96. Interim moratorium.—
(1) When an application is filed under section 94 or section 95—
(a) an interim-moratorium shall commence on the date of the application in relation to all the
debts and shall cease to have effect on the date of admission of such application; and
(b) during the interim-moratorium period—
(i) any legal action or proceeding pending in respect of any debt shall be deemed to have been
stayed; and
(ii) the creditors of the debtor shall not initiate any legal action or proceedings in respect of
any debt.
(2) Where the application has been made in relation to a firm, the interim-moratorium under
sub-section
(1) shall operate against all the partners of the firm as on the date of the application.
(3) The provisions of sub-section
(1) shall not apply to such transactions as may be notified by the
Central Government in consultation with any financial sector regulator.
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