Bad loans and personal guarantees
May 30, 2021
The Insolvency & Bankruptcy Code marks one of the most significant changes made to commercial laws - Nuthawut Somsuk
The Insolvency & Bankruptcy Code marks one of the most significant changes made to commercial laws - Nuthawut Somsuk×
The SC verdict has brought relief to creditors waging long battles against bad loans
On May 21, 2021, the Supreme Court dismissed pleas on 75 petitions challenging the notification including that on Anil Ambani, Sanjay Singhal, Venugopal Dhoot, Kapil Wadhawan and 45 other industrialists. (The Supreme Court had declared the notification issued by the Union government under Insolvency and Bankruptcy Code, on November 15, 2019 as legal and valid).
‘Promoters, think before you sign that guarantee’
May 27, 2021
Bijoy Pulipra, Insolvency Professional and Company Secretary×
Assess first, future business and prospects
Entrepreneurs will be well advised to think twice before they sign the documentation for personal guarantee for their company and sign it only if they are fully convinced about the prospects and future of the business.
This is the most important takeaway from the Supreme Court’s clearing the ambiguity over partial notification of provisions in Part III of the Insolvency and Bankruptcy Code enabling creditors to invoke the personal guarantee of promoters of a corporate debtor, says Bijoy Pulipra, Insolvency Professional and Company Secretary.
SC Targets Promoter Wealth By Allowing Personal Guarantees To Be Invoked in IBC Cases
by R Jagannathan - May 24, 2021 06:32 AM
The Supreme Court of India. (SAJAD HUSSAIN/AFP/Getty Images)
Snapshot
The free lunch is over.
Last week, the Supreme Court struck a major blow against cronyism by holding that the personal guarantees given by businessmen can be called in even if their companies have filed for bankruptcy under the Insolvency and Bankruptcy Code (IBC).
A two-judge bench comprising Justice L Nageshwara Rao and Justice Ravindra Bhat upheld a 2019 amendment to the IBC which said that the personal guarantees given by promoters who took bank loans could be invoked even after insolvency proceedings are started.
Jaypee Infratech lenders to meet on Monday
May 23, 2021
NBCC challenged a decision by the CoC to consider only the bid submitted by Suraksha Group to acquire Jaypee’s stressed assets
NBCC challenged a decision by the CoC to consider only the bid submitted by Suraksha Group to acquire Jaypee’s stressed assets×
NBCC wrote to the company’s debt resolution professional Anuj Jain, questioning his jurisdiction and also sent clarification on the queries raised by the lenders
Jaypee Infratech’s lenders will meet on Monday to decide the future course of action on the submission made by state-owned NBCC. This comes after NBCC challenged a decision by the Committee of Creditors to consider only the bid submitted by Suraksha Group to acquire Jaypee’s stressed assets.