Insolvency Proceedings Cannot Override PMLA Process : NCLT

The NCLT, Delhi, has ruled that insolvency proceedings under the IBC cannot be used to bypass ongoing action under the Prevention of Money Laundering Act (PMLA).

The order came in a plea by the resolution professional seeking dissolution of Shakti Bhog Snacks under Section 54 of the IBC.

The Enforcement Directorate (ED) opposed the plea, citing ongoing PMLA proceedings related to a ₹3,269 crore loan fraud. The NCLT held that allowing dissolution would obstruct the ED’s efforts and frustrate the statutory objective of PMLA.

NCLT clarified that IBC cannot shield companies from statutory liability under special laws like PMLA.