The Moratorium Under Section 14 of the IBC (2026)
What the Section 14 moratorium freezes during a corporate insolvency, what it does not cover, who declares it, and how long the calm period lasts under the Insolvency and Bankruptcy Code, 2016. Last verified October 2026.
Explainer · Insolvency · IBC
The moratorium under Section 14 of the Insolvency and Bankruptcy Code, 2016 (IBC) is the "calm period" that begins the moment the National Company Law Tribunal (NCLT) admits a corporate insolvency resolution process (CIRP). From that date, suits and recovery actions against the company are frozen, its assets cannot be sold off, and lenders cannot enforce their security. This page explains in plain terms what the moratorium stays, what it does not touch, who declares it, and how long it runs. Last verified October 2026.
- What it is: the Section 14 moratorium is the calm period during a corporate insolvency resolution process (CIRP).
- What it freezes: suits and recovery against the company, transfer of its assets, enforcement of security (including SARFAESI), and recovery of property by an owner or lessor.
- What it does not cover: sureties and guarantors, notified transactions (such as aircraft under the Cape Town Convention, notified 3 October 2023), and the company own claims.
- Who and how long: declared by the NCLT on the insolvency commencement date, it runs until a resolution plan is approved (s.31) or liquidation is ordered (s.33), tracking a CIRP with a 330-day outer limit.
01Why the moratorium exists
When a company cannot pay its debts, every creditor wants to be first in line. Banks move to seize security, suppliers file recovery suits, and landlords try to take back premises. If each creditor pulls at the company at the same time, the business is torn apart before anyone can try to save it.
Section 14 of the IBC stops this race. It creates a short, protected window during which the company is shielded from recovery, so that the resolution professional can run the business as a going concern and the committee of creditors can look for a buyer or a revival plan. The aim is to keep value in the company, not to let it leak out one claim at a time.
The moratorium is not a reward for the defaulter. It is a shield around the company so that it can be rescued as a whole rather than stripped by the fastest creditor.
02What Section 14 freezes
Once declared, the moratorium prohibits four things against the corporate debtor. In plain terms:
- Suits and proceedings: no new suit or legal proceeding can be started, and pending ones cannot continue, including the execution of any judgment, decree or order against the company.
- Dealing with assets: the company cannot transfer, sell, or dispose of its assets or any legal right or beneficial interest in them.
- Enforcing security: no secured creditor can enforce a security interest, including action under the SARFAESI Act, 2002.
- Recovery of property: an owner or lessor cannot recover property that is in the possession of the company.
Essential supplies keep flowing
The moratorium also protects supply. The supply of goods or services that the resolution professional treats as essential cannot be cut off or suspended during the period, so that the business can keep running. Certain critical supplies notified by the Board are protected on similar lines.
03What the moratorium does not cover
The moratorium is wide, but it is not total. Several things fall outside it:
- Sureties and guarantors: the moratorium does not protect a surety in a contract of guarantee to the corporate debtor. A lender can still proceed against a personal or corporate guarantor.
- Notified transactions: the Central Government can notify transactions that the moratorium will not apply to. Using this power, the Ministry of Corporate Affairs notified, on 3 October 2023, that the moratorium does not apply to transactions, arrangements or agreements relating to aircraft, aircraft engines, airframes and helicopters under the Cape Town Convention and its Aircraft Protocol.
- Actions by the company itself: the bar is on actions against the corporate debtor. The company, through the resolution professional, can still pursue its own claims.
Courts have also read the section to not bar proceedings that are not recovery in nature against the company in the usual sense, but this is fact specific, so each matter should be checked on its own.
04Who declares it and when it starts
The moratorium is declared by the Adjudicating Authority, which for companies and limited liability partnerships is the National Company Law Tribunal (NCLT). It is declared by the same order that admits the insolvency application and appoints the interim resolution professional.
The start point is the insolvency commencement date, which is the date on which the NCLT admits the application. There is no separate waiting period. From that date the four prohibitions above apply automatically, and they are publicly announced so that creditors and the public are on notice.
