Act Number: 31

Act Name: The Insolvency and Bankruptcy Code, 2016.

Year: 2016

Enactment Date: 2016-05-28

Long Title: An Act to consolidate and amend the laws relating to reorganisation and insolvency resolution of corporate persons, partnership firms and individuals in a time bound manner for maximisation of value of assets of such persons, to promote entrepreneurship, availability of credit and balance the interests of all the stakeholders including alteration in the order of priority of payment of Government dues and to establish an Insolvency and Bankruptcy Board of India, and for matters connected therewith or incidental thereto.

Ministry: Ministry of Corporate Affairs

Department:

Section 96: Interim moratorium.
    (1) When an application is filed under section 94 or section 95—
         (a) an interim-moratorium shall commence on the date of the application in relation to all the debts and shall cease to have effect on the date of admission of such application; and
         (b) during the interim-moratorium period—
             (i) any legal action or proceeding pending in respect of any debt shall be deemed to have been stayed; and
             (ii) the creditors of the debtor shall not initiate any legal action or proceedings in respect of any debt.
     (2) Where the application has been made in relation to a firm, the interim-moratorium under sub-section (1) shall operate against all the partners of the firm as on the date of the application.
     (3) The provisions of sub-section (1) shall not apply to such transactions as may be notified by the Central Government in consultation with any financial sector regulator.
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