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TMI Blog2009 (6) TMI 587X X X X Extracts X X X X X X X X Extracts X X X X ..... nstance of the first respondent for realisation of the due amount from the company by name "Bristo Foods Pvt. Ltd." in which the petitioner was one of the Directors. 3. With regard to the factual matrix, it is to be noted that the loan was extended to the above company by the first respondent on the basis of the collateral security and also on the basis of the personal guarantee given by the petitioner. The case of the petitioner is that she had resigned from the Board of Directors of the company and, hence, the property belonging to the petitioner could be proceeded against, only after the steps to be pursued and finalised against the properties of the company, particularly, when equitable mortgage has been created over the latter propert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e under any circumstances. The outstanding liability, as on date, will come to more than Rs. 1.76 crores and that the first respondent is very much entitled to proceed against the concerned company as well as against the Guarantors for recovery of the due amount. 6. It is brought to light that the petitioner does not have any case that she has been singled out. The learned counsel for the first respondent submits that the first respondent has already proceeded with appropriate steps against the company and its assets as well, and also against other Guarantors. In any view of the matter, this Court does not find it necessary to go into the facts and figures with regard to the relative extent of the rights and liabilities among the Guarantor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bove set out provisions of the U.P. Act are very clear. Action against the guarantor cannot be taken until the property of the principal-debtor is first sold off. As the appellant has not sold the property of the principal-debtor, the action against the appellant cannot be sustained. We, therefore, set aside the recovery notice." 8. From the above, it is crystal clear that the observation made by the Apex Court in the decision in Ashok Mahajan's case (supra) is having application only with reference to the specific provisions as contained in the U.P. Act. This is more so, in view of the law declared by a Division Bench of this Court as per judgment dated 21-10-2008 in W.A. No. 1994 of 2008 wherein almost identical circumstances as involved ..... X X X X Extracts X X X X X X X X Extracts X X X X
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