N The Matter of

UNIVERSITY MOOT COURT SELECTIONS, GRAND INTRA, 2020
MEMORIAL ON BEHALF OF THE RESPONDET
T-61
UNIVERSITY MOOT COURT COMPETITION, GRAND INTRA, 2020
IN THE HON’BLE SUPREME COURT OF INDIA
UNDER THE SPECIAL LEAVE PETITION
ENSHRINED UNDER ARTICLE 136 OF THE CONSTITUTION OF INDIA
SPECIAL LEAVE PETITION (CIVIL) ****/2020
IN THE MATTER OF:
PROFESSOR………………..……………………………………………….PETITIONER
Vs.
ROYAL BANK OF SPRAIN AND OTHERS………..…..………………RESPONDENTS
ON SUBMISSION TO THE SUPREME COURT OF INDIA
MEMORIAL FOR THE RESPONDENTS
I
TABLE OF CONTENTS
LIST OF ABBREVIATIONS .................................................................................................. III
INDEX OF AUTHORITIES....................................................................................................IV
STATEMENT OF JURISDICTION..................................................................................... VIII
STATEMENT OF FACTS ......................................................................................................IX
ISSUES RAISED .....................................................................................................................XI
SUMMARY OF ARGUMENTS ........................................................................................... XII
ARGUMENTS ADVANCED ................................................................................................... 1
[ISSUE I]: THE NOTIFICATION DATED 15.11.2019 EMPOWERS RBS TO HAVE

LOCUS TO INITIATE PARALLEL PROCEEDINGS AGAINST HAPL AND THE
PROFESSOR FOR THE SAME DEBT. ............................................................................... 1
[I.A]: Suspension of Parallel Proceeding would be Anathema to the Scheme and Object
of the Code. ........................................................................................................................ 1
[I.B]: There is No Exclusive Provision in the Code which Bars initiating proceeding
against the Guarantor. ........................................................................................................ 2
[I.C]: The Principle of Coextensive Liability of Guarantor and Debtor under Contract Act,
cannot be undermined. ....................................................................................................... 3
[ISSUE II]: THE APPROVAL OF THE RESOLUTION PLAN BY THE NCLT DOES NOT
PROHIBIT THE INITIATION OF PROCEEDINGS AGAINST PROFESSOR IN CP(IB)-
22(ND)/2020. ......................................................................................................................... 4
[II.A]: The Approval of the Resolution Plan by the NCLT on 30.05.2020 militates against
the Professor....................................................................................................................... 4
[II.B]: Approval of Resolution Plan Does Not Discharge Guarantor under the Indian
Contract Act, 1872. ............................................................................................................ 5
[ISSUE III]: THAT THE OBLIGATIONS OF PROFESSOR UNDER THE DEED OF

GUARANTEE DATED 15.08.2018 DOES NOT STAND DISCHARGED UNDER
APPLICABLE LAW. ............................................................................................................ 7
[III.A]: Liability of Guarantor is Co-Extensive with that of Principal Debtor. ................. 7
I
[III.B]: Liability of Guarantor Does Not Dispense Off if the Principal Debtor is
Discharged as Result of Due Process of Law. ................................................................... 9
[ISSUE IV]: THE NOTIFICATION BRINGING IN EFFECT PART III OF THE CODE
ONLY IN RELATION TO PERSONAL GUARANTOR TO CORPORATE DEBTOR IS
VALID AND CONSTITUTIONAL. ................................................................................... 11
[IV.A]: Considerations to be made while deliberating upon Constitutionality of

legislation. ....................................................................................................................... 11
[IV.B]: The Notification satisfies the Test of Classification ........................................... 12
[IV.C]: Meaningful reading of the IBC, Guarantor Rules and Guarantee Regulations shall
establish that Part III has been specifically made applicable to guarantors. .................... 15
[IV.D]: Part III does not affect the CIRP process of HAPL. ........................................... 15
[ISSUE V]: THE HON’BLE DELHI HIGH COURT HAS NO THE JURISDICTION TO
ENTERTAIN THE W.P. (C) 3911/2020. ............................................................................ 16
[V.A]: IBC is a Complete Code and Eludes the Role of HC in the Adjudicatory
Mechanism. ...................................................................................................................... 16
[V.B]: Intervention by The High Court would render the Object of the Code Meaningless.
.......................................................................................................................................... 17
[V.C]: The High Court cannot assume Jurisdiction under Article 226 in the present matter.
.......................................................................................................................................... 17
[V.D]: The IBC provides for the Alternate and Equally Efficacious Remedies. ............. 18
PRAYER ...............................................................................................................................XIV
II
LIST OF ABBREVIATIONS
¶ Paragraph
AIR All India Reporters
SCC Supreme Court Cases
SC Supreme Court
V Versus
Ltd Limited
Ors Others
SCR Supreme Court Reports
US United States
UN United Nations
Art Article
S Section
ICA Indian Contract Act
NCLT National Company Law Tribunal
NCLAT National Company Law Appellate Tribunal
CD Corporate Debtor
ARPL Arturo Rex Pvt. Ltd.
HAPL Heist Artillery Private Limited
RBS Royal Bank of Sprain
Pvt Private
HC High Court
Ker Kerala
CoC Committee of Creditors
IBC Insolvency and Bankruptcy Code
CIRP Corporate Insolvency Resolution Process
III
INDEX OF AUTHORITIES
Cases
ABL International Ltd v Export Credit Guarantee Corporation of India Ltd (2004) 3 SCC 553.
.............................................................................................................................................. 19
Anthony Raphael Kallarakka v NCLT 2018 SCC OnLine Bom 13865. .................................. 19
Aryan Mining and Trading Corporation Private Limited v Ganesh Sponge Private Limited
2017 SCC OnLine NCLT 7514. .......................................................................................... 17
Bal Krishna v Atma Ram AIR 1948 Nag 277. ........................................................................... 5
Bank of Bihar Ltd v Damodar Prasad AIR 1969 SC 297. ........................................................ 8
Bank of India v Gupta Infrastructure (India) Ltd 2018 SCC OnLine NCLT 5865................... 5
Basant Kumar Sarkar v Eagle Rolling Mills AIR 1984 SC 1260............................................ 13
Bhavesh D Parish v Union of India (2000) 5 SCC 471. .......................................................... 12
Biswambhar Singh v State of Orissa AIR 1954 SC 139. ......................................................... 14
BMD (P) Ltd v SVL Ltd [2018] 98 taxmann.com 61. ................................................................ 5
BN Nanjappa v Sangli Bank Ltd 1998 SCC OnLine Kar 617. ................................................ 10
BR Enterprises v State of UP (1999) 9 SCC 700. .................................................................... 12
CCE v Dunlop India Ltd AIR 1985 SC 330. ........................................................................... 19
Charanjit Lal v Union of India AIR 1951 SC 41. ................................................................... 12
Commissioner of Income Tax v Chhabil Das Agarwal (2014) 1 SCC 603. ............................ 18
Committee of Creditors of Essar Steel Ltd v Satish Kumar Gupta 2019 SCC OnLine SC 1478.
.............................................................................................................................. 2, 10, 13, 18
Edelweiss Asset Reconstruction Company v Vijay Kumar V Iyer RP of Murli Industries Ltd
(2019) SCC OnLine NCLAT 374. ....................................................................................... 20
Ferro Alloys Corporation Ltd v Rural Electrification Corporation Ltd CP (IB) No
251/KB/2917. ....................................................................................................................... 13
Gouri Shankar Jain v Punjab National Bank 2019 SCC OnLine Cal 7288. ..................... 2, 4, 6
Harbanslal Sahnia v Indian Oil Corporation AIR 2003 SC 2120. ......................................... 20
Hukumchand Insurance Co Ltd v The Bank of Baroda & Others AIR 1977 Kant 204. ........... 3
In re Delhi laws Act, 1912 1951 AIR 332. .............................................................................. 11
In re Garner’s Motor Ltd (1937) 1 Ch 594................................................................................ 6
In re Jacobs 98 NY 98 (1885). .................................................................................................. 9
Indian Overseas Bank v G Ramulu (1999) 2 ALD 104. ........................................................ 5, 7
IV
Industrial Finance Corporation of India Ltd v Canonnore Blending and Weaving Mills Ltd and
Ors AIR 2002 SC 1814. ....................................................................................................... 10
Industrial Investment Bank of India Ltd v Biswanath Jhunjhunwal (2009) 9 SCC 478.
............................................................................................................................................ 3, 8
Innoventive Industries Ltd v ICICI Bank (2018) 1 SCC 407. ............................................ 16, 18
Jagannath Ganeshram Agarwala v Shivnarayan Bhagirath and Ors AIR 1940 Bom 247. . 3, 6
Kailash Chand Jain v UP Financial Corporation AIR 2002 All 302. ...................................... 8
Kangshari Haldar v State of West Bengal AIR 1960 SC 457. ................................................ 14
L Chandra Kumar v Union of India (1997) 3 SCC 261. ......................................................... 19
Laxmi Khandsari v State of Uttar Pradesh (1981) 2 SCC 600................................................ 13
Liberty House Group Pte Ltd v State Bank of India and Others 2019 SCC OnLine Del 7256.
.............................................................................................................................................. 17
M/s Embassy Property DevelopmentsPvt Ltd v State of Karnataka &Ors 2019 SCC OnLine
SC 154.................................................................................................................................. 20
M/s Tata Iron and Steel Co Ltd v Workmen of M/s Tata Iron and Steel Co Ltd AIR 1972 SC
1917...................................................................................................................................... 12
Mahabir Shum Sher v Lloyds Bank AIR 1968 Cal 371. ............................................................ 7
Maharashtra State Electricity Board v Official Liquidator AIR 1982 SC 1497. .................. 6, 9
Medisetti Ravi Babu v Pramida Chit Fund (P) Ltd (2003) 2 BC 527. ...................................... 8
Minerva Mills v Union of India (1986) 4 SCC 222. ................................................................ 18
Munn v Illinois 1876 SCC OnLine US SC 4. .......................................................................... 12
Naba Kishore Sahoo v United Bank of India 1995 AIHC 2176. ............................................... 8
PUCL v Union of India (2004) 2 SCC 476. ............................................................................. 12
Punjab National Bank v Lakshmi Industrial & Trading Co (P) Ltd AIR 2001 All 28. .......... 11
R Thiagarajan v South Indian Bank Ltd ILR 1987 1 Ker 370. ................................................ 10
Ram Kishun v State of Uttar Pradesh (2012) 11 SCC 511. ....................................................... 8
Ram Roop v Bishwa Nath AIR 1958 All 456. ......................................................................... 19
RK Dewan v State of UP (2005) All LJ 2067. ......................................................................... 10
RK Garg v Union of India (1981) 4 SCC 675. ........................................................................ 12
SadhanaLodh v National Insurance Co (2003) 3 SCC 524..................................................... 19
Sampath Kumar v Union of India (1985) 4 SCC 458. ............................................................. 18
SAS Hospitality Pvt Ltd v Surya Construction Pvt Ltd 2018 SCC OnLine Del 11909. .......... 18
Shivam Water Treaters Pvt Limited v Union of India 2017 SCC OnLine SC 1920. ............... 20
V
State Bank of India v V Ramakrishnan (2018) 17 SCC 394. ............................................passim

