114 (1)

In an event of the breach of repayment by Personal Guarantor, the legal consequences would automatically follow as per the provisions contained under Section 118 of the IBC – Tummala Sri Ganesh Vs. State Bank of India and Anr. – NCLAT New Delhi

Hon’ble NCLAT upheld the decision of NCLAT and held that under law the repayment plan will have to be regulated in accordance with Regulations 20 of IBBI Regulations and the stipulated time frame has to be strictly adhered to and in an event of the breach of repayment, by the personal guarantor, the legal consequences would automatically follow as per the provisions contained under Section 118 of the I & B Code. As per Section 118, the plan would be deemed to have come to an end, if it has not been fully implemented. Payment of the initial instalments cannot give a leverage or an excuse to commit subsequent default in the future repayment schedule given under the repayment plan.

In an event of the breach of repayment by Personal Guarantor, the legal consequences would automatically follow as per the provisions contained under Section 118 of the IBC – Tummala Sri Ganesh Vs. State Bank of India and Anr. – NCLAT New Delhi Read Post »

Initiation of Bankruptcy process against a Personal Guarantor – KEB Hana Bank Vs. Mr. Rohit Nath -DRT Chennai Bench (DRT-II)

From the Section 121 of IBC it is clear that an application for bankruptcy of a debtor may be made by a creditor individually or jointly with other creditors or by a debtor, to the Adjudicating Authority under certain circumstances. In the case on hand the secured creditor has filed the application for bankruptcy under Rule 7(2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019 to initiate Insolvency Resolution Process as against the Persona guarantor to the Corporate debtors. Further, it is not in dispute that the earlier proceedings initiated by the secured creditor had ended up with this Tribunal rejecting the Resolution Plan submitted by the Resolution Professional under Section 114(1) of the Insolvency and Bankruptcy Code, 2016. Therefore, as this Tribunal being the Adjudicating Authority had rejected the repayment plan under Section 114, the debtor and the creditors are entitled to file an application for bankruptcy under Chapter IV and therefore the present application of the applicant is maintainable and the secured creditor is entitled to file the application for bankruptcy under Section 123 of the Code.

Initiation of Bankruptcy process against a Personal Guarantor – KEB Hana Bank Vs. Mr. Rohit Nath -DRT Chennai Bench (DRT-II) Read Post »

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