MUMBAI: The panel reviewing the Insolvency and Bankruptcy Code (IBC) has proposed that lenders to defaulting companies should be allowed to invoke personal guarantees, which in most cases are those of the promoters, even if the resolution process has been initiated, said people with knowledge of the matter.
If accepted, this will be a significant move in the light of a recent decision by the National Company Law Appellate Tribunal (NCLAT) that State Bank of India cannot invoke personal guarantees and liquidate assets in the case of Veesons Energy, which is facing bankruptcy proceedings.
The tribunal took the view that once a company is admitted to the National Company Law Tribunal (NCLT) under the IBC process, a moratorium gets trigger…
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