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CS Professional · Insolvency and Bankruptcy - Law and Practice · Cross Border Insolvency (Elective 7.5)

CIRP of Kaveri Steels Ltd is pending before the NCLT, Chennai. The lenders now wish to proceed against Mr Raman, who gave a personal guarantee for Kaveri Steels' loan. Where must the application for the insolvency resolution of Mr Raman as personal guarantor be filed?

The application must be filed before the NCLT, Chennai. The Code requires that where the corporate debtor's resolution or liquidation is pending before an NCLT, applications relating to its personal or corporate guarantor go to that same Tribunal, whatever the guarantor's residence.

  1. ABefore the NCLT, Chennai, which is dealing with the corporate debtor's CIRPCorrect
  2. BBefore the Debt Recovery Tribunal where Mr Raman resides
  3. CBefore any High Court chosen by the lenders
  4. DBefore the NCLT bench nearest to Mr Raman's residence, regardless of the CIRP

Explanation

Under Section 60(2), while the corporate debtor's CIRP or liquidation is pending before an NCLT, an application relating to insolvency resolution or liquidation or bankruptcy of its personal guarantor must be filed before that same NCLT. The residence of the guarantor is therefore irrelevant here.

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