Quick answer: The Section 14 IBC moratorium begins when NCLT admits a CIRP application. From that day, suits, execution of decrees, asset transfers, SARFAESI enforcement and recovery of occupied property against the company are barred. It ends when CIRP ends, a plan is approved or liquidation is ordered. A surety under a guarantee is not covered by Section 14.
Why the moratorium matters on day one
When a company enters the Corporate Insolvency Resolution Process (CIRP), creditors rush to recover. Banks invoke security. Suppliers file suits. Landlords seek possession. If each action went ahead, nothing would be left to resolve.
The moratorium stops this race. It gives the resolution professional time to run the company and seek a resolution plan. Knowing its limits is essential for creditors, guarantors, suppliers and directors.
Key takeaways
- The moratorium starts on the insolvency commencement date, when the application is admitted.
- It blocks suits, asset sales, security enforcement and recovery of occupied property.
- Essential and critical supplies must continue, if the dues for the supply are paid.
- Guarantors are outside the moratorium, as the Supreme Court held in SBI v V. Ramakrishnan (2018).
- The 2026 Amendment Act changed parts of Section 14 from 26 May 2026.
What the moratorium stops
Section 14(1) lists four prohibited categories. The table sets them out with examples.
| Clause | What is barred | Practical example |
|---|---|---|
| 14(1)(a) | Starting or continuing suits or proceedings against the company, including execution of decrees and orders | A supplier cannot proceed with a money suit or attach bank accounts |
| 14(1)(b) | Transferring, encumbering or disposing of the company's assets or rights in them | The company cannot sell a plant to raise cash without the process |
| 14(1)(c) | Enforcing security interests, including under the SARFAESI Act, 2002 | A bank cannot take possession of mortgaged property |
| 14(1)(d) | Recovery by an owner or lessor of property occupied by the company | A landlord cannot evict the company for past dues |
A licence, permit or similar grant cannot be suspended or cancelled merely because the company is insolvent. The company must keep paying current dues during the moratorium.
Cheque dishonour cases
In P. Mohanraj v Shah Brothers Ispat Pvt Ltd (2021), the Supreme Court held that Section 138 Negotiable Instruments Act proceedings against the company fall within the moratorium. Proceedings against the company's directors are treated differently, so the directors cannot assume the same protection.
Essential and critical supplies
Section 14(2) protects goods and services that are essential to the company. A supplier cannot cut off, suspend or interrupt them during the moratorium. The protection also covers supplies the resolution professional considers critical to keep the business running as a going concern.
The protection has a limit. If the company fails to pay for the supply during the moratorium, the supplier may stop. Suppliers should therefore insist on payment for new supplies.
How long it lasts
Under Section 14(4), the moratorium runs from the date of the admission order until CIRP is complete. It ends earlier in two cases.
- NCLT approves a resolution plan under Section 31(1). The moratorium stops from the approval date.
- NCLT passes a liquidation order under Section 33. The moratorium stops from that date, and liquidation rules then apply.
CIRP itself is meant to finish within 180 days, with one extension of 90 days under Section 12.
What happens when the moratorium starts
Admission sets several steps in motion at once. NCLT appoints the interim resolution professional. A public announcement under Section 13 invites creditors to file claims. Under Section 17, the powers of the board of directors pass to the interim resolution professional, who takes control of the company's affairs and assets.
Creditors should therefore expect two things quickly: a notice of the moratorium and a deadline to file claims. Missing the claim deadline can hurt recovery later.
After a liquidation order
When NCLT orders liquidation, Section 14 stops operating from that date. A different rule then applies. Under Section 33(5), no suit or legal proceeding can be started by or against the company without the permission of NCLT, except as the Code allows for the liquidator. The 2026 Amendment Act reportedly adds protection for the liquidation stage, so check the notified wording.
What the moratorium does not cover
Notified transactions
Under Section 14(3)(a), the Central Government can notify transactions, agreements or arrangements that fall outside the moratorium. These are decided in consultation with financial sector regulators.