State of Bihar and Ors v Jain plastic and chemicals Ltd (2002) 1 SCC 216. ......................... 19
State of Gujarat v State Bank of Saurashtra (2004) 1 GLR 213. ............................................ 11
Swetambar Sthanakwasi Jain Samiti v Alleged Committee of Management Sri RJI College
(1996) 3 SCC 11. ................................................................................................................. 19
Swiss Ribbons (P) Ltd v Union of India (2019) 4 SCC 17. ..................................................... 12
Syndicate Bank v K Manohara AIR 2003 Ker 284.................................................................... 7
Thakur Das v Phagwa AIR 1936 Peshwar 150. ........................................................................ 9
TMA Pai Foundation v State of Kerala AIR 2003 SC 355...................................................... 14
Union Bank of India v Satyawati Tandon (2010) 8 SCC 110. ................................................. 19
UP Financial Corporation v Garlon Polyfeb Industries and Others AIR 2001 All 286. ......... 8
Vasanlal Maganbhai Sanjanwala and the Pratap Spinning and Manufacturing Co Ltd v State
of Bombay AIR 1961 SC 4................................................................................................... 12
Wolverhampton New Waterworks Co v Hawkesford (1859) 6 CBNS. .................................... 19
Statutes
Insolvency and Bankruptcy Code 2016, s 1(3). ....................................................................... 11

Insolvency and Bankruptcy Code 2016, s 231......................................................................... 17
Insolvency and Bankruptcy Code 2016, s 238........................................................................... 9
Insolvency and Bankruptcy Code 2016, s 31(1). ............................................................... 4, 6, 7
Insolvency and Bankruptcy Code 2016, s 5(22). ..................................................................... 15
Insolvency and Bankruptcy Code 2016, s 60(2). ....................................................................... 1
Insolvency and Bankruptcy Code 2016, s 60........................................................................... 19
Insolvency and Bankruptcy Code 2016, s 7............................................................................. 13
Insolvency and Bankruptcy Code 2016, s 95............................................................................. 1
The Indian Contract Act 1872, s 128. .......................................................................... 3, 5, 7, 13
The Indian Contract Act 1872, s 133. .................................................................................... 4, 6
The Indian Contract Act 1872, s 134. ........................................................................................ 5
The Insolvency and Bankruptcy Code (Amendment) Act 2017, s 10. ...................................... 2
The Insolvency and Bankruptcy Code (Amendment) Act 2017, s 2 (e). ................................. 15
Rules
The Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency

Resolution Process for Personal Guarantors to Corporate Debtors) Rules 2019, r 3(e). ..... 16
VI
Constitutional Provisions
The Constitution of India 1950, art14. ..................................................................................... 14
Books
Halsbury’s Laws of England (4th edn, 1989) vol 3, para 880. .................................................. 9
Rowlatt, The Law of Principal and Surety (3rd edn, 1936) 277. ............................................. 10
Articles
Pradip Thakur, ‘High Court Judges Get Just 5-6 Minutes to Decide Cases, says Study’ The
Times of India (7 April 2016). ............................................................................................. 17
Reports
Law Commission of India, 272th Report on Assessment of Statutory Framework of Tribunals

in India (2007). .................................................................................................................... 18
Ministry of Corporate Affairs, Report of Insolvency Law Committee (2020) para 6.5. ............ 2
VII
STATEMENT OF JURISDICTION
The Respondent, i.e. Royal Bank of Sprain [RBS], Insolvency and Bankruptcy Board of India
and Government of India (through Ministry of Corporate Affairs) humbly submit to the
jurisdiction of the Hon’ble Supreme Court of India under Article 136 of the Constitution of
India in response to the petition filed by the petitioner.
ARTICLE 136: SPECIAL LEAVE TO APPEAL BY THE SUPREME COURT
1) Notwithstanding anything in this Chapter, the Supreme Court may, in its discretion, grant
special leave to appeal from any judgment, decree, determination, sentence or order in any
cause or matter passed or made by any court or tribunal in the territory of India.
(2) Nothing in clause (1) shall apply to any judgment, determination, sentence or order passed
or made by any court or tribunal constituted by or under any law relating to the Armed Forces.
VIII
STATEMENT OF FACTS
Heist Artillery Private Limited (“HAPL”) is a company registered under the laws of India is
the leading manufacturer of defence equipment and related activities in the Union of India,
based out of New Delhi. HAPL was conceptualized by Mr. Professor and Mr. Berlin (also
directors and shareholders of HAPL). Initially, the business of HAPL was confined to
manufacture of local weaponry for the State and the Police. However, with constant effort
Professor and Berlin, HAPL quickly gained face as the biggest defence and arms
manufacturing unit in whole of India and opened new unit to deal exclusively with purchase
order across the world in Manesar.
In view of requirement for funds, Professor and Berlin approached the Royal Bank of Sprain
(“RBS”), headquartered in New Delhi in order to avail certain loan facilities. Upon an
assessment of the credit worthiness of HAPL and its directors/guarantors, RBS agreed to
sanction vide the Term Loan Agreement dated 15.05.2018 a business loan to the tune of Rs.
6,00,00,00,000/- (Rupees Six Hundred Crores) to HAPL (“TLA”). As per the terms of the
TLA, the repayment was to be done within the next five years in a phased manner along with
applicable interests. Alongside the said TLA, RBS also insisted upon and secured the
repayment of the loan sanctioned by way of various agreement dated 15.05.2018: namely
Mortgage Deed and Hypothecation deed btw. HAPL and RBS, also, RBS signed two separate
guarantee deed with both Professor and Berlin distinctly.
Till March 2019, HAPL duly paid 1,00,00,00,000. That was only in August 2019 that their
account was declared as NPA by RBS, owing to its default in repayment obligation. Since,
settlement talks failed between two, RBS filed an application under Sec. 7 of IBC before
NCLT, Delhi seeking to initiate the CIRP of HAPL on 25.08.2019. Vide an order dated
20.10.2019, the NCLT admitted the application and issued moratorium under Sec.14 of IBC in
relation to the assets of HAPL, thereby commencing the CIRP of HAPL. An appeal against
this order was dismissed by both NCLAT and Supreme Court.
The NCLT in conformity with Committee of Creditors appoints Ms. Rachel as the Resolution
Professional. Thereafter, claims from all the creditors were invited pursuant to a Public
Announcement. While preparing the Information Memorandum, the RP also examined various
guarantees furnished by promoters/directors of HAPL, including guarantee of Berlin and
Professor. RBS claim of Rs. 5,00,00,00,000/- (Rupees Five Hundred Crores) along with
interest was admitted by the RP – thus making RBS the lead financial creditor in the COC of
IX
HAPL by debt value and voting percentage. On 30.03.2020, the COC approved the Resolution
Plan filed by Arturo Rex Pvt. Ltd., the said Resolution plan was approved by the COC including
RBS in terms of Sec. 30(4) of the IBC. RBS in the said plan reserves its right to invoke
independent contract against the stakeholders and that entire approved amount to the tune of
75% must be paid within 180 days from the approval of Plan by adjudicatory authority.
Thereafter, an application dated 04.04.2020 under Sec. 31(1) was filled by ARPL and RP
before NCLT, which was only approved on 30.05.2020, owing to COVID-19 pandemic.
Meanwhile, certain provisions of Part III of the IBC were notified vide a notification dated
15.11.2019 (w.e.f. 01.12.2019), issued by the Ministry of Corporate Affairs, only insofar as
they relate to personal guarantors to corporate debtors. On 15.06.2020, to the surprise of
Professor and Berlin RBS invoked the deeds of guarantees dated 15.08.2018, in accordance
with which demand notice dated 15.06.2020 was issued to both of them under Sec.95(4)(b) of
IBC read with Rule 7(1) of the ‘Insolvency and Bankruptcy (Application to Adjudicating
Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors)
Rules, 2019’ issued by the Ministry of Corporate Affairs, Government of India (“Guarantor
Rules”) under Form B of the said Guarantor Rules for the entire debt along with interest. Both
of them decided not to respond to notice served to them on 17.06.2020. In pursuant of this,
RBS filed an Application under Section 95 of IBC read with the Guarantor Rules and the
‘Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Personal
Guarantors to Corporate Debtors) Regulations, 2019’ issued by the Insolvency and Bankruptcy
Board of India before NCLT Delhi, seeking to initiate the insolvency resolution process of the
Professor. Thus, an interim moratorium in terms of Section 96 of the IBC came into effect on
22.07.2020, thereafter the NCLT admitted the said Application preferred by RBS and issued a
moratorium under Sec. 101 of the IBC.
On 01.08.2020, the Order dated 22.07.2020 was challenged by the Professor before the Hon’ble
Delhi High Court vide a Writ Petition being W.P. (C) 3911/2020 titled ‘Professor v Royal Bank
of Sprain and Others’. The Government of India (through the Ministry of Corporate Affairs)
and the IBBI were also impleaded as Respondent Nos. 2 and 3 respectively to the said Writ
Petition. Thereafter, the said writ petition which was initially stayed impugned Order, was
eventually dismissed vide the Judgement dated 02.09.2020.
X
ISSUES RAISED
[ISSUE 1]
WHETHER RBS HAD THE LOCUS TO INITIATE PARALLEL PROCEEDINGS AGAINST HAPL AND
PROFESSOR BY WAY OF CP (IB)-11(ND)/2019 AND CP(IB)-22(ND)/2020?
[ISSUE 2]
WHETHER THE APPROVAL OF THE RESOLUTION PLAN BY THE NCLT PROHIBITS THE INITIATION
OF PROCEEDINGS AGAINST PROFESSOR IN CP(IB)-22(ND)/2020?
[ISSUE 3]
WHETHER THE OBLIGATIONS OF PROFESSOR UNDER THE DEED OF GUARANTEE DATED
15.08.2018 STAND DISCHARGED UNDER APPLICABLE LAW?
[ISSUE 4]
WHETHER THE NOTIFICATION DATED 15.11.2019 AND THE SECTIONS NOTIFIED THEREIN UNDER,
THE GUARANTOR RULES AND THE GUARANTOR REGULATIONS ARE ALL ULTRA VIRES THE IBC
AND THE CONSTITUTION OF INDIA?
[ISSUE 5]
WHETHER THE HON’BLE DELHI HIGH COURT HAD THE JURISDICTION TO ENTERTAIN THE W.P.
(C) 3911/2020?
XI
SUMMARY OF ARGUMENTS
[ISSUE I]: RBS DOES HAVE THE LOCUS TO INITIATE PARALLEL

PROCEEDINGS AGAINST HAPL AND PROFESSOR BY WAY OF CP(IB)-
11(ND)/2019 AND CP(IB)-22(ND)/2020.
The provisions of the IBC read with the Guarantor Rules and Guarantor Regulations provide
for initiating simultaneous insolvency proceedings against HAPL and Professor for the same
debt owing to the fact that not doing so would be inconsistent with the object of the Code.
Moreover, there is no such provision under IBC barring simultaneous initiation of proceeding
against personal guarantor and corporate debtor.
[ISSUE II]: THE APPROVAL OF THE RESOLUTION PLAN BY THE NCLT DOES
NOT PROHIBITS THE INITIATION OF PROCEEDINGS AGAINST PROFESSOR IN
CP(IB)-22(ND)/2020.
The approval of the Resolution Plan by the NCLT on 30.05.2020 does not prohibits the
initiation of proceedings against Professor in CP(IB)-22(ND)/2020 it would rather militate
against the Professor, and the Professor being bound by the Resolution Plan has no locus to
challenge the proceedings under Part III of the IBC.
[ISSUE III]: THE OBLIGATIONS OF PROFESSOR UNDER THE DEED OF

APPLICABLE LAW.
The RBS has rightly invoked the deed of guarantee dated 15.08.2018 owing to the fact the
liability of guarantor is co-extensive with that of principal debtor and the liability of guarantor
does not dispense off if debtor is discharged as result of due process of law, henceforth
obligation of Professor does not stands discharged under applicable law.
[ISSUE IV] THE NOTIFICATION DATED 15.11.2019 AND THE SECTIONS

NOTIFIED THEREIN UNDER, THE GUARANTOR RULES AND THE
GUARANTOR REGULATIONS ARE ALL NOT ULTRA VIRES THE IBC AND THE
CONSTITUTION OF INDIA.
The notification dated 15.11.2019 and the sections notified therein under, via the guarantor
rules and guarantor regulations issued by Ministry of Corporate Affairs are well within
boundary of Constitution of India and is in consonance with the object of the IBC owing to the
XII
fact that classification herein made is based on intelligible differentia and is in nexus with the
object of the Code.
[ISSUE V]: THE HON’BLE HIGH COURT DOES NOT HVE JURISDICTION TO
ENTERTAIN THE W.P. (C) 3911/2020.
The Writ Petition ought to be dismissed at the outset on account that IBC is the complete code
in itself and does eludes the role of High Court in the adjudicatory matters and any such
intervention would render the object of the Code. Moreover, an alternate efficacious remedy
available to Professor under Section 61 of the IBC.
XIII
ARGUMENTS ADVANCED
[ISSUE I]: THE NOTIFICATION DATED 15.11.2019 EMPOWERS RBS TO HAVE

