Act and the IBC in respect of the same asset, which law will prevail? Section 238 of the IBC clearly provides that the provisions of this Code shall have overriding effect over any other law (whether it is SARFAESI or cooperative laws). Once a moratorium is imposed under the IBC, all recovery proceedings initiated under the SARFAESI
In the cooperative banking sector whether urban cooperative banks or multi-state credit societies the recovery of non-performing loans has become an extremely complex issue. Earlier, recovery mechanisms under the Maharashtra Cooperative Societies Act (Section 101 / Section 91) or the SARFAESI Act were considered sufficient. However, the introduction of the Insolvency and Bankruptcy Code (IBC) in 2016 has completely changed the landscape. A recent judgment of the Hon’ble Bombay High Court in Arrow Business Development Consultants vs. Union Bank of India (WP/11132/2025) has sounded a fresh alarm bell for credit societies and banks. This article briefly examines the hierarchy between the SARFAESI Act, the IBC, and cooperative laws, and highlights the precautions that must be taken during the auction process....(To continue, open the magazine)