Mere Possession Over Assets Of Corporate Debtor Under SARFAESI Act Does Not Bar Filing Of Petition U/S 7 Of IBC: NCLT Kolkata

The NCLT Kolkata clarified that the possession of a corporate debtor’s assets under the SARFAESI Act does not preclude filing a petition under Section 7 of the Insolvency and Bankruptcy Code (IBC). The tribunal ruled that even if a secured creditor has taken possession of the debtor's assets under SARFAESI, it does not bar the initiation of corporate insolvency resolution proceedings. The court emphasized that IBC provides a broader framework for debt resolution and allows multiple remedies to creditors. The ruling aims to ensure that the insolvency process remains open for secured and unsecured creditors, reinforcing the IBC’s role in resolving corporate defaults effectively.