Sureties and guarantors
Section 14(3)(b) states that the moratorium does not apply to a surety in a contract of guarantee to the company. In SBI v V. Ramakrishnan (2018), the Supreme Court held that creditors may proceed against personal guarantors while the company is in CIRP. This is why lenders often pursue guarantors in parallel.
Offences before CIRP
Section 32A gives immunity from prosecution for earlier offences once a resolution plan is approved, subject to its conditions. It is a separate protection from Section 14 and works at a different stage.
What changed in 2026
The Insolvency and Bankruptcy Code (Amendment) Act, 2026 received assent on 6 April 2026. A notification dated 6 April 2026 shows changes to Section 14 effective from 26 May 2026. Commentary on the amendment reports three points.
- A corporate guarantor's or surety's right of subrogation cannot be enforced against the company during the moratorium.
- Moratorium protection is stated to extend into the liquidation stage.
- The new creditor-initiated process in Chapter IV-A is a separate regime from the Section 14 moratorium.
The Act also stops the interim moratorium for personal guarantors of corporate debtors under Sections 96 and 124, with effect from 26 May 2026. The Bombay High Court, as reported in July 2026 in Tata Capital Financial Services v Neel Motors LLP, held that this also reaches applications already pending on that date. Read the judgment and the notified text before relying on it.
See this CAclubindia note on Section 14 and the 2026 amendments and the annotated text of Section 14 for the current wording.
Practical points for creditors
- Stop recovery steps against the company as soon as you learn of the admission order.
- File your claim with the resolution professional within the time given in the public announcement.
- Review guarantees. The guarantor may still be pursued, subject to the 2026 changes.
- Do not set off a security deposit against old dues without advice.
Practical points for companies, directors and suppliers
- Give a copy of the admission order to courts where suits against the company are pending.
- Directors should note that cheque cases against them personally may continue.
- Suppliers should keep supplying critical goods against timely payment.
- Landlords should take advice before serving eviction notices.
Related reading and our services
To see how a case reaches this stage, read our posts on Section 7 applications by financial creditors and the Section 9 demand notice and pre-existing dispute.
For wider background, see professional services for CIRP matters and legal assistance for liquidation proceedings. Our insolvency and bankruptcy page lists our services. Contact us through the contact page.
Frequently asked questions on the Section 14 IBC moratorium
What is a moratorium under Section 14 of the IBC?
It is a statutory freeze on suits, asset transfers, security enforcement and recovery of occupied property against a company in CIRP. NCLT declares it by order on the insolvency commencement date.
When does the moratorium start and end?
It starts on the date NCLT admits the CIRP application. It ends when CIRP is completed, or earlier on approval of a resolution plan under Section 31(1) or an order of liquidation under Section 33.
Does the moratorium protect personal guarantors?
No. The Supreme Court held in SBI v V. Ramakrishnan (2018) that Section 14 does not protect personal guarantors of the company. Section 14(3)(b) excludes a surety in a contract of guarantee.
Can a bank enforce its security during the moratorium?
No. Section 14(1)(c) bars enforcement of security interests, including action under the SARFAESI Act. The bank can file its claim with the resolution professional instead.
Are supplies to the company protected during the moratorium?
Yes, essential supplies and supplies the resolution professional treats as critical must continue. The company must pay the dues for those supplies during the moratorium, or the supplier may stop.
Does the moratorium stop cheque dishonour cases?
Section 138 cases against the company are covered, as the Supreme Court held in P. Mohanraj (2021). Cases against the directors are treated differently, so they may continue.
What did the 2026 Amendment change about the moratorium?
Changes to Section 14 took effect from 26 May 2026. Reports say they bar enforcement of a corporate guarantor's subrogation rights during the moratorium and extend protection into liquidation. Check the notified text.
Conclusion
The moratorium is the shield that makes resolution possible. Creditors should stop recovery at once and file claims. Guarantors and directors should not assume the same shield covers them. Check the 2026 changes before acting.
Law stated as on 20 October 2026. This article gives general information and is not legal advice. Please consult an advocate about your facts.
