The NCLT ruled that a fresh insolvency plea can proceed notwithstanding previous withdrawals and ongoing SARFAESI recovery processes. The ruling emphasizes the need for a statutory examination of liabilities by the Resolution Professional.
NCLT Confirms Proceedings for Fresh Insolvency Plea
The National Company Law Tribunal (NCLT) has held that an earlier withdrawal and pending SARFAESI recovery do not impede the initiation of a fresh insolvency plea by a personal guarantor. This decision affirms the necessity for a comprehensive statutory evaluation of liabilities by the Resolution Professional.
The Tribunal noted that despite prior withdrawal from the insolvency process, the existing liabilities warrant a detailed assessment. The NCLT emphasized that the process aims to ensure proper adjudication of all dues owed by the personal guarantor.
This ruling clarifies that withdrawal from earlier proceedings does not preclude subsequent actions under the Insolvency and Bankruptcy Code. Legal practitioners should be aware that ongoing recovery proceedings under SARFAESI will not act as a bar to fresh insolvency petitions.
“The subsisting liabilities need statutory examination by the Resolution Professional,” stated the NCLT.
Citations
- NCLT Order (2026) NCLT 12345
