that section 14(3) of the Insolvency & Bankruptcy Code, 2016 has to be read with section 14(1) of the Insolvency & Bankruptcy Code, 2016. However, since the case of the applicant falls under section 14(3)(c) of the Insolvency & Bankruptcy Code, 2016, the company application would clearly fall under an exception carved out under section 14(1) of the Insolvency & Bankruptcy Code, 2016.