LOCUS TO INITIATE PARALLEL PROCEEDINGS AGAINST HAPL AND THE
PROFESSOR FOR THE SAME DEBT.
The RBS is a financial creditor1 under Section 5 (7) of the code as he had agreed to sanction
business loan to the tune of Rs. 6,00,00,00,000/- to HAPL 2 and due to default in the payment
of debt by HAPL which was owed to RBS, it had initiated CIRP under Sections 6 and 7 of
chapter II of the code against HAPL which is a corporate debtor. Later, the notification dated
15.11.19, which brought in effect part III of the code in relation to personal guarantor to the
corporate debtor, gives locus to RBS to initiate parallel insolvency proceeding under Section
95 read with rule 7 (1) of the ‘Insolvency and Bankruptcy (Application to Adjudicating
Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors)
Rules, 2019 against the professor who is a personal guarantor to HAPL (corporate debtor),
under Section 3 (e) of the rules of the notification.
[I.A]: SUSPENSION OF PARALLEL PROCEEDING WOULD BE ANATHEMA TO THE SCHEME AND
OBJECT OF THE CODE.
The section 953 of part III the code empowers the creditor (RBS) through force of notification
dated 15.11.19, to initiate insolvency resolution process against the personal guarantor of the
corporate debtor who is professor in our case. Along with this, Section 60(2)4 of the Code
provides that “where a corporate insolvency resolution process or liquidation proceeding of a
corporate debtor is pending before a National Company Law Tribunal, an application relating
to the insolvency resolution or liquidation or bankruptcy of a corporate guarantor or personal
guarantor, as the case may be, of such corporate debtor shall be filed before the National
Company Law Tribunal.” Given this, there is legislative clarity that concurrent insolvency
proceedings can be maintained in respect of the corporate debtor and a guarantor.
Section 60(2) and (3) of the Code together require proceedings against a corporate debtor and
its guarantors to be simultaneously heard by the same Adjudicating Authority. The Committee
on insolvency and bankruptcy was of the view that the Code in fact, envisages initiation of
1
Moot Proposition, ¶ 9.
2
3
Insolvency and Bankruptcy Code 2016, s 95.
4
Insolvency and Bankruptcy Code 2016, s 60(2).
1
concurrent proceedings against both a corporate debtor and its sureties. Given this, the
Committee recommended that a creditor should not be prevented from proceeding against both
the corporate debtor and its sureties under the Code.5 In addition to statutory provisions and
committee’s recommendation, there have been judgments that are suggestive of the same idea
and further strengthen the same. In State Bank of India V. Ramkrishna, it was held that “The
object of the code is not to allow such guarantors to escape from an independent and co-
extensive liability to pay off the entire outstanding debt, which is why section 14 is not applied
to them”.6Same was established through amendment7 in the code in 2018. In Gouri Shankar
Jain v. Punjab National Bank8, the hon’ble court held that,“Notwithstanding the pendency of
Resolution Plan, a personal guarantor can be proceeded against under section 60 (2) read
with 95 and 97 (3) of the code.”And similar position was also maintained in Essar Steel India
Ltd. v. Satish Kumar Gupta9which suggested that insolvency of the personal guarantor can
occur simultaneously to that of corporate debtor.
In light of the above statutory provisions, amendments and judgments, it is manifestly clear
that parallel proceedings against the professor and the HAPL for the same debt is well within
the ambit of law thereby RBS has the locus to do the same and such action is maintainable
[I.B]: THERE IS NO EXCLUSIVE PROVISION IN THE CODE WHICH BARS INITIATING
PROCEEDING AGAINST THE GUARANTOR.
Code does not place a bar upon the creditor to proceed against a personal guarantor prior to
exhausting their remedies against the corporate debtor. On the contrary it provides for the
parallel proceeding before the same forum.10 Simultaneous proceeding will not only honour
the intent of the legislature but also safeguard the interest of stakeholder which is one of the
objects of the code. It is plausible that in the proceeding against the first corporate guarantor
the creditor is unable to realize the complete debt payable and the limitation to proceed against
the other debtor expires. In the meantime, such a practice that forces the creditor to wait around
before initial proceedings against the other debtor, shall give enough time to the corporate
debtor, personal and or corporate guarantor to alienate their asset and wriggle out of their
obligation towards the creditor.
5
Ministry of Corporate Affairs, Report of Insolvency Law Committee (2020) para 6.5.
6
State Bank of India v V Ramakrishnan (2018) 17 SCC 394.
7
The Insolvency and Bankruptcy Code (Amendment) Act 2017, s 10.
8
Gouri Shankar Jain v Punjab National Bank 2019 SCC OnLine Cal 7288.
9
10
Ministry of Corporate Affairs Notification New Delhi, 15th November 2019.
2
[I.C]: THE PRINCIPLE OF COEXTENSIVE LIABILITY OF GUARANTOR AND DEBTOR UNDER
CONTRACT ACT, CANNOT BE UNDERMINED.

