Ram Kishor Arora vs Ifci Ltd
- CitationComp. App. (AT) (Ins) No. 550 of 2025
Ratio decidendi
The rule this decision rests on
The pendency of proceedings under Section 7 of the Insolvency and Bankruptcy Code against the corporate debtor is not, by itself, a ground to fault the admission of an application under Section 95(1) against its personal guarantor, because the liability of the personal guarantor and the corporate debtor to the lenders is co-extensive, and the lender may proceed against both simultaneously or separately. A personal guarantor's application for personal insolvency may be considered on its merits notwithstanding the pendency of a corporate insolvency proceeding, and any settlement with the lender or other proceedings pending before a higher forum may be placed before the Resolution Professional, who must consider all material brought forward by the personal guarantor in the personal insolvency proceedings.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
Ram Kishor Arora ...Appellant(s)
Versus
IFCI Ltd. & Anr. ...Respondent(s) Present: For Appellant : Mr. Krishnendu Datta, Sr. Advocate with Mr. Lokesh Malik, Ms. Atika Chaturvedi, Advocates. For Respondents : Mr. Amish Tandon, Ms. Anushree Kulkarni, Mr. Swankit, Advocates for IFCI (Caveat).
ORDER
(Hybrid Mode) 07.04.2025: This appeal has been filed by the appellant Personal
Guarantor of the Corporate Debtor Supertech Ltd. challenging the order
dated 04.02.2025 by which Section 95 (1) application filed by the IFCI Ltd.
has been admitted.
2. Ld. Counsel for the Appellant submits that the proceedings under
Section 7 which were commenced against the Corporate Debtor are engaging
the attention of the Hon'ble Supreme Court in Civil Appeal No. 2626 of 2025
in which Hon'ble Supreme Court has passed an order on 21.02.2025 by
asking the promoters of the CD and third parties to submit settlement plan
and the process is already pending before the Supreme Court and the CD,
promoters and other parties are submitting plan for construction and
settlement.
3. Be that as it may, we are of the view that the personal insolvency
proceedings are not defended on proceedings under Section 7 which are
proceedings against the Corporate Debtor, the liability of the personal
guarantor and the CD to the lenders are co-extensive and it is open for the
lenders to proceed against both simultaneously or separately.
4. The appellant further submits that the proposal has also been sent
to IFCI Bank with an OTS Proposal which is pending consideration.
5. We after hearing the Counsel for the Appellant, are of the view in so far as the admission of application under Section 95, that cannot be faulted on the ground of pendency of proceedings under Section 7 against CD. It is however open for the appellant bring before the RP settlement with IFCI Bank if any, or any proceedings or any settlement which is entered into the proceedings under Section 7 which are pending consideration before the Hon'ble Supreme Court.
6. Subject to above liberty, we dismiss the appeal.
7. It goes without saying that all material which are brought by the appellant be duly considered by the RP for proceeding further in the personal insolvency proceedings.
[Justice Ashok Bhushan] Chairperson
[Barun Mitra] Member (Technical) sr/nn
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