NCLAT determined that invocation of corporate guarantee after ...

Corporate Guarantee Invoked After CIRP Initiation Invalid Under Section 14 IBC Moratorium, Claim Not Admissible

February 11, 2025

Case Laws IBC AT

NCLAT determined that invocation of corporate guarantee after CIRP commencement is impermissible under Section 14 IBC moratorium provisions. The corporate guarantee was invoked on 18.09.2020, subsequent to CIRP initiation date of 27.01.2020. Following precedents from SC in Ghanshyam Mishra and NCLAT in Edelweiss Asset Reconstruction, the tribunal held that claims based on guarantees invoked post-CIRP cannot be admitted as they had not matured when CIRP commenced. The guarantee should have been invoked prior to CIRP initiation for any valid claim. The appeal was allowed, invalidating the respondent's claim filed based on post-CIRP guarantee invocation, as it violated moratorium restrictions under IBC.

View Source

← Previous Next →

NCLAT determined that invocation of corporate guarantee after ...

Corporate Guarantee Invoked After CIRP Initiation Invalid Under Section 14 IBC Moratorium, Claim Not Admissible

February 11, 2025

Case Laws IBC AT

You may also like:

IBC - Invoking Bank Guarantee - Corporate Debtor has issued bank guarantee for ensuring the price of goods. The bank guarantee is irrevocable and unconditional and...

Rejection of the simultaneous claim by the Resolution Professional of the Corporate Debtor - Claim filed by the Applicant with respect to the corporate guarantee given...

Maintainability of an application for initiation of Corporate Insolvency Resolution Process (CIRP) u/s 9 of the Insolvency and Bankruptcy Code (IBC). The key points are:...

The NCLAT dismissed the appeal and upheld the NCLT order, ruling that u/s 14 of the IBC, 2016, a security deposit lying with a third party cannot be adjusted against...

IBC - The moratorium order passed by this Tribunal applies in respect of Bank Guarantees other than Performance Guarantees furnished by the Corporate Debtor in respect...

Initiation of CIRP - It is true that the ‘Corporate Debtor’ had taken guarantee but the said guarantee was not invoked in favour of the Appellant - Appellant make...

The Appellate Tribunal held that the Performance Bank Guarantee could be invoked during the moratorium period u/s 14 of IBC. Referring to a Supreme Court case, it...

The Appellate Tribunal held that the Annual Mine Closure Cost (AMCC) deposited by the Corporate Debtor in an Escrow Account belongs to the Corporate Debtor and cannot be...

Impact of Section 60(6) of the IBC - Exclusion of moratorium period for initiation of proceedings of suit - Interpreting the statute in the manner which the appellant...

Maintainability of petition seeking initiation of CIRP against Personal Guarantor/Respondent - invocation of Bank guarantee and time limitation - The case involved an...

CIRP in progress - moratorium in effect - recovery of dues from NPA - It is claimed that since the moratorium under Section 14 of the IBC has ceased to subsist after the...

CIRP initiated against the Corporate Debtor terminated upon reaching full and final settlement with the Operational Creditor who filed Section 7 application. Quantum of...

Initiation of CIRP - The corporate debtor has tried to challenge the genuinely of the corporate guarantee agreement but the same is a lame excuse. It seems that...

CIRP - Corporate Guarantee and Liability - The Appellate Tribunal acknowledged that the company had issued corporate guarantees to financial institutions. Despite the...

NCLAT upheld dismissal of Section 7 application as barred under Section 10A of IBC, 2016. The tribunal found that IDBI Bank's guarantee invocation on 05.03.2021 falls...

Quick Updates: