Banks to appraoch NCLT to invoke personal guarantee of promoters
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Mumbai: Several leading banks have started moving the National Company Law Tribunal (NCLT) to invoke the personal guarantees given by promoters of defaulting companies.
According to banking sources, leading banks, including State Bank of India (SBI), Bank of Baroda (BOB), and Union Bank of India (UBI) have approached different benches of NCLT to invoke the personal guarantee of 17 big defaulters including Atul Punj of Punj Lloyd (Rs 3,000 crore), Sanjay Singal of Bhushan Power and Steel (Rs 47,150 crore), and Wadhawans of DHFL (Rs 79,000 crore).
Sources says that banks have decided that for invoking the personal guarantees, only the lead lender in each case will go to the NCLT.
The other big names in the list of personal guarantors, against whom banks have initiated legal action, include Sabbineni Surendra of Coastal Projects Ltd (Rs 4,700 crore), Arun Dham of Amtek Auto (Rs 12,650 crore), Rishi Agarwal of ABG Shipyard (Rs 1,800 crore), Venugopal Dhoot of Videocon (Rs 22,000 crore), Yudhistir Khaitan of Varun Shipping (Rs 4,000 Crore), L. Madhusudan Rao of Lanco (Rs 11,000 crore) and R M Garg of DMI Finance Limited (Rs 2,953 crore).
In all these cases applications have been filed by the banks before the NCLT Benches in Delhi, Ahmedabad, Kolkata and Mumbai.
Top 10 personal guarantors have guaranteed a total Debt of over Rs 1.6 lakh crore.
The Supreme Court in May had held that the November 15, 2019 government notification allowing creditors, usually financial institutions and banks, to move against personal guarantors under the Insolvency and Bankruptcy Code (IBC) was 'legal and valid'.