Imp rulings - Guarantor's Liability
Index;
Lalit Kumar Jain Vs, Union of India & Ors. [Transferred Case (CIVIL) NO. 245/2020]
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Supreme Court (21.05.2021) in Lalit Kumar Jain Vs, Union of India & Ors. [Transferred Case (CIVIL) NO. 245/2020] held that;
# 111. In view of the above discussion, it is held that approval of a resolution plan does not ipso facto discharge a personal guarantor (of a corporate debtor) of her or his liabilities under the contract of guarantee. As held by this court, the release or discharge of a principal borrower from the debt owed by it to its creditor, by an involuntary process, i.e. by operation of law, or due to liquidation or insolvency proceeding, does not absolve the surety/guarantor of his or her liability, which arises out of an independent contract.
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