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2020 (1) TMI 1422 - AT - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor is a Guarantor in respect of the loan given to the Principal Borrower - Principal Borrower defaulted in making payment - whether CIRP can be triggered against both the Principal Borrower (as ‘Corporate Debtor) and ‘Corporate Guarantor on same set of claim when CIRP on Principal Borrower is already started? - HELD THAT:- Once it is alleged that the Principal Borrower has defaulted, it cannot trigger against both the Principal Borrower (as Corporate Debtor) and Corporate Guarantor (as Corporate Debtor). For same set of claim, two companies cannot go for liquidation which will be against the principles of I&B Code. Reliance can be placed in the case of DR. VISHNU KUMAR AGARWAL VERSUS M/S. PIRAMAL ENTERPRISES LTD. [2019 (2) TMI 316 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI] where it was held that once for same set of claim application under Section 7 filed by the Financial Creditor is admitted against one of the ‘Corporate Debtor’ (Principal Borrower or Corporate Guarantor(s)), second application by the same Financial Creditor for same set of claim and default cannot be admitted against the other ‘Corporate Debtor’ (the Corporate Guarantor(s) or the Principal Borrower). Also, the Respondent has taken specific plea that the ‘Corporate Debtor’ is ‘Non-Banking Financial Company’ (NBFC) and do not come within the definition of ‘Financial Services’ as defined under Section 3(16) or within the definition of ‘Financial Service Provider’ as defined under Section 3(17) of the ‘I&B Code’. Appeal dismissed.
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