Nakul Gupta Vs State Bank of India (NCLAT Delhi)
“Whether resignation of a director revokes his personal guarantee or renewal of working capital facilities amounts to novation or variance under Sections 62, 129, 130 and 133 of the Contract Act in proceedings under Section 95 of the IBC? – Nakul Gupta Vs. State Bank of India and Anr. – NCLAT New Delhi”
Insolvency and Bankruptcy Code, 2016, Sections 95, 99; Indian Contract Act, 1872, Sections 62, 129, 130, 133 – challenge to admission of personal insolvency proceedings against personal guarantor on the grounds of resignation from directorship, alleged revocation of guarantee, and alleged novation/variance due to subsequent renewal of credit facilities. Held that the deed of guarantee dated 17.10.2017 made the guarantee payable on demand, continuing, irrevocable, and unaffected by future variation of terms; therefore, resignation of the appellant from the corporate debtor did not discharge him. Revocation under Section 130 required notice to the creditor, and no such notice was issued to SBI. The Tribunal further held that, qua SBI, there was no further enhancement or variation after the sanction dated 11.10.2017 and renewal of facilities would not amount to variation or novation under Section 62. The appellant’s reliance on Sections 129, 130 and 133 and on Dilip B Jiwrajka was rejected. The order admitting the Section 95 application on the Section 99 report was upheld and the appeal was dismissed.
