Claims Based On Guarantee Can Be Considered By RP Even If Guarantee Was Not Invoked Before Insolvency Commencement Date: NCLAT

The National Company Law Appellate Tribunal (NCLAT) New Delhi bench of Justice Ashok Bhushan, Justice N. Seshasayee (Judicial Member) and Mr. Arun Baroka (Technical Member) has held that the claims of the creditor can be considered by the Resolution Professional even if guarantee based on which the claims were filed was not invoked. The present appeal has been filed under section 61 of the Insolvency and Bankruptcy Code, 2016 (IBC) against an order passed by National Company Law Tribunal (NCLT) by which it directed the Resolution Professional (RP) to consider the claims of the Indian Renewable Energy Development Agency Ltd. and made adverse observations against the RP and forwarded the order to the IBBI. The Appellant submitted that the facility which was extended by Respondent No.1, being fully satisfied by the Principal Borrower and no default has been committed by the Principal Borrower, hence, the claim of Corporate Guarantor on the basis of any uninvoked guarantee cannot be accepted. It was further argued that RP has not exceeded his jurisdiction in considering the claim and the reasons given in the emails rejecting the claim were bonafide reasons, which Appellant believed as per the statutory provisions and as per law as declared by this Tribunal. Hence, there was no occasion for making any adverse observation against the Appellant in the impugned order that act of the RP is in excess and abuse of the powers and duties of the RP. Per contra, the Respondent submitted that when the claim was based on corporate guarantee, the RP was obliged to admit the claim. The reasons given by the RP that no disbursement was made in favour of the CD is erroneous and contrary to law. The Tribunal noted that the Adjudicating Authority in the impugned order held that the RP acted in excess and beyond his powers under the IBC and directed a copy of the order to be forwarded to the IBBI. Since the adverse observations were made against the RP in which his conduct was questioned, the RP was fully entitled to file the present appeal. Accordingly, the objections with respect to maintainability of the appeal were rejected. The NCLAT in Export Import Bank held that the maturity of a claim or default of debt or invocation of guarantee has no nexus with filing of claim pursuant to public announcement. Similarly, the Supreme Court in China Development Bank held that even if right cannot be enforced by reason of the applicability of the moratorium, the claim will still exist. It was held that whether the cause of action for invoking the guarantee has arisen or not is not relevant for considering the definition of claim. It held that “the act of not verifying the claim by the RP and communicating email dated 13.07.2021 and 23.01.2021 giving reason for non-verification, cannot be said to be in excess and abuse of the duties of the RP. We, thus, are of the view that adverse observations made in paragraph 5(viii) against the RP, need to be deleted and further directions issued in paragraph 6(ii) forwarding copy of the order to IBBI is also needs to be deleted.” It held that the directions of the Adjudicating Authority to reconsider the claims of the Respondent cannot be faulted and the RP is mandated to comply. The Appellate Tribunal had only stayed the impugned order without restraining the reconsideration of the claim. Accordingly, if the claims of the Respondent have still not been considered, the RP shall consider the claims in accordance with the judgment. Accordingly, the present appeal was dismissed but the adverse remarks against the RP were deleted. Case Title: Hemant Sharma, Resolution Professional Today Homes and Infrastructure Pvt. Ltd. Versus Indian Renewable Energy Development Agency Ltd Case Number: Company Appeal (AT) (Insolvency) No.1039 of 2024 Judgment Date: 21/08/2025 Click Here To Read/Download The Order

Claims Based On Guarantee Can Be Considered By RP Even If Guarantee Was Not Invoked Before Insolvency Commencement Date: NCLAT

Mohd Malik Chauhan

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