Six months after it transferred all the cases related to personal insolvency to itself, the Supreme Court has ruled that creditors can proceed against promoters of defaulting companies to recover debt if such promoters have given personal guarantees to secure funds. The top court has also said that lenders can also proceed against the promoters of a defaulting company even when the corporate insolvency resolution process of the firm itself has not been completed.
What did the Supreme Court say about personal insolvency under IBC?
One of the most important things that the SC has said is that mere approval of a resolution plan for a debt-laden company does not automatically discharge a promoter from their liability in lieu of the personal…
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