XYZ Limited, was undergoing a Corporate Insolvency Resolution Process (CIRP) under the Insolvency and Bankruptcy Code (IBC), 2016. While the company was in CIRP, the Bombay Stock Exchange (BSE) sought to take a legal act

Moratorium also applies on the Regulatory Authorities: In the matter of Ms. Anju Agarwal Resolution Professional for Shree Bhawani Paper Mills Ltd. Vs Bombay Stock Exchange & Ors. , the NCLAT observed that Section 28A of the SEBI Act, 1992 being inconsistent with Section 14 of IBC, it held that Section 14 of IBC will prevail over Section 28A of the SEBI Act, 1992 and SEBI cannot recover any amount including the penalty from the Corporate Debtor (CD). The 'Bombay Stock Exchange' cannot suspend trading of shares of CD for the same reason. Penalty imposed by Regulator may be claimed as Operational Creditor but cannot be recovered during the Resolution Process: In the matter of Maharashtra Seamless Ltd. Vs. Shri Padmanabhan Venkatesh & Ors. , the NCLAT held that the statutory dues i.e. the dues to Central Government or the State Government arising under any law for the time being in force and payable come within the meaning of 'Operational Debt'. If penalty is imposed or amount is payable to the 'Securities Exchange Board of India' in such case, it may claim as an 'Operational Creditor' but cannot recover the same during the 'Resolution Process'. Thus, the Bombay Stock exchange cannot recover the amount of penalty against a company undergoing insolvency proceedings.