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TMI Blog2024 (11) TMI 1286X X X X Extracts X X X X X X X X Extracts X X X X ..... arise only in two circumstance firstly, on the service of demand notice and secondly, within the period of 60 days from the receipt of demand notice. In fact the time was provided in the agreement to the guarantor to arrange payment of the lender to avoid legal complications. The right to file the petition under Section 95 thus would not arise after 14 days of service of the notice in view of the specific agreement between the parties that after the demand notice is served, 60 days time shall remain available with the guarantor for discharging his liability whereas in the present case the demand notice is dated 01.11.2021 and the application was filed on 01.12.2021, just after the expiry of one month, which is contrary to clause 3 of the agreement. It is obvious from the dates because the petition under Section 9 of the Act was filed by Respondent No. 1 on 30.11.2021 and when the case was adjourned to 03.12.2021 for orders, the petition under Section 95 was filed on 01.12.2021 as a result of which the petition filed under Section 9 had to be adjourned by the Hon ble Bombay High Court. There are no error in the findings recorded by the Tribunal for not only allowing the application ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e default having been committed by the Borrower in repayment of the said amount to the Neon and will pay the amount demanded forthwith on receipt of the demand notice. Any such demand notice sent by the Neon by hand delivery or by post to the Guarantor at his address mentioned hereinabove or such address as may be known to the Neon shall be deemed to be duly served on the Guarantor at the time when the notice would in the ordinary course of the post be delivered at such address. It is agreed that the Neon may in its sole discretion invoke this Guarantee. 4. Mr. Mayank Shah (Intervenor/Respondent No. 1) filed an Arbitration Petition No. 304 of 2021 before the Hon ble Bombay High Court under Section 9 of the Arbitration and Conciliation Act, 1996 (in short Act ), inter alia, for depositing the claim amount of Rs. 131,02,82,634/-. 5. It is alleged that when the arbitration petition, filed by Respondent No. 1, was at the stage of passing of the orders against Respondent No. 2 (personal guarantor/debtor), the Appellant filed a petition under Section 95 of the Code and in view of Section 96 of the Code, interim moratorium became operative and the arbitration proceedings were postponed by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n ble Bombay High Court for decision but because of Section 96, the proceedings have been adjourned sine die and on that account not only the application no. 2044 of 2022 filed by Respondent No. 1 has been disposed of in his favour but also CP (IB) No. 794 of 2022 filed by the Appellant was held to be premature and collusive, has been dismissed with costs of Rs. 5 lac. 9. Counsel for the Appellant has vehemently argued that period of service of demand notice has to be counted in terms of Section 95(4)(b) of the Code and the period mentioned in the guarantee agreement should not be taken into consideration. It is submitted that Section 238 of the Code overrides the provisions of Indian Contract Act and in this regard, reference has been made to a decision of this Court in the case of K.V Jayaprakash Vs. State Bank of India Anr., CA (AT) (Ins) No. 362 of 2022 decided on 30.09.2022. He has also submitted that the allegation of collusion has to be proved on the basis of the evidence and relied upon a decision of the Hon ble Supreme Court in the case of Ratnagiri Gas and Power (P) Ltd. Vs. RDS Projects Ltd., (2013) 1 SCC 524. 10. On the other hand, Counsel for Respondent No. 1 has submi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h means that the period of 60 days is provided to the personal guarantor from invocation of the guarantee by the lender. In case the amount is paid within this period then no petition under Section 95 could have been filed and in case the amount is not paid within 60 days, despite demand having been raised, the petition under Section 95 can be filed. 11. We have heard Counsel for the parties and perused the record with their able assistance. 12. The facts are not in dispute that a personal guarantee deed was executed on 27.07.2011 amongst the Appellant as a lender, SPIL as the Borrower and Respondent No. 2 as the Guarantor. Clause 3 of the said agreement categorically lays down that the Guarantor would pay the amount of ICD of Rs. 1 Cr. 75 Lac to the lender within 60 days from the date of demand notice served by the Lender requiring the payment. Therefore, from the plain reading of this clause it is apparent that the liability to pay by the Guarantor to the lender shall arise only in two circumstance firstly, on the service of demand notice and secondly, within the period of 60 days from the receipt of demand notice. In fact the time was provided in the agreement to the guarantor t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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