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INSOLVENCY AND BANKRUPTCY (APPLICATION TO ADJUDICATING AUTHORITY FOR INSOLVENCY RESOLUTION PROCESS FOR PERSONAL GUARANTORS TO CORPORATE DEBTORS) RULES, 2019 – AN OVERVIEW
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....NSOLVENCY AND BANKRUPTCY (APPLICATION TO ADJUDICATING AUTHORITY FOR INSOLVENCY RESOLUTION PROCESS FOR PERSONAL GUARANTORS TO CORPORATE DEBTORS) RULES, 2019 – AN OVERVIEW<br>By: - DR.MARIAPPAN GOVINDARAJAN<br>Corporate Laws / IBC / SEBI<br>Dated:- 23-9-2024<br><br>Chapter III of Part III of Insolvency and Bankruptcy Code, 2016 ('Code' for short) provides the procedure for insolvency resolution pr....
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....ocess, under sections 94 to 120. Section 94(1) of the Code provides for filing petition before the Adjudicating Authority by the Personal Guarantor to initiate insolvency resolution process. Section 95 of the Code provides the procedure to file a petition by the Financial Creditor against the personal guarantor to corporate debtor. For the purpose of insolvency resolution process, the Central Go....
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....vernment made a rule called as 'Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019 ('Rules' for short), vide Notification No. GSR 854(E), dated 15.11.2019 which came into effect from 15.11.2019. Applicability These regulations are applicable to the insolvency resolution process for personal ....
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....guarantors to corporate debtors. Adjudicating Authority The National Company Law Tribunal is the Adjudicating Authority to the insolvency resolution process of personal guarantors to corporate debtors under Rule 60 of the Code. In other cases, the Debts Recovery Tribunal is the Adjudicating Authority. Guarantor The term 'guarantor' is defined under Rule 3(e) as a debtor who is a personal guara....
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....ntor to a corporate debtor and in respect of whom guarantee has been invoked by the creditor and remains unpaid in full or part. Relatives The term 'relatives' is defined under Rule 4 as the manner of relationship as provided in the Explanation to clause (24A) of Section 5. The term 'relative' with reference to anyone, who is related to another, in the following manner- * Members of a Hindu un....
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....divided Family; * Huband; * Wife; * Father; * Mother; * Son; * Daughter; * Son's daughter and son; * Daughter's daughter and son; * Grandson's daughter and son; * Granddaughter's daughter and son; * Brother; * Sister; * brother's son and daughter * sister's son and daughter, * father's father and mother, * mother's father and mother, * father's....
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.... brother and sister, * mother's brother and sister, and wherever the relation is that of a son, daughter, sister or brother, their spouses shall also be included. Application by guarantor The personal guarantor may file an application, before the Adjudicating Authority, for initiation of insolvency resolution process in Form A. Form A contains two parts - Part I and Part II. In Part I of ....
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....the application the details of personal guarantor are to be furnished. In Part II of the application- * the business particulars of the guarantor; * particulars of debt, creditor wise; * particulars of and declaration by resolution processional, if the application is filed through resolution professional; * declaration and verification, are to be furnished.In furnishing the particulars o....
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....f assets, the excluded assets are not to be included. The list of excluded assets is to be mentioned in the form. Excluded assets are- * the value of unencumbered personal ornaments shall not exceed Rs.1 lakh; * the value of unencumbered single dwelling unit owned by the debtor shall not exceed, - - in the case of dwelling unit in an urban area, twenty lakh rupees; * in the case of dwell....
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....ing unit in rural area, ten lakh rupees. The guarantor shall serve forthwith a copy of the application to every financial creditor and the corporate debtor for whom the guarantor is a personal guarantor. Application by creditor Before filing an application by the financial creditors, a demand notice shall be served on the guarantor demanding the payment of default in Form B. If the said amount ....
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....is not paid within 14 days from the date of service of the notice the financial creditor may file an application before the Adjudicating Authority in Form C. A copy of the said application shall be served on the guarantor and Corporate Debtor for whom the guarantor is a personal guarantor. Fees The fee payable along with the petition is Rs.2000-. Appointment of insolvency professional A insol....
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....vency professional may be recommended to be appointed in the application filed for initiation of insolvency resolution process for which the consent of the Insolvency Professional in Form A, has to be obtained and enclosed along with the application. If no insolvency professional is recommended the Adjudicating Authority itself appoint an insolvency professional from the panel kept by the Board. T....
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....here shall be no disciplinary proceedings against the proposed insolvency professional. A copy of the application, for initiation of insolvency resolution process, shall be provided within 3 days from the appointment of insolvency professional. A copy of the same shall be furnished to the Board for its record. Electronic form The applicant may submit accompanying documents, and wherever they ar....
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....e bulky, in electronic form, in scanned, legible portable document format in a data storage device such as compact disc or a USB flash drive acceptable to the Adjudicating Authority. Withdrawal The Adjudicating Authority may permit withdrawal of the application on the application filed by the applicant in Form D. * before its admission, on a request made by the applicant; * after its admissi....
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....on, on the request made by the applicant, if ninety per cent. of the creditors agree to such withdrawal.<br> Scholarly articles for knowledge sharing by authors, experts, professionals ....