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2019 (7) TMI 1588 - Tri - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its debt - existence of debt and dispute or not - whether the Corporate Debtor is discharged by virtue of novation in the original Contract as in the light of the Section 133 of the Indian Contract Act, 1872? - HELD THAT:- It is settled position of law that liability of Principal Borrower and surety/ guarantor is joint and several and thus Lender can chose action against principal borrower or surety either separately or jointly. However, in the instant case, as stated supra, that the Petitioner has already filed suit before the Hon’ble Delhi High Court against Principal Borrower and other individual guarantors and also the present Corporate Debtor/ Corporate Guarantor and obtained consent Decree against the Principal Borrower, personal Guarantors and the instant Corporate Debtor. However, consent decree is stated to be under review. The Petitioner has not explained the reasons as to why it has not prosecuted the judgement and Decree it obtained as early as 2015 till now and as to why it has selectively chose only the Corporate Debtor herein leaving other personal Guarantors principal borrower. It is settled position of law that Law of Limitation would apply to proceedings under Code. The Petitioner has filed a suit before the Delhi High Court against the Principal Borrower. Personal Guarantors as well as the present Corporate Debtor. Therefore, initiating proceedings under the Code against the Corporate Debtor amounts to parallel proceedings against the principle of double jeopardy. Admittedly, cause of action both in the Suit before Hon’ble High court and in the present case is on set of documents. The Adjudicating Authority cannot interfere with powers of the Hon’ble High Court Delhi and it is for the Hon’ble High Court of Delhi to take a decisions on review pending wherein among other grounds, the issue of referring the matter to the Arbitration is also raised. As per Section 3 (12) "default" means non-payment of debt when whole or any pa.rt or instalment of the amount of debt has become due and payable and is not (paid) by the Debtor or the Corporate Debtor, as the case may be; and as per Section 3(11) "debt" means a liability or obligation in respect of a claim which is due from any person and includes a financial debt and operational debt". In the instant case, where the debt in question has become due against principal borrower as well as Personal Guarantors and the Corporate together. Therefore, they have filed suit before the Hon'ble High court and with consent, of parties, the Hon’ble High court of Delhi passed order dated 22.05.2015 & 06.08.2015 in CS(OS)No. 1030 of 2012. Therefore, whether the Debt as payable as per the order of Hon’ble High court of Delhi is payable or not depends on decision of Hon’ble Court in pending Review. Admittedly, the petitioner has filed suit against M/S. BT & FC Private Limited and Mr. M.V. Muralidhar, who is Managing Director & personal Guarantor along with his family members apart representing M/S. Bangalore Dehydration & Drying Equipment Co. Pvt. Ltd. which also stood Guarantor. Therefore, leaving the principal Borrower, its personnel guarantors choosing to invoke provisions of the Code only against Corporate Debtor as if it is only remedy available to it to recover its outstanding arnount is not all tenable and the same is against principle of natural justice. The Adjudicating is of the considered opinion that the instant Company petition suffers parallel proceedings as suit was filed against the Principal Borrower and Guarantors namely Mr. M.V. Murlidhar as Managing Director and Guarantor, Mrs. Padma Muralidhar as Guarantor and Ms. Sowmya Muralidhar as another Guarantor apart from the instant Corporate Guarantor and invoking provisions of the Code only against the Corporate Debtor is not tenable - Petition dismissed.
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