05How long the calm period lasts
The moratorium runs from the insolvency commencement date until the CIRP is complete. It ends on the earlier of two events: the day the NCLT approves a resolution plan under Section 31, or the day it passes an order for liquidation under Section 33.
| Point | Rule under the IBC |
|---|---|
| Starts | Insolvency commencement date (date the NCLT admits the CIRP) |
| Ends | On approval of a resolution plan (s.31) or an order of liquidation (s.33), whichever is earlier |
| CIRP base timeline | 180 days, extendable by up to 90 days |
| CIRP outer limit | 330 days in all, including time taken in legal proceedings |
So while the moratorium itself has no fixed number of days in Section 14, in practice its length tracks the CIRP, which the Code expects to finish within 330 days.
06The forum and appeals
The CIRP, including the moratorium, is heard by the NCLT. An appeal against an NCLT order lies to the National Company Law Appellate Tribunal (NCLAT), and from there, on a question of law, to the Supreme Court of India.
Disputes under Section 14 are common in live insolvencies, because creditors, lessors and guarantors often argue over what the moratorium does and does not catch. Reading how the NCLT, the NCLAT and the Supreme Court have drawn these lines is a core part of running or defending a CIRP.
07Where Claw fits
Claw is an all-in-one legaltech platform for Indian advocates, law firms, and corporate legal teams, combining AI-based case search, an AI legal assistant (Legal GPT), case management, and compliance automation across all Indian courts and tribunals.
A moratorium fight moves quickly and across forums, from the NCLT bench to the NCLAT and at times the Supreme Court, so you need to watch a live CIRP and read how each bench has drawn the Section 14 line. Claw lets you follow cases, orders and hearings at the relevant tribunal or forum, out of 9,102 courts, benches and forums, and search more than 30 crore judgments by section, party or advocate name, with each search returning in under five seconds and reaching Supreme Court rulings from 1950 and High Court rulings from 1990. So you can track an admission order, a carve-out dispute or a guarantor action as it is passed.
Claw does not use customer case documents to train its AI models. Open a free Claw account to keep a live insolvency matter and its Section 14 orders in view. To search the wider body of law, see case search across Indian courts.
08Sources and further reading
- India Code (official text of the IBC, 2016): indiacode.nic.in
- Insolvency and Bankruptcy Board of India (regulations and circulars): ibbi.gov.in
- Ministry of Corporate Affairs (notifications under the IBC): mca.gov.in
- Claw: clawlaw.in
This explainer is general information, not legal advice. The Code and its notifications change, so check the current text and take advice from counsel before you act.
09Frequently asked questions
What does the Section 14 moratorium freeze?
It freezes four things against the company: new or pending suits and recovery proceedings, transfer or disposal of its assets, enforcement of any security interest including SARFAESI action, and recovery of property held by it from an owner or lessor. It also protects essential supplies so the business can keep running.
Does the moratorium protect a guarantor?
No. The moratorium does not apply to a surety in a contract of guarantee to the corporate debtor. A lender can still proceed against a personal or corporate guarantor even while the company is under moratorium.
Who declares the moratorium under the IBC?
The National Company Law Tribunal (NCLT), which is the Adjudicating Authority for companies, declares it by the same order that admits the insolvency process and appoints the interim resolution professional.
How long does the moratorium last?
It starts on the insolvency commencement date and ends when the NCLT approves a resolution plan under Section 31 or orders liquidation under Section 33, whichever is earlier. In practice it tracks the CIRP, which the Code expects to finish within 330 days.
Are aircraft leases covered by the moratorium?
No, not since 3 October 2023. The Ministry of Corporate Affairs notified that the moratorium does not apply to transactions relating to aircraft, aircraft engines, airframes and helicopters under the Cape Town Convention and its Aircraft Protocol.
Can I track an IBC case under Section 14 in Claw?
Yes. Claw lets you follow cases, orders and hearings at the NCLT, the NCLAT and other forums out of 9,102 courts, benches and forums, and search more than 30 crore judgments in under five seconds. It supports the tracking and research, and does not give legal advice.