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ARTICLE · 21 SEPTEMBER 2017

Moratorium

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Black Law defines Moratorium as "Delay in performing an obligation or taking an action legally authorized or simply agreed to be temporary".

IndiaInsolvency/Bankruptcy/Re-Structuring
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DEFINITION

Black Law defines Moratorium as "Delay in performing an obligation or taking an action legally authorized or simply agreed to be temporary".

As per definition provided in the Oxford dictionary Moratorium is "A legal authorization to debtors to postpone payment."

Merriam Webster dictionary provides a more inclusive definition of the term Moratorium and not just related to delay in payment when it says:

  1. A legally authorized period of delay in the performance of a legal obligation or the payment of a debt
  2. A waiting period set by an authority
  3. A suspension of activity

MORATORIUM IN INSOLVENCY PROCEEDINGS

The object of insolvency laws across the world is to protect to the troubled debtor from going into a tailspin and provide him some breathing space to revive his enterprise by protecting it from the claims of its creditors and other stakeholders. As soon as a Moratorium is placed, all proceedings against the Corporate Debtor for recovery

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