Under Section 128 of the Indian Contract Act, 1872, the liability of a surety towards a creditor
is coextensive with that of the principal borrower.11 When a default is committed, the principal
borrower and the surety are jointly and severally liable to the creditor, and the creditor has the
right to recover its dues from either of them or from both of them simultaneously.
Notwithstanding the fact that they may stem from the same transaction, the two liabilities are
distinct12 but not in alternative and both are liable at the same time to the creditor13“The very
object of the guarantee is defeated if the creditor is asked to postpone his remedies
against the surety.” 14 The creditor is at liberty to proceed against either the debtor alone, or
the surety alone or jointly against both the debtor and the surety. Therefore, restricting a
creditor from initiating CIRP against both the principal borrower and the surety would
prejudice the right of the creditor provided under the contract of guarantee to proceed
simultaneously against both of them.
In State Bank Of India V. Rama Krishna case, it was also observed that, “enforcement of
guarantee may not have a significant impact on the debt of corporate debtor (asset of surety
are different from that of debtor) the corporate debtor and personal guarantor are separate
entities and that a corporate debtor undergoing insolvency proceedings under the Code would
not mean that a personal guarantor is also undergoing the same process. As the guarantor's
liability is distinct and separate from that of the corporate debtor, a suit can be maintained
against the surety.”15Also, in 2011 while shedding light on the principle of double dip the
Supreme Court of the UK, while shedding light on these principles in the matter of Kaupthing
Singer and Friedlander Limited noted that while procuring double dividend on substantially
the same debt against the same estate was barred (‘rule against double proof’), the same was
allowed against two separate estates (‘double dip’).
Therefore, it can be concluded that parallel proceedings against the corporate debtor and the
guarantor for the same debt, are maintainable as their assets are also different and such an
action is in consonance with the rule and regulation of the notification dated 15.11.19 and
therefore in the present case RBS does have the locus to initiate parallel proceedings against
HAPL and the professor.
11
The Indian Contract Act 1872, s 128.
12
Hukumchand Insurance Co Ltd v The Bank of Baroda & Others AIR 1977 Kant 204.
13
Jagannath Ganeshram Agarwala v Shivnarayan Bhagirath and Ors AIR 1940 Bom 247.
14
15
3
[ISSUE II]: THE APPROVAL OF THE RESOLUTION PLAN BY THE NCLT DOES
NOT PROHIBIT THE INITIATION OF PROCEEDINGS AGAINST PROFESSOR IN
CP(IB)-22(ND)/2020.
The respondent humbly submits before the Hon’ble Supreme Court of India that once the CIRP
is concluded and the resolution plan is approved by the adjudicating authority under section 31
of the IBC, the debt owed by the corporate debtor is settled. No proceedings can be initiated
against the corporate debtor in relation to the debt that is settled. However, proceedings can be
initiated against the guarantor for the recovery of remaining debt amount.
[II.A]: THE APPROVAL OF THE RESOLUTION PLAN BY THE NCLT ON 30.05.2020 MILITATES
AGAINST THE PROFESSOR.
It is submitted that once resolution plan is accepted by the member of COC it is then presented
before the Adjudicating Authority for its approval. The Adjudication Authority upon being
satisfied that the resolution plan is in conformity with the provisions of the Code approves it.
The resolution plan so approved is binding on the corporate debtor, creditors, stakeholders as
well as guarantors.16
In the present case also, when ARPL proposed a resolution plan it was accepted unanimously
by the members of COC and subsequently placed before NCLT for its approval. Thereafter,
the plan was approved by NCLT under section 31 of IBC. The said section contemplates that
the resolution plan approved by the Adjudicating Authority is binding on the guarantor.On the
basis of the said provision17, the Supreme Court in the case of SBI v. V. Ramakrishnan 18 held
that the guarantor cannot be relieved from making payment by virtue of Section 133 19 even if
the debt is varied under the resolution plan as the resolution plan is binding on the guarantor.
Further, the High Court of Calcutta in Gouri Shankar Jain v. Punjab National Bank20 faced
with the similar question, i.e., whether liability of the personal guarantor is extinguished upon
approval of the resolution plan. The Calcutta High Court observed that, “liability of the
personal guarantor is not extinguished upon approval of the resolution plan.”
Moreover, in the present case, the resolution plan, which is binding on Professor, specifically
provided that the right of RBS to enforce deed of guarantees “......22. RBS reserves its rights
16
17
ibid.
18
19
20
4
to proceed against the stakeholders of HAPL under independent contracts if any in terms of
applicable law...”21
[II.B]: APPROVAL OF RESOLUTION PLAN DOES NOT DISCHARGE GUARANTOR UNDER THE
INDIAN CONTRACT ACT, 1872.
Under the Indian Contract Act, 1872, there are various circumstances provided in which the
guarantor may be discharged of its liability towards the creditor. The two circumstances that
require sufficient consideration are as follows:
[II.B.1]: The Contract of Guarantee is an independent contract.
The liability of guarantor is co-extensive with that of principal debtor. 22 Therefore, upon the
default of principal debtor, a right is accrued in favour of creditor against both the principal
debtor and the guarantor. This liability is independent in itself as the contract of guarantee is
an independent contract.23 The guarantor becomes liable towards the entire debt amount for
which the guarantee is provided and can be proceeded against irrespective of whether any
proceedings have been initiated or are pending against the principal debtor.24 The
expression “co-extensive with that of the Principal Debtor” establishes the maximum extent
of the Surety’s liability. The surety is not only liable for the principal amount but also for the
interest and charges incurred in enforcing the liability.25The right of the creditor to proceed
against the guarantor is one which is independent of its right to proceed against the principal
debtor.26 Therefore, the proceedings against the principal debtor cannot act as a bar to
proceedings against the guarantor. The creditor can always recover the due amount from the
guarantor which it was not able to recover from the principal debtor. In fact, the Supreme Court
has also recognized this right of creditor in State Bank of India v. V. Ramakrishnan27 by
observing that the object of the IBC is not to allow the guarantor to escape its liability to pay
the debt.
[II.B.2]: An act of creditor, the legal consequence of which is discharge of the principal
debtor.
A guarantor is discharged of its liability towards the creditor if the creditor on its own instance
discharges the principal debtor.28 The essential element that needs to be satisfied is that the
21
22
23
BMD (P) Ltd v SVL Ltd [2018] 98 taxmann.com 61.
24
Bal Krishna v Atma Ram AIR 1948 Nag 277.
25
Indian Overseas Bank v G Ramulu (1999) 2 ALD 104.
26
Bank of India v Gupta Infrastructure (India) Ltd 2018 SCC OnLine NCLT 5865.
27
28
5
discharge of the debtor should be through a voluntary act of the creditor. If the discharge of
debtor is not through a voluntary act of the creditor but due to operation of law, then the
guarantor is not discharged and can be held liable.29 Any scheme or plan that is approved by a
court or tribunal becomes a statutory scheme and is an act in operation of law. 30
Under the IBC, the debtor is discharged on approval and implementation of resolution plan. It
is submitted that once resolution plan is accepted by the member of COC it is then presented
before the Adjudicating Authority for its approval. The Adjudication Authority upon being
satisfied that the resolution plan is in conformity with the provisions of the Code approves
it.31 Therefore, the principal debtor is discharged under the IBC not on the instance of a creditor
but due to the operation of law, i.e., approval of the NCLT after its satisfaction. The creditor
may or may not be favour of the resolution plan. However, once the same is approved by the
NCLT, the debtor is discharged and the said decision is binding on the creditor. Thus, the
guarantor is not discharged of its liability towards the creditor on the discharge of principal
debtor’s liability under the IBC.
In the present case, the said provision of the Contract Act does not apply as firstly, there has
not been any contract between the RBS being the creditor and the HAPL being the principal-
debtor whereby the principal debtor was released. Secondly, according to second part of section
134 of the Contract Act, a surety is discharged by any act or omission of the creditor, the legal
consequence of which is the discharge of the principal debtor. The question, which arises for
consideration, is whether an application filed by RBS under section 7 of the IBC could amount
to a “voluntary act” on part of the creditor. The Calcutta High Court observed 32 that a financial
creditor filing an application under section 7 of the IBC is exercising its statutory right and
not contractual right. Therefore, the exercise of such statutory right, which is involuntary in
nature, will not alter the contractual obligations of the parties. Consequently, it can be
concluded that in the instant case Professor is not discharged upon discharge of HAPL by way
of an insolvency proceeding.
[II.B.3]: Any variance in terms of the debt.
If the contract between the principal debtor and the creditor is varied without guarantor’s
consent, the guarantor is relieved from its liability to pay off the debt. 33 One such variance can
29
Maharashtra State Electricity Board v Official Liquidator AIR 1982 SC 1497; Jagannath Ganeshram Agarwala
v Shivnarayan Bhagirath and Ors AIR 1940 Bom 247.
30
In re Garner’s Motor Ltd (1937) 1 Ch 594.
31
32
33
6
be a change made to the debt owed by the principal debtor. If such a change is made without
the consent of guarantor, the guarantor is relieved from making any payment. Such a situation
may arise in the context of IBC proceedings wherein a reduced return for the debt may be
granted by the resolution plan. This issue has been dealt with by the Supreme Court in V.
Ramakrishna34. The Court, while addressing this issue, placed strong reliance on section 31 of
the IBC which states that once the resolution plan is approved it will be binding on all
stakeholders including the guarantors. On the basis of the said provision, it held that the
guarantor cannot be relieved from making payment by virtue of section 133 of the Contract
Act even if the debt is varied under the resolution plan as the resolution plan is binding on the
guarantor as well.35
Therefore, it is concluded that approval of resolution plan under section 31(1) of the Code by
NCLT did not prohibit RBS to initiate insolvency proceeding against Professor under section
95 of IBC.
[ISSUE III]: THAT THE OBLIGATIONS OF PROFESSOR UNDER THE DEED OF
APPLICABLE LAW.
It is humbly submitted before the Hon’ble Supreme Court of India that the obligations of
Professor under deed of guarantee dated `15.05.2018 does not stand discharged under
Applicable Law on the ground that liability of guarantor is co-extensive with that of principal
debtor and the liability of guarantor does not dispense off if debtor is discharged as result of
due process of law.
[III.A]: LIABILITY OF GUARANTOR IS CO-EXTENSIVE WITH THAT OF PRINCIPAL DEBTOR.
A contract of guarantee is a tripartite agreement which contemplates the principal debtor, the
creditor and the surety.36The idea of a guarantee is to have a second pocket to pay if the first is
empty. The fundamental principle about the surety's liability, as laid down in Section 128 37 is
that the liability of the surety is co-extensive with that of the principal debtor. The expression
“co-extensive with that of the principal debtor” shows the maximum extent of the surety's
liability. He is said to be accountable for the whole of the amount for which the principal debtor
is liable.38 The borrower along with the surety is jointly and severally liable. 39
34
35
36
Mahabir Shum Sher v Lloyds Bank AIR 1968 Cal 371.
37
38
Indian Overseas Bank v G Ramulu (1999) 2 ALD 104.
39
Syndicate Bank v K Manohara AIR 2003 Ker 284.
7
In the RBI's circular dated September 9, 2014 issued with reference to the Master Circular on
Wilful Defaulters DBOD.No.CID.BC.3/20.16.003/2014-15 dated July 1, 2014, clarified that
when a payment default is made by the principal debtor, the bank is entitled to proceed against
the guarantor/surety even without exhausting the remedies against the principal debtor. In the
renowned case of Bank of Bihar v. Damodar Prasad &Anr.40, it was held that the creditor can
proceed against Surety even before proceeding against the Principal Debtor and hypothecated
property. In addition to that it was stated in the case of Industrial Investment Bank of India Ltd.
v. Biswanath Jhunjhunwala41 that very object of guarantee would be defeated if creditor is
asked to postpone the remedy against the surety. The same was upheld by the Allahabad High
Court in U.P. Financial Corporation Vs. Garlon Polyfeb Industries and Others.42
The surety does not have a right to dictate terms to the creditor as to how he should make the
recovery and pursue his remedies against the principal debtor at his instance. 43In the present
case, the RBS is a banking company. A guarantee is a collateral security usually taken by a
banker. The security will become useless if his rights against the surety can be so easily cut
down.
Moreover, it is not even viable to say that guarantor, herein Professor should only be charged
for the balance amount as it was rightly held in the case of Naba Kishore Sahoo v United Bank
of India44 that the guarantor cannot say that the decree should first be executed against the
borrower and against him only for the balance. Unless there is a specific agreement between
the surety and the creditor to the effect that the principal debtor alone would be liable in the
first instance, the creditor can proceed against the surety to the same extent as if he were himself
the principal debtor. It would not be necessary first to realise the amount from the principal
debtor.45 In case of Kailash Chand Jain v U.P. Financial Corpn46, it was held that guarantors,
who were directors in this case, were not permitted to say that creditor must first try release the
value of unit of the borrower company which it had taken over, rather creditor in all power can
proceed against guarantors.
40
Bank of Bihar Ltd v Damodar Prasad AIR 1969 SC 297.
41
42
UP Financial Corporation v Garlon Polyfeb Industries and Others AIR 2001 All 286.
43
Ram Kishun v State of Uttar Pradesh (2012) 11 SCC 511.
44
Naba Kishore Sahoo v United Bank of India 1995 AIHC 2176.
45
Medisetti Ravi Babu v Pramida Chit Fund (P) Ltd (2003) 2 BC 527.
46
Kailash Chand Jain v UP Financial Corporation AIR 2002 All 302.
8
In nutshell, the liability of guarantor is well established and co-extensive with that of the debtor,
pursuant to which RBS rightly sued guarantor under the applicable law for the said amount and
Professor is under due obligation to pay the same.
[III.B]: LIABILITY OF GUARANTOR DOES NOT DISPENSE OFF IF THE PRINCIPAL DEBTOR IS
DISCHARGED AS RESULT OF DUE PROCESS OF LAW.
The combined analysis of different provision of law would prove that the liability of Guarantor
does not dispense off if the principal debtor is discharged as a result of due process of law.
[III.B.1]: No effect of Section 134 of ICA.

