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2021 (7) TMI 455 - AT - Insolvency and BankruptcyValidity of parallel proceeding filed against the Principal Borrower - already CIRP had been initiated against the Corporate Guarantor and the claim of the Financial Creditor had already been accepted in the CIRP for the whole amount - HELD THAT - Section 60(2) of IBC itself makes it clear that if CIRP or liquidation proceeding of a Corporate Debtor is pending before a National Company Law Tribunal, an Application relating to Insolvency Resolution of a Corporate Guarantor or Personal Guarantor, as the case may be, of such Corporate Debtor is filed it shall be filed before such National Company Law Tribunal - This Section speaks for itself that the parallel proceedings against borrower and guarantor are maintainable. Appeal disposed off.
Issues:
1. Parallel insolvency proceedings against the principal borrower and corporate guarantor. Analysis: The case involved an appeal filed by the appellant, a shareholder of a company, against an order passed by the Adjudicating Authority under the Insolvency and Bankruptcy Code, 2016 (IBC). The main issue was the parallel insolvency proceedings initiated against the principal borrower and the corporate guarantor. The appellant argued that a Corporate Insolvency Resolution Process (CIRP) had already been initiated against the corporate guarantor, and the claim of the financial creditor had been accepted in that process. The appellant contended that for the same debt, there cannot be two CIRPs, citing judgments in the cases of "Dr. Vishnu Kumar Agarwal v. M/s. Piramal Enterprises Ltd." and "State Bank of India v. Athena Energy Ventures Pvt. Ltd." The appellant raised objections to the parallel proceedings, citing written submissions filed before the Adjudicating Authority. However, the Adjudicating Authority did not address this issue in the impugned order. The appellant argued that the judgment in the "Dr. Vishnu Kumar Agarwal" case established the principle that two CIRPs cannot be initiated for the same debt. On the other hand, the appellant claimed that the judgment in the "State Bank of India v. Athena Energy Ventures Pvt. Ltd." case was per incuriam and should not be followed. The appellant contended that the Adjudicating Authority failed to address these arguments properly. Upon review, the tribunal found that the judgment in the "Athena Energy" case was not per incuriam and consciously distinguished the "Piramal Enterprises" judgment. The tribunal emphasized Section 60(2) of the IBC, which allows for parallel proceedings against a corporate debtor and its guarantor if a CIRP or liquidation proceeding is pending. The tribunal concluded that the appeal lacked substance on the legal issue of maintainability. Despite the Adjudicating Authority's failure to specifically address the issue, the tribunal declined to admit the appeal, stating that there was no reason to remand the case for further consideration. Consequently, the appeal was disposed of accordingly.
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