SC Holds that Contracts Terminated Prior to Insolvency Do Not Constitute ‘Assets’ or ‘Property’ that Attract Protection of Moratorium under IBC

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Jan 30, 2026

SC Holds that Contracts Terminated Prior to Insolvency Do Not Constitute ‘Assets’ or ‘Property’ that Attract Protection of Moratorium under IBC

The SC, in A A Estates Private Limited v. Kher Nagar Sukhsadan Co-Operative Housing Society Ltd.,^[1] held that the protection of moratorium under Section 14 of the Insolvency and Bankruptcy Code, 2016 (‘IBC’) is confined to existing, subsisting and enforceable rights as on the date of commencement of the corporate insolvency resolution process (CIRP). The SC observed that moratorium does not revive terminated contracts or protect rights that have ceased to exist prior to insolvency since the purpose of such protection is intended to preserve the existing value of the corporate debtor’s estate and not to resurrect lapsed or extinguished interests.

[1] A A Estates Private Limited v. Kher Nagar Sukhsadan Co-Operative Housing Society Ltd., 2025 SCC OnLine SC 2579.

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