The liabilities of the corporate debtor and the co-borrower companies are joint and co-extensive in nature and that claims of similar amounts could be submitted by the financial creditor in all the CIRPs – Mr. Sandeep Garg Director, M/s Abloom Infotech Pvt. Ltd. Vs. M/s DMI Finance Pvt. Ltd. – NCLAT New Delhi
The main dispute raised by the Appellant is that there are CIRPs going on against two other co-borrowers viz Ninex Developers and Red Topaz Real Estate companies on the basis of the same loan agreement, and hence the section 7 application against Abloom Infotech is not maintainable.
NCLAT holds that when the liabilities of the principal borrower and surety are co-extensive under an agreement, it stands to reason that the liabilities of co-borrowers who have equal and similar liabilities under a loan agreement will also be there and CIRPs against them can run simultaneously. Moreover, till the financial creditor is able to get payment of his claim, he can file claim in all the CIRPs and also have voting rights in the respective CoCs based on the quantum of his financial debt. Thus we infer that the liabilities of the corporate debtor and the co-borrower companies are joint and co-extensive in nature and that claims of similar amounts could be submitted by the financial creditor in all the CIRPs.