The session, titled "PMLA–IBC Interface: Emerging Bonhomie," took up a question that has produced a growing body of court rulings: what happens when a company already in insolvency resolution has its assets attached under the Prevention of Money Laundering Act (PMLA). The answer matters to lenders, resolution applicants, and investigators alike.
Kumar is a member of the Appellate Tribunal for PMLA, FEMA, PBPTA, NDPSA and SAFEMA matters. According to IICA, he explained the three stages of money laundering: placement, layering, and integration. He also described how hawala transactions figure in financial investigations.
He discussed Sections 3, 4, 5, 8, 44, and 45 of the PMLA, 2002, using judicial precedents to show how they work in practice. The Act's Section 3 defines the offence, Section 5 allows provisional attachment of property, and Section 8 covers adjudication of attachments. The release did not name the cases cited.
Attachment during insolvency
The main focus, the statement said, was the complexity that arises when a corporate debtor's assets face attachment under the PMLA during insolvency resolution. Kumar explained how courts have moved toward reconciling insolvency objectives with anti-money laundering enforcement.
Gyaneshwar Kumar Singh, IICA's Director General and CEO, welcomed Kumar and stressed the need to strengthen the link between the Insolvency and Bankruptcy Code (IBC), 2016 and the PMLA. He said Section 32A of the IBC, though precisely drafted, still faces challenges in consistent implementation, according to the release.
Background: Section 32A
Parliament inserted Section 32A into the IBC through a 2020 amendment. It protects the corporate debtor and the assets in a successful resolution applicant's hands from liability for earlier offences, but only where ownership and control change completely and only for property covered by the resolution plan. Legal commentary notes that the protection does not reach individuals who ran the company, who remain personally liable under laws including the PMLA.
Courts have weighed the two laws differently. The Delhi High Court has held that the PMLA's attachment power is not barred by the IBC's moratorium under Section 14(1)(a). The Bombay High Court, in a case involving DSK Southern Projects, held that Section 32A immunity takes precedence over earlier Enforcement Directorate attachments once a resolution plan is approved.
In December 2025, a Supreme Court bench of Justices Sanjay Kumar and Alok Aradhe allowed restitution of PMLA-attached properties to a resolution applicant for the benefit of innocent home buyers, while letting attachment continue on specified units linked to alleged proceeds of crime.
What comes next
IICA said the session reinforced the need for combined knowledge of insolvency law, financial investigation, asset tracing, and regulatory enforcement. It added that "Meet the Legend" continues to connect PGIP participants with members of the judiciary, tribunals, regulators, and the corporate sector.
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