TaxTMI 
TaxTMI 
2026 (9) TMI 1508
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....spondent(s) RP seeking discharge and it held the liability of appellants is not limited as per the Deed of Guarantee dated 12.06.2014 and it is alleged the said finding is perverse, contrary to the documents on record, lack wisdom of CoC. 2. The learned counsel for the appellant referred to the Deed of Guarantee dated 12.06.2014 signed by the appellants in favour of the consortium of Banks, to ITS para 24 to say their liability is restricted only to an extent of market value of their properties mortgaged. Para 24 of the Deed of Guarantee is as under: - 3. Further reference was made to an Arrangement Letter dated 31.05.2014 issued prior to the Deed of Guarantee dated 12.06.2014 and it record as under: - 4. And to an Inter Creditor Agreement dated 12.06.2014 with other banks which notes: - Guarantees: - (i) Mr. Chandrashekhar B Panchal (ii) Mr Balkrushna J Panchal (iii) Mrs Nehal C Panchal (iv) Mr. Hiren S Patel (v) Ms Bhumika Nilay Shah (Limited Liability - To the extent of the Value of Collateral Property) (vi) Mr. Nilay Shah (Limited Liability - To the extent of the Value of Collateral Property) (vii)....
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....ittedly the issue of limited liability was framed for determination i.e. in para 12(iii) as under: - 12 (iii) Whether the plea of limited liability under the Deed of Guarantee (particularly Clause 24) vitiates the rejection of the repayment plan(s), especially in light of the Hon'ble NCLAT's observation dated 05.12.2024? 12. It was answered by the Ld. NCLT as under: - 15.1 The Personal Guarantors contend that liability is restricted to the value of mortgaged properties under Clause 24 of the Deed of Guarantee dated 12.06.2014, supported by sanction letters, inter-creditor arrangements, and transaction audit reports. 15.2 They invoke principles of contra proferentem (Haris Marine Products v. Export Credit Guarantee Corporation, (2022) 20 SCC 776), non est factum (Ramathal v. K. Rajamani, 2023 SCC OnLine SC 1022), and specific vs. general clauses. 15.3 The plea of non est factum requires proof that the signatory was misled as to the nature of the document executed. No such pleadings or evidence have been placed on record. The Personal Guarantors participated in DRT proceedings and did not dispute execution of the Guarantee Deed. Hence th....
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....arantors is not restricted in the manner contended. The ED attachment does not discharge personal liability under the guarantee (Section 128 Contract Act read with Section 101 IBC moratorium). 15.9 The plea of limited liability cannot be re-agitated in collateral proceedings under Section 114 of the Code. 13. It is the grievance of the learned counsel for the appellant the Deed of Guarantee is misread by the Ld. NCLT. However, when confronted with the fact if they had challenged the judgement dated 3rd August, 2021 passed by the Ld. DRT wherein their liability was crystalized as they have been jointly and severally liable with the borrowers to the extent of the liability/debt due to the borrowers, the reply was in negative. Further the appellants never challenged the claims lodged before the Resolution Professional by the Banks against these appellants. Now after sleeping over the judgement dated 3rd August, 2021 of the Ld. DRT and also upon failure to challenge the claims filed against them before the Resolution Professional, they all have come up to challenge the impugned order passed in IAs No. 612 to 614/2025, filed on 23.04.2025 by the Resolution Professional of th....
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....be mortgaged by the Guarantors to secure the credit facility granted/to be granted to Archon Engicon Limited. Description of Properties of the Guarantors to be mortgaged towards security of due repayment to the member Banks of SBI Consortium. 15. Thus the crux of the matter is besides the mortgage of these properties, did the appellants agree to be the guarantors to the entire loan taken by the borrowers. 16. The Ld. Adjudicating Authority after considering Clause 24 along with Clauses 1, 6 and 9 of the Deed of Guarantee, held Clause 24 pertains to the security arrangement and does not restrict the primary contractual liability undertaken under Clauses 1, 6 and 9. The said clauses impose liability upon the guarantors for the principal amount together with interest, costs and charges. The Ld. Adjudicating Authority further recorded the contractual clauses are required to be read harmoniously and Clause 24 cannot be construed so as to override the express liability contained in the earlier clauses and that the Ld. Adjudicating Authority cannot be employed to rewrite a commercial contract or override express liability clauses. The Ld. Authority also examined the alleged conflict....
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....3.20 crores. It is important to note the CoC in the meetings had also discussed about feasibility and viability of the repayment plan. 21. Eventually when the final modified repayment plan dated 04.01.2025 was put up for voting then it didn't receive requisite 66% voting share in favour of the Repayment Plan and was accordingly rejected. The Appellants therefore, after the plan had failed to obtain the requisite statutory approval, cannot seek to invalidate the entire process on the basis of an objection which does not demonstrate any prejudice or any finding in the impugned order that the statutory process was vitiated. 22. Section 114 contemplates consideration of the repayment plan on the basis of the report of the meeting of creditors and does not confer jurisdiction upon the Ld. Adjudicating Authority to substitute its own commercial view where the statutory majority has not been achieved. The Ld. Authority expressly held in the absence of approval under Section 111, the Adjudicating Authority cannot independently approve the plan. 23. It is important to note the final Repayment Plan(s) of Rs. 1.60 Crore & Rs. 2.75 Crore against the admitted claims of Rs. 1221,55,30,2....