Dismissal of Company Petition under IBC due to Prior Admitted Claim against Corporate Debtor

The Tribunal dismissed the Company Petition filed under Section 7 of the IBC against the Corporate Debtor for default, as a separate petition against the Corporate Guarantor for the same claim had already been admitted. The Tribunal held that once an application is admitted against one Corporate Debtor for the same claim, a second application against another Corporate Debtor cannot be admitted simultaneously. The dismissal was not based on the merits of the case, and the petitioner was granted liberty to file a fresh petition if needed.

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Issues:
Company petition under Section 7 of IBC for default in payment; Filing of multiple petitions against principal borrower and corporate guarantor simultaneously.

Analysis:
The judgment pertains to a Company Petition filed under Section 7 of the Insolvency & Bankruptcy Code, 2016 (IBC) by a Financial Creditor against a Corporate Debtor for defaulting on a significant payment. The Petitioner claimed that the Corporate Debtor defaulted on a substantial amount as per a decree issued by the Debt Recovery Tribunal (DRT) and the debt was subsequently transferred to the Petitioner. The debt was also secured by a Corporate Guarantee provided by another entity. The Petitioner had also filed a separate petition against the Corporate Guarantor for the same debt and default.

In reference to a judgment by the NCLAT in a similar case, it was highlighted that while there is no prohibition on filing two applications under Section 7 against the Principal Borrower and the Corporate Guarantor simultaneously, once an application is admitted against one Corporate Debtor for the same claim, a second application for the same claim against another Corporate Debtor cannot be admitted. This implies that separate petitions against different Corporate Debtors for the same claim cannot be admitted simultaneously.

Considering the above legal position, the Tribunal noted that since the petition against the Corporate Guarantor had already been admitted in a separate case, the present petition against the Corporate Debtor for the same claim could not be admitted. The Tribunal clarified that its decision to dismiss the present petition as infructuous did not imply any opinion on the merits of the case and granted liberty to file a fresh petition if necessary.

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