Retroactive Operation of Section 96(4) IBC: Bombay High Court Rules on Personal Guarantor Interim Moratoriums

sketch of the Bombay High Court
Case
RBL BANK LTD v. STATE OF MAHARASHTRA THRU SENIOR INSPECTOR OF POLICE, BORIVALI POLICE STATION (Bombay High Court, 18-09-2026)
Law
Insolvency and Bankruptcy Code, Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, Constitution of India.

Highlights of the Judgment:

  • Detailed analysis of whether Section 96(4) of the IBC operates retroactively to pending personal guarantor insolvency applications.
  • Application of the Mischief Rule and Heydon's Rule to statutory amendments curing the misuse of interim moratoriums.
  • Distinction between retroactive and retrospective statutory operations, and procedural versus substantive rights.
  • Examination of whether an interim moratorium under Section 96 constitutes an indefeasible vested right for debtors.
  • Harmonious interpretation of the IBC alongside the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.