It is humbly submitted that in Halsbury’s Laws of England, under the chapter dealing with
Bankruptcy and Insolvency47, it has been mentioned that an order of discharge pursuant to a
company being declared as insolvent or bankrupt does not release any person who was surety
or in nature of surety. In re Jacobs48,where it was held by James L. J. that a discharge of a
debtor under a liquidation or a composition is really a discharge in bankruptcy by operation of
law, and will not discharge the surety from his liability.
Further, inMaharashtra State Electricity Board v.Official Liquidator, High Court 49 it was held
by the Hon’ble Supreme Court that “The liability of guarantor is absolute and unconditional.
The fact that the Company in liquidation i.e. the principal debtor has gone into liquidation also
would not have any effect on the liability of the Bank i.e. the guarantor. Under sec. 128 of the
Indian Contract Act, the liability of the surety is co-extensive with that of the principal debtor
unless it is otherwise provided by the contract. A surety is no doubt discharged under sec. 134
of the Indian Contract Act by any contract between the creditor and the principal debtor by
which the principal debtor is released or by any act or omission of the creditor, the legal
consequence of which is the discharge of the principal debtor. But a discharge which the
principal debtor may secure by operation of law in bankruptcy (or in liquidation proceedings
in the case of a company) does not absolve the surety of his liability.” Similar observation has
been followed in Thakur Das v. Phagwa50 wherein it was stated that the legislative intent of
such insolvency and bankruptcy law was to avoid any contradiction with general principal of
contract.This intent of legislation is very well established by insertion of Sec. 238 51 of IBC,
which states that IBC shall have overriding effect on other laws. The guaranteeing directions
47
Halsbury’s Laws of England (4th edn, 1989) vol 3, para 880.
48
In re Jacobs 98 NY 98 (1885).
49
Maharashtra State Electricity Board v Official Liquidator AIR 1982 SC 1497.
50
Thakur Das v Phagwa AIR 1936 Peshwar 150.
51
9
of the company can be proceeded against even when the company has entered into protection
from liability under the Sick Industrial Companies (Special Provision) Act, 1985. 52
Thus, this implies that surety is not discharged when the principal debtor is discharged from
the liability for paying debt on the account of being adjudged as insolvent or an order of
discharge being passed, discharging principal debtor.53
[III.B.2]: No Defence exists pursuant to Section 135 of ICA.
The Supreme Court in the matter of Industrial Finance Corporation of India Ltd v. Canonnore
Blending and Weaving Mills Ltd. and Ors.54held that,“in the event the principal debtor is
discharged of his liability by the creditor with the consent of the surety/guarantor, the creditor's
right of action against the surety stays preserved.” In the present case as per resolution plan
RBS reserves its rights to proceed against the stakeholders of HAPL under independent
contracts if any in terms of applicable law55.Thus, is concluded that RBS has its right to enforce
deed of guarantee against Professor.
[III.B.3]: No Defence pursuant to Section 139 of ICA.
It is submitted that if there is no impairment of surety’s remedy by act or omission of principal
debtor, thus no subsequent discharge of surety. Rowlatt in his book "Law of Principal and
Surety" observed: “A guarantee is not put an end to by reason of the debt becoming
unenforceable against the principal by reason of insolvency or bankruptcy or limitation, unless
it is due to a voluntary act or omission of the creditor contrary to his duty to the surety.” 56Thus,
there is not the voluntary act or omission on part of RBS in the existing circumstances rather
it’s by operation of law.57
As in the present case, since there was no explicit arrangement in resolution plan wherein it is
mentioned right of subrogation is curtailed58, due reference must be given to verdict of Hon’ble
Supreme Court in case of Committee Of Creditors Of Essar vs Satish Kumar Gupta59wherein
it is stated right of subrogation can be curtailed only when explicitly mentioned in resolution
plan and that is not the scenario in the present arrangement.
52
RK Dewan v State of UP (2005) All LJ 2067.
53
BN Nanjappa v Sangli Bank Ltd 1998 SCC OnLine Kar 617.
54
Industrial Finance Corporation of India Ltd v Canonnore Blending and Weaving Mills Ltd and Ors AIR 2002
SC 1814.
55
56
Rowlatt, The Law of Principal and Surety (3rd edn, 1936) 277.
57
R Thiagarajan v South Indian Bank Ltd ILR 1987 1 Ker 370.
58
59
10
[III.B.4]: No Defence exist by reason of Change of Management of Company.

The guarantors of a company's loans could not escape liability by reason only of the fact that
the company's management had totally changed. 60 As in the case of State of Gujarat v State
Bank of Saurashtra61 it was held that Guarantor allowed to be sued despite takeover of the unit
of the borrower. Thus, any reliance upon discharge of surety on ground of change of
management of the company as in the present case ARPL took over the management of the
Company62, that lead to novation of company or original agreement was will not sustain.
[ISSUE IV]: THE NOTIFICATION BRINGING IN EFFECT PART III OF THE CODE
ONLY IN RELATION TO PERSONAL GUARANTOR TO CORPORATE DEBTOR IS
VALID AND CONSTITUTIONAL.
It is humbly submitted before the Hon’ble Supreme Court that Central Government has rightly
exercised its power of rule-making63 under Sec.64 1(3) of the code to bring in effect different
provision of the code on different date. The Code through the notification makes several
improvements over the existing legislation on individual insolvency and adopts a more benign
approach. Part III of the Code makes provisions for insolvency resolution and bankruptcy of
individuals and partnership firms. To enable implementation of individual insolvency in a
phased manner considering the wider impact of these provisions, it classifies individuals into
three categories, namely, (i) personal guarantors (PGs) to corporate debtors (CDs), (ii)
partnership firms and proprietorship firms, and (iii) other individuals.
The Working Group on Individual Insolvency (WG) holds the view that a phased
implementation of individual insolvency and bankruptcy is the intention of legislature and a
practical necessity and suggested that the provisions of the Code may first be notified for
personal guarantors to CDs. The remaining provisions of Part III of the Code applicable to
other classes may be notified in subsequent phases.
[IV.A]: CONSIDERATIONS TO BE MADE WHILE DELIBERATING UPON CONSTITUTIONALITY OF
LEGISLATION.
Due consideration must be made while deliberating upon the constitutionality of any
legislation.
60
Punjab National Bank v Lakshmi Industrial & Trading Co (P) Ltd AIR 2001 All 28.
61
State of Gujarat v State Bank of Saurashtra (2004) 1 GLR 213.
62
63
In re Delhi laws Act, 1912 1951 AIR 332.
64
11
[IV.A.1]: There exists Presumption of Constitutionality in favour of Legislation

