An article was recently published on TIOLCorpLaws, written by Adv. Puneet Agrawal (Partner at ALA Legal Advocates & Solicitors) and Adv. Gaurav Gupta (Manager at ALA Legal Advocates & Solicitors) on the topic, “Personal Guarantors to Corporate Debtors under IBC – Key issues“.
With effect from 01.12.2019, the provisions pertaining to Insolvency Resolution process of Personal Guarantors were notified by the Ministry of Corporate Affairs.
On 29.10.2019, the Supreme Court transferred to itself the writ petitions filed in several High Courts where vires of provisions of Personal Guarantor under IBC were under challenge.
Given that the issue of vires of Personal Guarantor under IBC is currently pending before the Supreme Court, the Authors identify and address key issues that are arising in this context, such as:
- What is the impact of admission of CIRP of the corporate debtor on proceedings against the Personal Guarantor?
- In which forum the proceedings will lie for insolvency proceeding against Personal Guarantor?
- Once Resolution Plan is approved under Section 31 of the IBC, can the liability still be recovered from the personal guarantor?
- If insolvency resolution results into liquidation, whether liability can be recovered from personal guarantor.
- Vires of provisions of Personal Guarantor under IBC.
The Article can be accessed on the following link:
Do read and share your comments.
Yuvraj is an advocate and has completed his B.A. LL.B(Hons) from RGNUL-Punjab. He is a practicing advocate and has been involved in matters pertaining to GST and other indirect taxes as well as Direct Tax. He is active in Writ Courts and has involvement in a few landmark judgments like Pitambra Books Pvt. Ltd. V. Union of India (W.P.C. No. 627 of 2020), and represented Sales Tax Bar Association (Delhi) to resolve GST issues and glitches.