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2015 (3) TMI 726 - HC - Companies LawWinding up application - Liability of Corporate guarantors in case of default by borrower - Director was not authorised by board of directors to execute the guarantee - Held that:- The respondent Companies in these petitions are not the Borrower company in so far as the financial assistance provided by the petitioner. The petitioner contends that the respondents have offered corporate guarantee for repayment of the loan by the Borrower company. Though the respondents contend that the liability of the borrower itself has not been adjudicated as yet, the petitioner has contended that a winding up petition has already been instituted, the respondent therein i.e., the borrower has not chosen to defend the same. It has been admitted and is pending before this Court. It is contended, even otherwise the documents relied on indicates that the Borrower company has not disputed the liability.Be that as it may, the legal position that the creditor can choose to proceed against the guarantor on establishing the debt cannot be in doubt. Therefore, the question herein is as to whether the defense raised by the respondent to the effect that the corporate guarantee claimed not being genuine is substantial which would require adjudication in an appropriate proceedings. To consider this aspect, the reference in that regard is made to the material relied on in the lead case as the consideration is similar in the other cases. In the instant case, in any event the parties are already before the appropriate forum raising the same issues and the adjudication therein will settle these issues, which if held against the respondent company and at that stage if it is shown that they are unable to repay their debts, certainly the petition can be entertained at that stage, but as of now, the substantial issues raised will weigh in favour of the respondent to secure adjudication of the same in the forum where it is pending and that aspect cannot be decided at this stage based on the averments made in the petition and the objection statement. - Petition disposed of.
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