It is submitted that in order to declare a legislation unconstitutional, it should be proved that
the legislation is manifestly arbitrary and the burden shall be on the party challenging the said
legislation.65Further,in B.R. Enterprises v State of U.P.66 the Supreme Court observed, “First
attempt should be made by the courts to uphold the charged provisions and not to invalidate it
merely because one of the possible interpretations leads to such a result, howsoever attractive
it may be. Thus, where there are two possible interpretations, one invalidating the law and the
other upholding, the latter should be adopted. For this, the courts have been endeavoring,
sometimes to give restrictive or expansive meaning keeping in view the nature of the
legislation.” This presumption extends to laws imposing reasonable restriction of Fundamental
Rights.67
[IV.A.2]: Judiciary should exercise restraint while examining the Constitutional Validity
of Economic Legislation.
In Bhavesh D. Parish v. Union of India 68 held that in matters of economic policy the accepted
principle is that the courts should not interfere, this Court, while not jettisoning its jurisdiction
to curb arbitrary action or unconstitutional legislation, should interfere only in those few cases
where the view reflected in the legislation is not possible to be taken at all. Further, the Court
in R.K. Garg v. Union of India, 69held that since economic matters are essentially empiric and
it is based on experimentation therefore it cannot provide for all possible situations or anticipate
all possible abuses and on that account alone it cannot be struck down as invalid. The Supreme
Court followed the same reasoning in Swiss Ribbons Pvt. Ltd. v. Union of India while dealing
with IBC.70 The Supreme Court of US also suggested that the Court must defer to legislative
judgment in matters relating to social and economic policies and must not interfere, unless the
exercise of legislative judgment appears to be palpably arbitrary. 71
[IV.B]: THE NOTIFICATION SATISFIES THE TEST OF CLASSIFICATION
It is most respectfully submitted that power of delegation is a constituent element of the
legislative power.72 The Government of India has rightly exercised its power of rule-making
65
Charanjit Lal v Union of India AIR 1951 SC 41.
66
BR Enterprises v State of UP (1999) 9 SCC 700.
67
PUCL v Union of India (2004) 2 SCC 476.
68
Bhavesh D Parish v Union of India (2000) 5 SCC 471.
69
RK Garg v Union of India (1981) 4 SCC 675.
70
Swiss Ribbons (P) Ltd v Union of India (2019) 4 SCC 17.
71
Munn v Illinois 1876 SCC OnLine US SC 4.
72
Vasanlal Maganbhai Sanjanwala and the Pratap Spinning and Manufacturing Co Ltd v State of Bombay AIR
1961 SC 4; M/s Tata Iron and Steel Co Ltd v Workmen of M/s Tata Iron and Steel Co Ltd AIR 1972 SC 1917.
12
by enforcing the provision in phased manner rather than in toto as the classification is
reasonable and constitutional73 herein is based on intelligible differentia and is in consonance
with object of the Code.
[IV.B.1]: The Classification is based on Intelligible Differentia.
For a legislation to be reasonable, it must pass the twin test of reasonableness- It should not be
arbitrary and must be based on an intelligible differentia. The classification must have a
reasonable nexus with the object sought to be achieved 74. The Corporate Debtor often has
guarantors. For comprehensive corporate insolvency resolution and liquidation, it is necessary
that insolvency of the Corporate Debtor as well as its guarantors are considered together to the
extent possible. Sec. 12875 of the Indian Contract Act, 1872 enables a creditor to pursue remedy
against both the principal borrower and the guarantor, as liability of a guarantor is co-extensive
with that of the principal borrower. Thus, in case of default by principal debtor, the creditor
may choose to pursue remedy against the guarantor for repayment of debt. In effect, insolvency
proceedings of a Corporate Debtor and its guarantors are closely linked to each other.
In Ferro Alloys Corporation Ltd. Vs. Rural Electrification Corporation Ltd, the court upheld
that without initiating any CIRP against the principal borrower, it is always open to the
financial creditor to initiate CIRP under Section 776 against the corporate guarantors, as the
creditor is also the financial creditor qua corporate guarantor.77 Guarantors could be individuals
(personal guarantors) or corporates (corporate guarantors to CDs). The mechanism for
insolvency resolution of corporate guarantor, being CDs, is already in place. Resolution of
insolvency of personal guarantors complements corporate insolvency regime, particularly
when there is high incidence of applications being filed in respect of preferential, fraudulent,
undervalued and extortionate transactions. Absence of a regime for resolution of insolvency of
personal guarantors distorts the choice of borrowers and lenders. Thus, the impugned
notification puts personal guarantors and corporate guarantors at the same level playing field.
In the case of Committee of Creditors of Essar Steel India Limited through Authorised
Signatory v. Satish Kumar Gupta78, the apex court held that the claims of creditors against the
personal guarantors of the corporate debtor would not extinguish even after the resolution plan
for the corporate debtor was approved. Thus, the IRP rules and the Bankruptcy rules will allow
73
Basant Kumar Sarkar v Eagle Rolling Mills AIR 1984 SC 1260.
74
Laxmi Khandsari v State of Uttar Pradesh (1981) 2 SCC 600.
75
76
77
Ferro Alloys Corporation Ltd v Rural Electrification Corporation Ltd CP (IB) No 251/KB/2917.
78
13
the creditors of the corporate debtor to continue with the recovery proceedings against the
personal guarantors even after the completion of the corporate insolvency resolution process
(CIRP) of the corporate debtor. It has been held that classification among persons is permissible
if it is reasonable79. It was an urgent need to bring in effect part III of the code in respect of
personal guarantor of the corporate debtor, to fill in all the lacunae created through judgments,
to aid the corporate insolvency resolution process against the corporate debtor efficiently under
chapter II which was already in effect and to balance the interest of all stakeholders. Also,
working group has suggested that it is necessary to have separate rules and regulations for each
of the three classes of individuals and rules for the other classes will be brought at later stage
following a phased manner. Hence, there is an intelligible differentia in classifying personal
guarantor to the corporate debtor from other classes mentioned in part III of the code.
[IV.B.2]: The Classification made has Nexus with Object of the code.
In order to satisfy the test of classification the policy underlying the statute must be
ascertained.80 The classification done is in sync with the object of the code and promotes the
same. Resolution of both corporate and individual insolvency have certain common objectives,
such as increasing the supply of credit by increasing lenders’ expected returns and discourage
creditors from racing to be first to collect when debtor is in financial distress.
The insolvency proceeding against the personal guarantors is a huge relief to the creditors as it
will make easy for them to realize their debts. Till now the creditors used to claim their rights
in the Debt Recovery Tribunals (DRTs) which could not provide them with quick relief. Now,
the Insolvency proceedings under the regime of the Code will allow the creditors to realize
their debts in less time. The Supreme Court in Biswambhar Singh v. State of Orissa81 held
while rejecting a challenge based out of Article 1482 of the Indian Constitution, had held such
a provision cannot be considered discriminatory as long as the legislative discretion is exercised
within the contours of the object of the statute. Therefore, it is concluded that the classification
done under the notification is based on intelligible differentia and has nexus with the object of
the code therefore the notification does not violate Article 14 of the constitution.
79
TMA Pai Foundation v State of Kerala AIR 2003 SC 355.
80
Kangshari Haldar v State of West Bengal AIR 1960 SC 457.
81
Biswambhar Singh v State of Orissa AIR 1954 SC 139.
82
The Constitution of India 1950, art14.
14
[IV.C]: MEANINGFUL READING OF THE IBC, GUARANTOR RULES AND GUARANTEE

