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TMI Blog2022 (9) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtor) Rules, 2019 (hereinafter referred to as the Rules, 2019), against Mr. Naresh Mittal, who is the personal guarantor in relation to the credit facility availed by M/s. Hi Tech Grain Processing Pvt. Ltd. (hereinafter referred to as Corporate Debtor) for an amount of Rs. 209,61,09,614 (Rupees Two Hundred Nine Crores Sixty-One Lakhs Nine Thousand Six Hundred Fourteen) as on 31.08.2020. 2. On presentation of the Petition CP (IB) No. 352/ND)/2021, by the Applicant, this Adjudicating Authority vide order dated 05.08.2021, appointed the Resolution Professional viz., Mr. Sunil Kumar Kabra, as proposed by the Financial Creditor in the Part IV of Form C, having Registration No. IBBI/IPA-001/IP-P01011/2017-18/11662, having Email Id: [email protected] and directed him to examine the application referred in Section 95(1) of IBC, 2016 and file a report under Section 99 of IBC, 2016. The interim moratorium was commenced from the date of filing the application i.e. 01.04.2021, as stipulated under 96(1) of the IBC, 2016. The Report under Section 99 of IBC, 2016 has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rsonal Guarantors. * The Financial Creditor served a Demand Notice dated 31.08.2020 in 'Form B' in compliance with the provisions of Rule 7(1) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process of Personal Guarantee to Corporate Debtor) Rules, 2019, to the Personal Guarantors demanding the payment of outstanding debt in terms of the personal guarantee deed/agreement within 14 (fourteen) days from the date of this notice. On non-receipt of any response from the Personal Guarantor, the Financial Creditor has filed the present petition under section 95(1) of the Insolvency and Bankruptcy Code, 2016. * The Resolution Professional had sent letter dated 09.08.2021 to intimate the order passed by the Hon'ble National Company Law Tribunal dated 05.08.2021 for declaration of interim moratorium w.e.f. the date of application i.e., 1st April 2021, to: a. Personal Guarantor: Mr. Naresh Mittal b. State Bank of India (Financial Creditor) c. Income Tax Department d. Resolution Professional of Hi-Tech Grain Processing Private Limited, Ms. Chanchal Dua * The Resolution Professional vide his letter dated 09.08.2021, ask ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Hon'ble Tribunal as well as the Resolution Professional. In view of the above, the Applicant is liable to be punished under Section 184(1) of the Insolvency and Bankruptcy Code, 2016 for providing information which is false. ii. That, the proceedings against the Personal Guarantor is untenable as it is yet to be ascertained in the CIRP proceedings relating to the Corporate Debtor, as to what amounts the financial creditors will recover either on the culmination of CIRP into approval of the Resolution Plan or Liquidation of the assets of the Corporate Debtor, in the absence of which, the amount recoverable from the Respondent herein, if any, cannot be crystallized. Further, there is no averment in the Petition that simultaneous proceedings against the Corporate Debtor and the Personal Guarantor are necessary for eliciting much better resolution plans in respect of the Corporate Debtor. The present proceedings, thus, is not maintainable. iii. That, Respondent was coerced to stand as surety to secure the credit facilities sanctioned by the members of the consortium to Corporate Debtor. Pertinently, the Respondent were induced and compelled to append his signatures on a large ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Hon'ble Tribunal. Thus, the captioned Petition is liable to be dismissed on this ground alone. ix. That, the Applicant has not placed on record the vouchers and other supporting documents in support of the alleged debit entries and other alleged transactions contained in the statements of accounts. x. Based on the facts as stated above the present petition is liable to be dismiss. 4. The Applicant, in his rejoinder dated 11.01.2022 has submitted that: * That, applicant humbly submits that the applicant and the RP are not guilty of concealment and suppression of material facts from the honorable Tribunal. Due to internal transfers of officers, the fact with regard to reply of respondent with regard to demand notice dated 31/8/2020 could not be brought to the notice of the Hon'ble Tribunal. The Resolution Professional personally visited the office of the Personal Guarantor at New Delhi on 16th August 2021, and collated some of the documents of the Guarantor, the said document could have been easily provided by the Respondents to the RP on his personal visit but the said fact was deliberately not revealed by the respondent which shows their ulterior motives to hide th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ues from the personal guarantors and some from the Corporate Debtor. There is no provision in the Code which bars the initiation of Insolvency Resolution Process against the Personal Guarantor until the debt amount which is to be recovered from the Corporate Debtor gets crystallized. Further it is a well settled principle that the liability of surety in the Contract of Guarantee is co- extensive with that of Principal Borrower. 2. The second contention raised by the Personal Guarantor is that the Respondent/Personal Guarantor was coerced into signing the Personal Guarantee agreement. The contention raised by the Respondent is implausible and unconvincing for the reason that it is not possible that the Respondent would not have got alerted if he was being made to sign a sheaf of documents in respect of a loan being taken by some other party. Further it is also not tenable because after the said coercion, no legal action was taken by the Personal Guarantor. The Law of Contract is very clear with respect to voidable contract that when consent to an agreement is caused by coercion, the agreement which is a contract is voidable at the option of the party whose consent was so caused. M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s provided under Section 103 within 21 days of such issuance. The notice shall contain the necessary information as provided under Section 102(2) of IBC, 2016. The publication of notice shall be made in newspapers, one in English and other in Vernacular which have wide circulation in the State where the Personal Guarantor resides. The Resolution Professional shall furnish two spare copies of the notice to the Registry. One shall be placed by the Registry on this Authority's website and the other shall be affixed in the premises of this Authority. 8. The Resolution Professional in exercise of the powers conferred under Section 104 of IBC, 2016, shall prepare a list of creditors within 30 days from the date of the notice. The debtor shall prepare a Repayment Plan in consultation with the Resolution Professional as provided under Section 105, which shall include the provisions for payment of fee to the Resolution Professional. The Resolution Professional shall submit the Repayment Plan along with his report on the plan to this Adjudicating Authority within a period of 21 days from the last date of submission of claims, as provided under Section 106 of IBC, 2016. 9. In case the R ..... X X X X Extracts X X X X X X X X Extracts X X X X
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