TaxTMI 
TaxTMI 
2026 (3) TMI 40
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.... report of the Resolution Professional under Section 99 of Insolvency and Bankruptcy Code, 2016 (in short 'IBC, 2016') filed in CP (IB)-489(PB)/2021 in IA No. 1331 of 2021 recommending initiation of insolvency was taken on record and the insolvency resolution process in respect of the Personal Guarantor/Appellant was instituted with immediate effect. 2. The brief facts of this case as noted in the order dated 22.03.2024 of Ld. NCLT are as under: i. The main petition CP (IB)-489(PB)/2021 was filed by the State Bank of India (hereinafter referred to as the 'Creditor') against the Personal Guarantor under Section 95 of IBC, 2016 for initiating insolvency resolution process against the Personal Guarantor. ii. Vide order dated 23.02.2022, the Adjudicating Authority appointed Shri Chanchal Dua as the Resolution Professional of the Personal Guarantor and directed him to file report under Section 99 of the IBC, 2016. iii. The Resolution Professional submitted that the insolvency application is in the requisite form, supported by requisite fee and documents and meets the requirements set out in Section 95 of the IBC, 2016. iv. The Corporate Debtor had ....
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....confirmed/renewed the earlier personal guarantee for these new sanction letters. A fresh sanction letter was issued on 15.02.2017 and the Appellant did not provide any guarantee for the same. iii. The personal guarantee of the Personal Guarantor was limited to the facilities granted in 2012 and did not extend to the new/renewed facilities. The claim of the Bank against 2012 agreement would be time-barred in the absence of revival letter post 2015 executed by the Appellant. iv. Since the debt was novated by the subsequent sanction letters replacing the original facilities, any obligation under the prior loan agreements is barred by limitation. v. The Respondent has resorted to forum-shopping by initiating multiple proceedings against the Corporate Debtor and Personal Guarantor before various forums like the DRT and NCLT. vi. The Resolution Professional exceeded his brief in recommending insolvency resolution process of the personal guarantor. The Appellant relied upon the decision in the case of Dilip B. Jiwrajka vs. Union of India & Ors., reported in 2023 SCC OnLine SC 1530 and stated that the Resolution Professional's role is limited only to con....
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..... vi. Even in response to notice under Section 13(2) of SARFAESI Act, 2002 dated 09.11.2018, neither the original borrower nor the Appellant either claimed discharge or novation. The Respondent relied upon the decision of this Tribunal in the case of SBI v. Gourishankar Poddar & Anr., reported in 2024 SCC Online NCLAT 2014. vii. Qua limitation, it was submitted that the notice under Section 13(2) of SARFAESI Act, 2002 was issued on 09.11.2018 demanding the payments, which triggered default qua Appellant and thus was the cause of action for the purpose of calculation of limitation. The petition under Section 95 of IBC, 2016 was filed on 11.08.2021, and was thus well within the limitation. Further, the Hon'ble Supreme Court in Suo-Motu Writ Petition (Civil) No(s) of 03/2020 in Re: Cognizance for Extension of Limitation had suspended the period of limitation during COVID times. viii. Considering the above facts, the petition is well within the period of limitation. The Ld. NCLT has rightly admitted the application under Section 95 and has rightly initiated insolvency resolution process against the Personal Guarantor. 5. The Ld. Counsel for the Resolution ....
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.... extension of the date for payment will not affect their liability. The said clause is as under: "The Guarantors hereby agree that notwithstanding any variation made in the terms of the said Agreement of Loan and/or any of the said security documents including reallocation/interchange of the individual limits within the principal sum variation in the rate of interest, extension of the date for payment of the installments. if any, or any composition made between the Bank and Borower to give time to, or not to sue the Borrower, or the Bank parting with any of the securities given by the Borrower, the Guarantors shall not be released or discharged of their obligation under this Guarantee provided that in the event of any such variation or composition or agreement the liability of the Guarantors shall not withstanding anything herein contained be deemed to have accrued and the Guarantors shall be deemed to have become liable hereunder on the date or dates on which the Borrower shall became liable to pay the amount/amounts due under the said Agreement of Loan and/or any of the said security documents as a result of such variation or composition or agreement." We note that in....
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....ct to waive the benefits conferred upon him by an Act of Parliament, or, as it is said, can contract himself out of the Act, unless it can be shown that such an agreement is in the circumstances of the particular case contrary to public policy." This principle was reiterated in Lachoo Mal v. Radhey Shyam." 16. On the principles of continuing guarantee, the position was cleared by a decision of this Court in Sita Ram Gupta v. Punjab National Bank whereby it was held that it was not open to a party to revoke a guarantee when he had agreed to it being a continuing one and thus would be bound by the terms and conditions of the agreement executed at the time of entering into the guarantee. In the present facts and circumstances, we, therefore, do not find any difficulty in affirming the concurrent findings of the High Court and of the trial court on the point that the agreement executed for the purpose of a continuing liability despite the variation of terms of the contract and in the absence of a specific written document by Basavaraj (since deceased) revoking the guarantee, the guarantee stands and the legal representatives of the deceased are liable to repay the loan. ....