Resolution Plan does not absolve the Personal Guarantors from their Guarantee – Roshan Lal Mittal and Ors. v. Rishabh Jain and Ors. – NCLAT New Delhi

Hon’ble NCLAT held that the Resolution Plan does not absolve the personal guarantors from their guarantee. The law well settled by the Hon’ble Supreme Court in the matter of Lalit Kumar Jain vs. Union of India & Ors. (2021) ibclaw.in 61 SC, that by approval of resolution plan the guarantees are not ipso facto discharged. The resolution applicant has taken liability of only one crore, the other liabilities of the personal guarantors are not discharged.

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If any Public depositor applies showing due of the debt claiming itself as operational creditor and the Resolution Professional or the Tribunal do not accept the claim on the ground that they are not financial creditor, we allow the appellant to raise the question before the Tribunal and if any adverse decision is given by the Tribunal, it will be open to the appellant to raise the issue before NCLAT- Hind Motors India Ltd. Vs. Adjudicating Authority NCLT, Chandigarh – NCLAT New Delhi

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