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10. It is argued that Section 238 of IBC cannot preclude action under PMLA and because of this Section 32A of IBC was required to be introduced and said amendment does not affect action pre approval of resolution plan.

11. The Learned counsel for the appellant in support of such submission has referred to judgements. We will refer relevant judgements later in this judgement.

The Defence

12. Against the above, Respondent No.1 and 3 are supporting the impugned order. Respondent No.2 is also supporting the other two Company Appeal (AT)(Insolvency) No.575 and 576 of 2019 respondents. According to the respondents the nature of attachment qua proceedings under PMLA is not compulsorily criminal in nature in every instance. The proceedings before Adjudicating Authority are civil in nature. It is argued that only when the trial is concluded and Special Court orders confiscation title is lost. The property does not till that point of time vest with the Central Government. It is argued by the Respondent that the property of the Corporate Debtor is independent from the management of Corporate Debtor and protection has been granted under Section 32A of IBC. There is no vesting of property under Section 9 of PMLA and there is no predicament for the CIRP to continue. IBC and PMLA are both special statutes and IBC being subsequent with provisions like Section 238 IBC will prevail over provisions of PMLA. The object of attachment under Section 5 of PMLA is only to prevent the management of the corporate debtor from creating any third parties rights. Once CIRP is initiated, Resolution Professional takes control of the properties of corporate debtor and there is protection so that no third party rights are created. There is no conflict between the IBC and PMLA. Respondents are thus arguing that the impugned order should not be interfered with.

Before Adjudicating Authority, the Resolution Professional relied on Section 18 of the Insolvency and Bankruptcy Code, 2016 (IBC in short) with regard to the control and custody of the assets of the Corporate Debtor required under IBC. Reliance was also placed on Section 14 of IBC as well as the Section 238 of IBC and Judgments in support. The Adjudicating Authority considered the arguments of the Enforcement Directorate which claimed that SBL Group had obtained more than Rs. 5,000/- Crores from Banks and Financial Institutions and the loan turned into N.P.A. Appellant claims that forensic audit Report was taken from Andhra Bank and State Bank of India and use of the loan was made for non-mandated purposes, payments made to non-existent parties and unjustified payments to directors. Appellant claimed that credit facility availed by M/s. SBL Group was declared as fraud account by the concerned banks. Referring to the investigation and attachment proceedings, Appellant claimed before Adjudicating Authority that PMLA was special Act. That, Section 71 of PMLA gives overriding effect and objects of PMLA and IBC were different and that moratorium could not be applied to criminal case initiated.

41. Alternatively, even if for any reason it was to be held that Section 14 of IBC would not help, it appears to us that Section 238 of IBC would still apply. Although it is argued that PMLA is a special statute and has an overriding effect still Section 238 of IBC is also a special statute and which is subsequent statute. IBC has specific object, which is to consolidate and amend laws relating to reorganisation and insolvency resolution of corporate persons, partnership firms and individuals in a time-bound manner for maximization of value of assets of such persons and to promote entrepreneurship, availability of credit and balance the interest of all stakeholders including alteration in the order of priority of payment of Government dues.

Section 238 of IBC reads as under:

"238. The provisions of this Code shall have effect, notwithstanding anything inconsistent therewith contained in any other law for the time being in force or any instrument having effect by virtue of any such law."

If this Section is perused, the provisions of this Code would have effect notwithstanding anything inconsistent therewith contained "in any other law" for the time being in force. Section 238 of IBC does not give over riding effect merely to Section 14. The other provisions also are material, and will Company Appeal (AT)(Insolvency) No.575 and 576 of 2019 have effect if there is anything inconsistent therewith contained in any other law for the time being in force. Thus if the Authorities under PMLA on the basis of the attachment or seizure done or possession taken under the said Act resist handing over the properties of the Corporate Debtor to the IRP/RP/Liquidator the consequence of which will be hindrance for them to keep the Corporate Debtor a going concern till resolution takes place or liquidation proceedings are completed, the obstructions will have to be removed. We have already referred to the various Acts required to be performed by IRP/RP/Liquidator to achieve the aims and objects of IBC in time bound manner. If properties of Corporate Debtor would not be available to keep it a going concern, or to get the properties valued without which Resolution/Sale would not be possible, the obstruction will have to be removed. To take over properties of Corporate Debtor, and manage the same, and keep Corporate Debtor a going concern are acts which fall within purview of IBC. IRP/RP/Liquidator under IBC have duty and right to take over and manage assets of Corporate Debtor as long as the assets are property of the Corporate Debtor, so that the other duties conferred on them by the statute are performed. These are issues relating to resolution/liquidation. If hindrance is being created by the attachment or by taking over the possession, it would be a question of priority arising out of or in relation to the insolvency resolution or liquidation proceedings of the Corporate Debtor and such question can be decided by the Adjudicating Authority under Section 60 (5) (c) of IBC which reads as under: