2025 INSC 314
SUPREME COURT OF INDIA
(HON’BLE
VIKRAM NATH, J.AND HON’BLE PRASANNA B. VARALE, JJ.)
SARANGA ANILKUMAR
AGGARWAL
Petitioner
VERSUS
BHAVESH DHIRAJLAL
SHETH
Respondent
Civil
Appeal No(S). 4048 OF 2024-Decided on 04-03-2025
Consumer
Consumer Protection
Act, 1986, Section 27 - Insolvency and Bankruptcy Code, 2016, Section 95 Consumer
– No benefit of moratorium under Insolvency and Bankruptcy Code - Whether
the execution of penalty orders passed by the NCDRC can be stayed under the
interim moratorium provisions of Section 96 of the IBC? – Damages
awarded by the NCDRC arise from a consumer dispute, where the appellant has
been held liable for deficiency in service - Such damages are not in the nature
of ordinary contractual debts but rather serve to compensate the consumers for
loss suffered and to deter unethical business practices - Courts and
tribunals, including the NCDRC, exercise their statutory jurisdiction to award
such damages, and these are distinct from purely financial debts that may be
subject to restructuring under the IBC - Since such damages are covered under
"excluded debts" as per Section 79(15) of the IBC, they do
not get the benefit of the moratorium under Section 96 of the IBC,
and their enforcement remains unaffected by the initiation of insolvency
proceedings
(Para
11, 33 and 40)
JUDGMENT
Vikram Nath, J. :- The present appeal
has been filed against the final judgment and order passed by the National
Consumer Disputes Redressal Commission[NCDRC],
wherein multiple penalties (27 in total) were imposed on the appellant for
failing to deliver possession of residential units to homebuyers as per the
agreed timeline. The appellant seeks a stay on the penalty proceedings before
the NCDRC, contending that an application under Section 95 of the
Insolvency and Bankruptcy Code, 2016[IBC]
has been filed against them, triggering an interim moratorium under Section 96
of the IBC.
2.
This Court is called upon to adjudicate whether execution proceedings under
Section 27 of the Consumer Protection Act, 1986[CP Act], can also be stayed during an interim moratorium under
Section 96 of the IBC. The present matter arises from an application filed by
the appellant, who is the proprietor of proforma respondent no. 3 – East &
West Builders (RNA Corp. Group Co.), in an execution application filed by
respondent nos. 1 and 2 before the NCDRC, challenging the execution of multiple
penalty orders imposed by the NCDRC during the pendency of insolvency
proceedings against the Corporation. The appellant contends that the imposition
and execution of these penalties should be stayed due to the pendency of
insolvency proceedings initiated under Section 95 of the IBC.
3.
The appellant is engaged in real estate development and has several pending
consumer complaints before the NCDRC filed by homebuyers alleging delay in
possession, deficiency in service, and breach of contractual obligations. The
NCDRC, in its final judgment dated 10.08.2018 in CC/1362/2017 along with other
connected matters, allowed the complaints and directed the appellant to
complete construction, obtain the requisite occupancy certificate, and hand
over possession and imposed 27 penalties on the appellant for deficiency in
service by failing to deliver possession within a reasonable time. The
respondent no.1 and 2, as decree holders, subsequently filed execution
applications seeking execution of the abovementioned order of the NCDRC as the
appellant failed to comply with the directions of the NCDRC.
4.
Subsequently, the appellant, facing insolvency proceedings before the National
Company Law Tribunal[NCLT] under the
IBC, moved an application before the NCDRC seeking a stay of execution proceedings.
The appellant in the application before the NCDRC sought to contest the
execution on various grounds, including financial distress, adverse market
conditions in the real estate sector, and its ongoing insolvency
proceedings. The appellant contended that it had entered into settlement
agreements with several decree holders and had already made significant
payments, satisfying a substantial portion of the execution claims.
Specifically, the appellant stated that pursuant to entering into respective
settlement agreements, it had made entire payments in the matters of seven
homebuyers, thereby fully satisfying seven execution petitions, leaving only
thirteen execution petitions pending out of a total of twenty. It further
stated that a total amount of Rs. 11,57,34,925/- had been paid in execution
proceedings. However, some instalment payments were delayed due to reasons
beyond its control, particularly adverse economic conditions in the real estate
sector. The appellant also contended that it was one of the personal guarantors
to credit facilities extended to A.A. Estates Pvt. Ltd. by the State Bank of
India (SBI). Due to an alleged default in repayment, insolvency proceedings
under Section 7 of the IBC were initiated against A.A. Estates Pvt.
Ltd. before the NCLT, Mumbai Bench. Additionally, SBI initiated proceedings
under Section 95 of the IBC against the appellant, the proprietor of
the Judgment Debtor – proforma respondent no.3. Consequently, an interim
moratorium was triggered against the appellant as per Section 96 of
the IBC, which the appellant claimed barred further legal proceedings,
including the ongoing execution proceedings before the NCDRC.
5.
The NCDRC vide the impugned order dated 07.02.2024 rejected this application,
holding that consumer claims and the penalty imposed did not fall within the
moratorium under the IBC.
6.
The NCDRC relied on this Court’s decision in State Bank of India v. V.
Ramakrishnan & Anr. [(2018) 17 SCC
394], which clarified that Sections 96 and 101 of the
IBC provide a distinct moratorium applicable to personal guarantors, separate
from the moratorium under Section 14 applicable to corporate debtors.
The NCDRC emphasized that the stay under Sections
96 and 101 extends only to proceedings concerning the debt and
does not necessarily shield the guarantor from all legal actions.
7.
Additionally, the NCDRC placed significant reliance on this Court’s ruling
in Ajay Kumar Radheyshyam Goenka v. Tourism Finance Corporation of
India Ltd. [(2023) 10 SCC 545] .
In that case, this Court reaffirmed that criminal proceedings against directors
or signatories of a company do not abate merely because the corporate debtor is
undergoing insolvency resolution. This Court, referring to Manish
Kumar v. Union of India and Another[(2021)
5 SCC 1] , held that individuals associated with the corporate debtor
remain liable for their acts, and the company’s dissolution does not absolve
them of personal liability under statutes like the Negotiable Instruments Act,
1881[NI Act] .
8.
Furthermore, the NCDRC rejected the applicant’s reliance on the Bombay High
Court’s decision in Sheetal Gupta vs. National Spot Exchange Limited and
Ors. [2023 SCC OnLine Bom 3095],
wherein the Bombay High Court had directed stay of criminal proceedings
under Section 138 of the NI Act against the concerned persons
representing the corporate debtors. The Commission noted that while this Court
had dismissed an appeal against this ruling in SLP (Criminal) No. 4727 of 2023
in order dated 28.04.2023, the dismissal was by a brief and non-speaking
order, without any discussion on legal principles. Given that this Court’s
judgment in Ajay Kumar Radheyshyam Goenka (supra) was pronounced in
the interim and was not considered in the summary dismissal of the appeal, the
NCDRC deemed the earlier Bombay High Court ruling as per incuriam.
9.
Accordingly, for the reasons stated above the NCDRC concluded that the interim
moratorium under Section 96 of the IBC did not bar the continuation
of criminal proceedings under Section 27 of the CP Act, against the
applicant in her personal capacity as a guarantor.
10.
The appellant is before us challenging this order of the NCDRC.
11.
The primary question of law before this Court is whether the execution of
penalty orders passed by the NCDRC can be stayed under the interim moratorium
provisions of Section 96 of the IBC.
12.
The appellant argues that all debts and all proceedings relating to debt are
automatically stayed under Section 96 of the IBC. The respondents, on
the other hand, contend that the penalties imposed by NCDRC are distinct
from "debt recovery" proceedings and should not fall within the ambit
of the interim moratorium.
13.
The appellant contended that Section 96 of the IBC creates an
absolute bar on any proceedings against the debtor relating to any debt once an
interim moratorium is in place. It is submitted that the penalties imposed by
the NCDRC arise out of financial obligations or debts and must, therefore, be
stayed. The appellant submits that as per Section 96 of the IBC when
an application is filed under Section 94 or Section 95 of
the IBC, an interim moratorium shall commence on the date of the application,
in relation to all debts. In the present case the application
under Section 95 of the IBC was filed against the appellant on
20.01.2022 and therefore, as per the provisions of Section 96 of the
IBC, the interim moratorium commenced against the appellant from 20.01.2022 and
thus the proceedings under Section 27 of the CP Act pending before the
NCDRC shall be deemed to have been stayed since as per Section
96(1)(b)(i) of the IBC during the interim moratorium period, “any legal
action or proceedings, pending in respect of any debt, shall be deemed to
have been stayed.”
14.
The appellant further submitted that the proceedings under Section
27 of the CP Act are effectively recovery proceedings. Respondent No. 1
and 2 in their execution application have primarily sought for an award of Rs.
1,55,00,000/- while abandoning the other prayers or reliefs granted in the
Consumer Complaint. Therefore, the execution proceedings initiated by the
Respondent Nos. 1 and 2 are proceedings to recover the amounts under the garb
of seeking an award. Since, the interim moratorium has commenced against the
appellant, the appellant is estopped from undertaking any preferential
payments, as such the continuation of the execution proceedings against the
appellant would constitute an act of double jeopardy.
15.
The appellant cited P. Mohanraj and Others v. Shah Brothers Ispat Private
Limited[(2021) 6 SCC 258], where it
was held that proceedings under Section 138 of the NI Act are covered
under “any legal action or proceeding pending” even though they are
quasi-criminal in nature, thus also staying criminal proceedings against the
corporate debtor. The principle that insolvency proceedings should take
precedence over all other claims is reiterated, and the appellant seeks similar
protection under Section 96 of the IBC for interim moratoriums
applicable to personal guarantors and individuals. It is argued that unless
such a stay is granted, the insolvency process will be frustrated, and the
appellant will be subjected to conflicting proceedings across multiple fora.
16.
The appellant also relied upon the judgment of this Court in the matter of SBI
V. V.Ramakrishnan (supra), wherein it was held that when an application is
filed under Part III of the IBC, an interim moratorium or a moratorium is
applicable in respect of any debt due and that the protection
under Section 96 of the IBC is far greater than that
under Section 14 of the IBC. Reliance was also placed on the
judgment of this Court in Kaushalya Devi Massand vs. Roopkishore Khore[(2011) 4 SCC 593], holding that the
gravity of complaint under the NI Act cannot be equated with an
offence under the provisions of the Indian Penal Code, 1860[IPC] or other
criminal offences and that an offence under Section 138 of the NI Act
is almost in the nature of civil wrong which has been given criminal overtones.
Thus, it has been submitted, similarly the penal provisions under the CP
Act cannot be equated to offences under the IPC. Since these are also
recovery proceedings in nature, they would also fall within the ambit
of Section 96 of the IBC.
17.
It was thus the submission of the appellant that a bare perusal of the
aforementioned judgments, would leave no scope of interpretation that the
definition of the term ‘debt’ is wide enough to not only include quasi-criminal
proceedings but also recovery proceedings. Therefore, it is abundantly clear
that the NCDRC erred in dismissing the application filed by the appellant.
Furthermore, in view of the settled legal position as enunciated hereinabove,
the execution proceeding pending against the appellant must be stayed till the
operation of interim moratorium under Section 96 of the IBC.
18.
On the other hand, the respondent nos. 1 and 2, primarily homebuyers, contend
that the penalties imposed by the NCDRC are not merely monetary claims but
punitive measures to deter unfair trade practices. They argue that consumer
protection proceedings serve a vital public function in ensuring compliance
with orders protecting homebuyers, who are already vulnerable due to the
developer’s delays. The respondents assert that staying such penalties would
set a dangerous precedent where developers can indefinitely delay justice by
invoking insolvency proceedings.
19.
The respondents submitted that the moratorium imposed under Section
96 of the IBC does not extend to criminal proceedings under Section
27 of the CP Act. The respondents contend that the moratorium
under Section 96 of the IBC is limited to recovery actions and civil
proceedings against the debtor, with no applicability to criminal proceedings.
It is submitted that Section 27 of the CP Act provides for punitive
action against those who fail to comply with orders of the consumer forum,
which is penal in nature and distinct from debt recovery proceedings. The
NCDRC, by its order dated 07.02.2024, has rightly held that the moratorium
under IBC does not cover criminal proceedings, and such an interpretation is
consistent with established judicial precedents. Additionally, the respondents
contend that the nature of proceedings under Section 27 of the CP Act
is inherently punitive, as it prescribes punishment, including imprisonment,
for non- compliance with consumer forum orders. Unlike civil recovery
proceedings, which aim at debt enforcement, Section 27 of the CP Act
serves a penal function by ensuring compliance with consumer rights and
providing a deterrent against non- execution of forum orders. The regulatory
and penal proceedings are distinct from civil claims and cannot be stalled due
to insolvency moratoriums. Since Section 27 of the CP Act explicitly
provides for imprisonment as a consequence of non-compliance, it cannot be
considered a mere debt recovery mechanism and thus falls outside the scope of
the IBC moratorium.
20.
The appellant sought to rely on the Bombay High Court’s decision
in Sheetal Gupta v. National Spot Exchange Ltd. & Ors. (supra),
and this Court’s subsequent dismissal of the challenge
in National Spot Exchange Ltd. v. Sheetal Gupta &
Anr. (supra). However, the respondents argued that since this Court’s
order was a mere dismissal without any reasoning, it does not constitute a
binding precedent. Citing Kunhayammed & Ors. v. State of Kerala &
Anr. [(2000) 6 SCC 359] and
Khoday Distilleries Limited & Ors. v. Sri Mahadeshwara Sahakara Sakkare
Karkhane Limited, Kollegal[(2019) 4 SCC
376], the respondents submitted that a non-speaking dismissal does not
decide any legal issue and, therefore, does not attract the doctrine of
merger. In contrast, NCDRC correctly applied the ratio of Ajay Kumar
Radheyshyam Goenka (supra), which distinguishes civil liability from criminal
prosecution.
21.
The respondents further argued that the moratorium under IBC is designed to
protect the assets of the corporate debtor and the personal guarantor from
alienation. However, not all debts are covered under this
protection. Section 94 of the IBC clarifies that the moratorium
applies only to debts that are not "excluded debts"
under Section 79(15) of the IBC. As per this provision, liabilities
arising from fines imposed by courts or tribunals, damages for negligence
or breach of obligation, maintenance liabilities, student loans, and other
prescribed debts are excluded. Since the damages awarded by NCDRC and their
execution fall under "excluded debts," the moratorium
under Section 96 of the IBC does not apply.
22.
The respondents emphasize that Section 27 of the CP Act, imposes
criminal liability, including imprisonment for non-compliance with consumer
court orders. This Court in Satyawati v. Rajinder Singh and Another[(2013) 9 SCC 491], highlighted the
severe impact of delays in execution proceedings, observing that such delays
deprive decree-holders of the fruits of litigation. Given that the NCDRC award
falls within the category of "excluded debts," the moratorium does
not extend to criminal proceedings initiated for its enforcement, these
proceedings are merely delay tactics on part of the appellant.
23.
The respondents highlighted the prolonged hardship faced by the decree holders
due to the appellant’s repeated delays in execution proceedings.
Despite this Court’s ruling in Vijay Madanlal Chaudhary & Ors. v.
Union of India[2021 SCC OnLine SC 1048],
which held that orders granting "no coercive action" should not be
treated as a stay of proceedings, the appellant has used such an order to stall
the matter. Through a timeline of events the respondents sought to demonstrate
the appellant’s continued non-compliance, starting from the booking of flats in
2011, the filing of consumer complaints in 2017, the NCDRC's ruling in favour
of the consumers in 2018, and the subsequent delays in execution proceedings.
Non-bailable warrants were issued against Saranga Aggarwal in 2021 due to
non-compliance, yet the appellant has failed to take steps to honour its
obligations.
24.
Lastly, the respondents counter the appellant’s argument that the execution
petition’s prayer is defective. They submit that the prayer must be read
holistically, as it seeks to enforce compliance under Section 27 of
the CP Act. The execution petition was filed only after the appellant failed to
pay compensation or resume construction as per the consumer court’s orders.
Given these circumstances, the respondents contended that NCDRC’s order is
legally sound and should be upheld, as the moratorium under IBC does not bar
the continuation of criminal proceedings for non-compliance with consumer court
awards.
25.
In light of the above, the respondent submitted that the appeal against the
NCDRC’s order is devoid of merit and should be dismissed. The judicial
precedents, as well as the legislative intent behind the CP Act and
the IBC, make it clear that the moratorium under Section 96 of the
IBC is not meant to protect individuals from criminal prosecution. Accepting
the appellant’s argument would lead to an anomalous situation where persons
violating consumer rights could evade penal consequences merely by initiating
insolvency proceedings, thereby frustrating the very purpose of consumer
protection laws.
26.
We have heard Mr. K. Parmeshwar, learned senior counsel appearing for the
appellant and Mr. Shashwat Parihar, learned counsel appearing on behalf of
respondent nos.1 and 2.
27.
We find that there is a fundamental distinction between civil and criminal
proceedings concerning a debt moratorium. While civil proceedings are
generally stayed under IBC provisions, criminal proceedings, including penalty
enforcement, do not automatically fall within its ambit unless explicitly
stated by law. The penalties imposed by the NCDRC are regulatory in nature and
arise due to non- compliance with consumer protection laws. They are distinct
from "debt recovery proceedings" under the IBC.
28.
A moratorium under Section 96 of the IBC is distinct from a corporate
moratorium under Section 14 of the IBC. Section 96 of the
IBC applies to individuals and personal guarantors and provides that during the
interim moratorium period, "any legal action or proceedings relating to
any debt shall be deemed to have been stayed." However, it is pertinent to
note that this provision applies only to "debt" as defined under the
IBC and not to regulatory penalties imposed for non-compliance with consumer
protection laws. A careful reading of the statutory scheme of the IBC suggests
that penalties arising from regulatory infractions are not covered under the
ambit of "debt" as envisioned under the Code.
29.
It is well settled that there exists a distinction between punitive actions and
criminal proceedings. While a criminal proceeding is initiated by the State
against an accused to determine guilt and impose penal consequences, punitive
actions in the regulatory sphere, such as those imposed by the NCDRC, are meant
to ensure compliance with the law and to act as a deterrent against future
violations. Section 27 of the CP Act empowers consumer fora to impose
penalties to ensure adherence to consumer protection norms. These penalties do
not arise from any "debt" owed to a creditor but rather from the
failure to comply with the remedial mechanisms established under consumer law.
Unlike a criminal prosecution, which requires the establishment of mens rea,
the penalties imposed by NCDRC are regulatory in nature and aim to protect the
public interest rather than to punish criminal behaviour.
30.
Further, a distinction must be drawn between the moratorium applicable to a
corporate debtor under Section 14 of the IBC and the interim
moratorium applicable to individuals and personal guarantors under Section
96 of the IBC. The former is much broader in scope and stays all
proceedings against the corporate debtor, including execution and
enforcement actions. However, Section 96 of the IBC is more limited
in its scope, staying only "legal actions or proceedings in respect of any
debt." Unlike corporate insolvency proceedings, where the goal is a
comprehensive resolution of the company’s liabilities, individual insolvency proceedings
are designed primarily for restructuring personal debts and providing relief to
the debtor. The legislative intent behind limiting the scope of the interim
moratorium under Section 96 of the IBC must be respected, and a
blanket stay on all regulatory penalties would result in defeating the
objectives of consumer protection laws.
31.
The moratorium under Section 96 of the IBC is intended to provide
temporary relief to debtors by preventing certain proceedings against them
during the resolution process. However, this protection is not absolute and
does not extend to all categories of debts. The legislative intent behind the
moratorium is to ensure that the debtor's assets are preserved for an efficient
resolution process and to prevent creditors from taking unilateral actions that
may frustrate the objective of insolvency proceedings. However, the statutory
scheme of the IBC makes it clear that the protection under the moratorium does
not cover all forms of liabilities, particularly those classified as
"excluded debts" under Section 79(15) of the IBC.
32.
The respondents have rightly contended that Section 94(3) of the IBC
explicitly limits the scope of the moratorium by carving out exceptions for
certain categories of debts. Section 79(15) of the IBC defines
"excluded debts" to include liabilities arising from fines imposed by
courts or tribunals, damages for negligence or breach of obligation,
maintenance liabilities, student loans, and other prescribed debts. This classification
is based on the nature of such obligations, which are either statutory, penal,
or personal in nature, and therefore, they do not form part of the insolvency
estate that can be discharged under the resolution process.
33.
In the present case, the damages awarded by the NCDRC arise from a consumer
dispute, where the appellant has been held liable for deficiency in service.
Such damages are not in the nature of ordinary contractual debts but rather
serve to compensate the consumers for loss suffered and to deter unethical
business practices. Courts and tribunals, including the NCDRC, exercise their
statutory jurisdiction to award such damages, and these are distinct from
purely financial debts that may be subject to restructuring under the IBC.
Since such damages are covered under "excluded debts" as
per Section 79(15) of the IBC, they do not get the benefit of the
moratorium under Section 96 of the IBC, and their enforcement remains
unaffected by the initiation of insolvency proceedings.
34.
Furthermore, the rationale behind excluding such liabilities from the
moratorium is rooted in public policy considerations. If damages arising from
legal violations, consumer protection claims, or penalties imposed by courts
and tribunals were to be shielded under the moratorium, it would create an
unfair advantage for errant entities and individuals, allowing them to evade
their legal obligations under the guise of insolvency. The IBC, being a special
law meant to balance the interests of all stakeholders, does not intend to
provide relief to those who have been held liable for statutory breaches or
misconduct.
35.
The penalties imposed by the NCDRC arise due to non-compliance with consumer
protection laws and serve a regulatory function rather than constituting
"debt recovery proceedings." This distinction is crucial. The IBC is
designed to deal with insolvency resolution and financial distress, whereas
consumer protection laws exist to uphold consumer rights and ensure fair
business practices. The penalties under Section 27 of the CP Act are
aimed at compelling compliance and cannot be equated with recovery of an
outstanding debt. The appellant cannot claim that such penalties fall within
the scope of a debt moratorium, as they do not constitute financial liabilities
owed to a creditor but rather statutory obligations enforced to uphold consumer
rights. Allowing the stay of such penalties would effectively enable businesses
to flout consumer protection mandates by merely initiating insolvency
proceedings, which would be an unintended and dangerous consequence of a
misinterpretation of the law.
36.
The distinction between proceedings under Section 138 of the NI Act
and those under Section 27 of the CP Act must also be examined.
Proceedings under Section 138 of the NI Act pertain to dishonour of
cheques and are criminal in nature, where the assumption of debt is inherent in
the offence itself. The dishonour of a cheque indicates a failure to honour
financial obligations, and the proceedings are initiated for the recovery of the
debt in question. In contrast, Section 27 of the CP Act deals with
non- compliance with consumer protection orders, which are remedial in nature
rather than criminal. The primary focus of proceedings under Section
27 of the CP Act is to enforce consumer rights and ensure that service
providers fulfil their obligations. These proceedings do not assume the
existence of a financial debt but rather deal with deficiencies in service and
the failure to comply with consumer redressal mechanisms. Thus, the analogy drawn
by the appellant between the moratorium on Section 138, NI Act proceedings
and Section 27, CP Act proceedings is misconceived and legally untenable.
37.
If the appellant’s argument is accepted, homebuyers, who have already suffered
immense delays and financial hardship, would be further deprived of relief. The
legislative intent behind consumer protection laws is to safeguard the
interests of consumers and ensure accountability from service providers.
Permitting a stay on regulatory penalties under the guise of insolvency
proceedings would undermine the very purpose of the CP Act and
embolden errant developers to escape liability through insolvency proceedings.
Homebuyers, many of whom invest their life savings in purchasing residential units,
are already in a precarious position due to delays in possession and breaches
of contractual obligations. Staying penalties that serve as deterrence against
such unfair practices would render consumer protection mechanisms ineffective
and erode trust in the regulatory framework.
38.
Judicial precedents support the view that statutory penalties and regulatory
actions do not automatically fall within the ambit of an insolvency moratorium.
In P. Mohanraj (supra) this Court held that a moratorium under Section
14 of the IBC extends to proceedings under Section 138 of the NI
Act. However, a distinction between debt recovery proceedings and punitive
actions needs to be created, and therefore all criminal liabilities do not fall
within the scope of the moratorium unless explicitly covered under the IBC.
Consequently, penalties imposed by regulatory bodies in the public
interest cannot be stayed merely because insolvency proceedings are ongoing.
39.
The present case does not involve a mere financial dispute but concerns the
enforcement of consumer rights through regulatory penalties. Given that the
legislative intent behind the CP Act is to ensure compliance with
consumer welfare measures, staying such penalties would be contrary to public
policy. Further, the appellant cannot invoke insolvency proceedings as a shield
to evade statutory liabilities. The objective of the IBC is to provide a
mechanism for resolving financial distress, not to nullify obligations arising
under regulatory statutes.
40.
For the foregoing reasons, this Court finds no merit in the appellant’s
arguments. The penalties imposed by the NCDRC are regulatory in nature and do
not constitute "debt" under the IBC. The moratorium
under Section 96 of the IBC does not extend to regulatory penalties
imposed for non-compliance with consumer protection laws.
41.
The appeal is accordingly dismissed, and the appellant is directed to comply
with the penalties imposed by the NCDRC within a period of eight weeks
from the date of this judgment.
42.
Pending application(s), if any, shall stand disposed of.
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