TMI Blog2018 (8) TMI 1037X X X X Extracts X X X X X X X X Extracts X X X X ..... ruptcy can be filed but before the same Adjudicating Authority (National Company Law Tribunal) where application against ‘Corporate Debtor’ is pending in terms of subsection (2) of Section 60. In such case ‘personal guarantor’ may claim his right of hearing, which is filed against ‘personal guarantor’ and he may also address the Adjudicating Authority, if it is ‘corporate insolvency resolution process’ pending against the ‘Corporate Debtor’. The Adjudicating Authority having failed to notice the aforesaid provision - Now it is only the ‘Corporate Debtor’ is to be heard, who is represented through the Board of Directors and the ‘Financial Creditor’ and no other person such as ‘shareholders’ or the ‘personal guarantor’. However, after the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat cannot be a ground to implead them as the partyrespondent for the following reasons. 4. Initiation of corporate insolvency resolution process under Section 7 or 9 or 10 of the I B Code is not an adversary litigation. It is not a recovery proceedings nor can be treated to be a suit or case pending for decision on merit. The Adjudicating Authority on the application filed under Section 7 of the I B Code is required to consider whether the application is complete or not and if not complete to reject the application. But before rejecting the application, if not complete, time is to be allowed to the applicant to remove the defects. 5. The Hon ble Supreme Court in Innoventive Industries Ltd. Vs. ICICI Bank and Ors., - (2018) 1 SCC ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ), where the adjudicating authority is to be satisfied that a default has occurred, that the corporate debtor is entitled to point out that a default has not occurred in the sense that the debt , which may also include a disputed claim, is not due. A debt may not be due if it is not payable in law or in fact. The moment the adjudicating authority is satisfied that a default has occurred, the application must be admitted unless it is incomplete, in which case it may give notice to the applicant to rectify the defect within 7 days of receipt of a notice from the adjudicating authority. Under sub-section (7), the adjudicating authority shall then communicate the order passed to the financial creditor and corporate debtor within 7 days of admi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Corporate Debtor , insolvency resolution or bankruptcy can be filed but before the same Adjudicating Authority (National Company Law Tribunal) where application against Corporate Debtor is pending in terms of subsection (2) of Section 60. In such case personal guarantor may claim his right of hearing, which is filed against personal guarantor and he may also address the Adjudicating Authority, if it is corporate insolvency resolution process pending against the Corporate Debtor . 9. The Adjudicating Authority having failed to notice the aforesaid provision, we set aside the order dated 25th April, 2018 passed in I.A. No. 159/2017 in CP (IB)/66/BB/2017 and direct the Adjudicating Authority to decide the case in terms of the ob ..... X X X X Extracts X X X X X X X X Extracts X X X X
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