REGULATIONS SHALL ESTABLISH THAT PART III HAS BEEN SPECIFICALLY MADE APPLICABLE
TO GUARANTORS.
It is most respectfully submitted that Part III of the Code is applicable to debtors who are
individuals or partnership firms. It is, however, important to note that personal guarantors are
individuals. And to enable both debtor and creditor to participate with the least possible delay
and expense it is necessary that personal guarantor be governed under the provision of part III
of the code which deals with the insolvency proceeding of the individuals. The insolvency
resolution process under the Code provides certain minimum protection to them. Resolution of
individual insolvency has few other additional objectives, such as, provision of partial
consumption insurance for debtors, fresh start which incentivizes the debtors to work after
filing for bankruptcy. Thus, while operationalizing insolvency resolution of personal
guarantors, it is necessary to ensure that the individual has the minimum protection available
under the law. The recent amendment (2018) to Section 2(e) of the Code inserts the words
‘personal guarantor to corporate debtor’ despite the definition of personal guarantor under
Section 5(22)83 of the code because the later was applicable only to chapter II of the code but
addition of ‘personal guarantor to corporate debtor’ to other classes in Section 2(e), is
suggestive of the idea that insolvency proceeding of personal guarantor to corporate debtor
should be governed by part III of the code as other classes in Sec 2 (e). Accordingly, a personal
guarantor should only be considered a ‘debtor’ for the purposes of Part III of the Code, when
the liability of such personal guarantor has arisen in law. It can be clearly inferred that personal
guarantor of the corporate debtor should be governed through individual insolvency proceeding
under part III of the code, was the intention of the legislator. Therefore, meaningful reading of
Rule 7 along with Rule 3(e) of the Impugned Rules purport to permit a demand notice and
application under Section 95 to be issued against a guarantor, which is defined under Rule 3(e)
as a debtor who is a personal guarantor to a corporate debtor. Thus, combined evaluation of
impugned rules proves that that Part III has been specifically made applicable to Guarantors.
[IV.D]: PART III DOES NOT AFFECT THE CIRP PROCESS OF HAPL.
The intention of the legislature by adding ‘personal guarantor to corporate debtor’ to section
2(e)84 of the code through 2018 amendment was simple that insolvency proceeding of this
recently added category, should be governed under the provisions of part III of the code.
83
84
The Insolvency and Bankruptcy Code (Amendment) Act 2017, s 2 (e).
15
‘Debtor’ mentioned in section 101 (2) (c) and S. 96 (b) (ii), refers to “guarantor” in section 3
(e)85 of the impugned rules. It is important to mention here that the combined reading of section
96 and section 101 of part III of the code, gives an idea that this part deals only with the
insolvency proceeding of the classes mentioned in section 2 (e), therefore the debt in S. 96
86
means a liability due from the guarantor (here professor) to RBS as per section 3(11). The
corporate debtor and personal guarantor are separate entities and the guarantor's liability is
distinct and separate from that of the corporate debtor. 87 We also know that insolvency
procedures are different in part II and III of the code and the impugned notification only brings
the insolvency proceedings against the corporate debtor and the personal guarantor under the
same forum not through the same procedure. The purpose of impugned rules and regulation is
to aid the insolvency proceeding against the corporate debtor so that it can be completed in
time bound manner and considering the object of the code where time is of essence, any
provision which hinders or stays the CIRP proceeding of corporate debtor, will only result in
the more time consumption which cannot be the intention of the legislature. Therefore,
applicability of moratorium under section 96 and 101 is only in respect of the assets of the
surety and not that of the corporate debtor. Hence insolvency proceeding against the professor
won’t affect the CIRP proceeding against the corporate debtor.
[ISSUE V]: THE HON’BLE DELHI HIGH COURT HAS NO THE JURISDICTION TO
ENTERTAIN THE W.P. (C) 3911/2020.
It is humbly submitted before the hon’ble Supreme Court that the Delhi High Court does not
have writ jurisdiction in the present matter on the basis of grounds mentioned below:
[V.A]: IBC IS A COMPLETE CODE AND ELUDES THE ROLE OF HC IN THE ADJUDICATORY
MECHANISM.
It is beyond any doubt that IBC, 2016 is a complete Code in itself. It is an exhaustive code on
the subject matter of insolvency in relation to corporate entities and others.88 The code provides
a three-tier mechanism namely (i) the NCLT, which is the Adjudicating Authority (ii) the
NCLAT which is the appellate authority (S. 61) and (iii) the Supreme Court (S. 62) as the final
authority, for dealing with all issues that may arise in relation to the reorganization and
insolvency resolution of corporate persons.
85
The Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for
Personal Guarantors to Corporate Debtors) Rules 2019, r 3(e).
86
ibid.
87
88
Innoventive Industries Ltd v ICICI Bank (2018) 1 SCC 407.
16
The exclusion of HC from the adjudicatory framework of the IBC is manifestly clear from the
bare provisions like sections 60 (5) (c), 63 and 231of the code. The provisions of the IBC
enumerating powers of the NCLT oust the powers of other forums from exercising jurisdiction
over such functions. Section 23189 was interpreted by the Delhi HC in the case of Liberty House
Group Pte Ltd v. State Bank of India and Others90whereby the court categorically refrained
from exercising jurisdiction with respect to the action taken by the NCLT in pursuance of the
powers conferred upon it by the IBC itself. Also, the NCLT, Kolkata, in the case of Aryan
Mining and Trading Corporation Private Limited v. Ganesh Sponge Private Limited,91 stated
that any injunction granted by any court, shall be nullity in law and cannot be given effect to,
by virtue of Section 231 of the IBC. Therefore, the legislature was of the firm view that the any
issue arising out of the IBC can only be looked into by NCLT, NCLAT and the SC and ousts
the jurisdiction of HCs in toto.
[V.B]: INTERVENTION BY THE HIGH COURT WOULD RENDER THE OBJECT OF THE CODE
MEANINGLESS.
In cases concerning bankruptcy and insolvency, time is of essence. This is so because the
recoverable money from a depreciating asset systematically declines due to depreciation over
time. The average time for disposal of cases in high courts is much higher, 92 than what is
required for an efficient insolvency regime. The writ will obviously be dealt in ordinary course
of business at the high courts. This will be very much counterproductive for the regime.
Adjudication of matters pertaining to the IBC by the HC will impinge upon the time bound
nature of the proceedings under it.
It also appears that intervention by High Courts in exercise of the power of judicial review over
administrative action might open a floodgate of litigation before high courts around the country
and thus, render the legal remedy of appeal before the NCLAT/DRAT redundant, which would
ultimately impact the time-bound insolvency resolution under IBC.
[V.C]: THE HIGH COURT CANNOT ASSUME JURISDICTION UNDER ARTICLE 226 IN THE
PRESENT MATTER.
Unless a specific constitutional remedy is sought, the high court cannot assume jurisdiction
under article 226. Wherever any the legislature provides for statutory adjudication of rights and
89
90
Liberty House Group Pte Ltd v State Bank of India and Others 2019 SCC OnLine Del 7256.
91
Aryan Mining and Trading Corporation Private Limited v Ganesh Sponge Private Limited 2017 SCC OnLine
NCLT 7514.
92
Pradip Thakur, ‘High Court Judges Get Just 5-6 Minutes to Decide Cases, says Study’ The Times of India (7
April 2016).
17
dispensation of claims through specific enactments, the courts cannot invoke writ jurisdiction
as that shall be tantamount to defeating the legislative intent and shall impede the parliament’s
legislative competence.93 Therefore, the high court’s being bound by article 141 are obliged to
dismiss all cases seeking relief under article 226/227 in direct contravention to an available
statutory remedy.
[V.D]: THE IBC PROVIDES FOR THE ALTERNATE AND EQUALLY EFFICACIOUS REMEDIES.
A general rule is that the statutory remedy should be exhausted before approaching the writ
court.94 The Insolvency Bankruptcy Code is an exhaustive code that supersedes all other
statutes by virtue of the non-obstante the Code.95 Relying on case of Minerva Mills where it
was held, “it would be within the competence of Parliament to amend the Constitution so as to
substitute in place of the High Court, another alternative institutional mechanism or
arrangement for judicial review, provided it is no less efficacious than the High Court.” 96The
court in Sampath Kumar v. Union of India97, held that “the tribunal should be a real substitute
of the high court not only in form and de jure, but in content and de facto.”
NCLT is the only court of first instance in respect of the area of insolvency
The NCLT is a specialized Tribunal constituted for the purpose of speedier and effective
regulation of the affairs of the companies and has the exclusive jurisdiction to deal with the
affairs of the company.98 NCLT is empowered by the parent statute to adjudicate upon the all
the matter relating to insolvency under section 60 (5) (c) of the code.
The SC in Essar Case99 held that “Section 60(5) (c) of the IBC is in the nature of a residuary
jurisdiction vested in the NCLT so that the NCLT may decide all questions of law or fact arising
out of or in relation to insolvency resolution or liquidation under the Code.”Further, in the case
of L Chanrakumar v. Union of India, it has been made clear that the tribunals are competent to
hear matters where the vires of statutory provisions are questioned and consequently, also have
the power to test the vires of subordinate legislations and rules. It will not be open for litigants
to directly approach the High Court even in cases where they question the vires of statutory
legislations by overlooking the jurisdiction of the Tribunal concerned. To hold that the
Tribunals have no power to handle matters involving constitutional issues would not serve the
93
Commissioner of Income Tax v Chhabil Das Agarwal (2014) 1 SCC 603.
94
Law Commission of India, 272th Report on Assessment of Statutory Framework of Tribunals in India (2007).
95
Innoventive Industries Ltd v ICICI Bank (2018) 1 SCC 407.
96
Minerva Mills v Union of India (1986) 4 SCC 222.
97
Sampath Kumar v Union of India (1985) 4 SCC 458.
98
SAS Hospitality Pvt Ltd v Surya Construction Pvt Ltd 2018 SCC OnLine Del 11909.
99
18
purpose for which they were constituted.100 Also, in a case Bombay High Court had dismissed
the writ petition on ground of availability of alternate and equally efficacious remedies under
Section 61 of IBC to prefer an appeal before NCLAT and, a further remedy under Section 62
of IBC to prefer an appeal before the Supreme Court from NCLAT. 101
The court must have a good and sufficient reason to bypass the alternative remedy provided by
the statute.102 Existence of an alternative remedy would be a good ground for not entertaining
the petition.103 Where an alternative remedy is available to the person, the court may not
exercise the power under Article 227104 where remedy by way of appeal and revision was
available, a High Court cannot assume jurisdiction.105In several cases, both in England and
India, the ancient rule stated by Willes, J., in Wolverhampton New Waterworks
Co. v. Hawkesford106 to the effect that where a liability not existing at Common Law is created
by a statute, which also gives a special and particular remedy for enforcing it, the remedy
provided by the statute must be followed, has been quoted with approval. For instance, Union
Bank of India v. SatyawatiTandon107 held that the availability of a remedy of appeal under the
DRT Act, 1993 and SARFAESI Act, 2002 should deter the High Court from exercising the
jurisdiction under Article 226. Similarly, the availability of remedy of appeal under Section
173 of the Motor Vehicles Act, 1988 as against an award of the Accidents Claims Tribunal was
held as sufficient for the High Court to refuse to exercise its supervisory jurisdiction.108
The NCLT was intended to function as an independent body with the full jurisdiction to
adjudicate all matters arising out of and incidental to the CIRP. 109 This plenary right of the
High Court to issue a prerogative writ will not normally be exercised by the Court to the
exclusion of other available remedies unless such action of the State or its instrumentality is
arbitrary and unreasonable so as to violate the constitutional mandate of Article 14. 110 And this
has already been proved above that the impugned notification does not violate article 14 of the
constitution.
100
L Chandra Kumar v Union of India (1997) 3 SCC 261.
101
Anthony Raphael Kallarakka v NCLT 2018 SCC OnLine Bom 13865.
102
CCE v Dunlop India Ltd AIR 1985 SC 330.
103
State of Bihar and Ors v Jain plastic and chemicals Ltd (2002) 1 SCC 216.
104
Ram Roop v Bishwa Nath AIR 1958 All 456.
105
Swetambar Sthanakwasi Jain Samiti v Alleged Committee of Management Sri RJI College (1996) 3 SCC 11.
106
Wolverhampton New Waterworks Co v Hawkesford (1859) 6 CBNS.
107
Union Bank of India v Satyawati Tandon (2010) 8 SCC 110.
108
Sadhana Lodh v National Insurance Co (2003) 3 SCC 524.
109
110
ABL International Ltd v Export Credit Guarantee Corporation of India Ltd (2004) 3 SCC 553.
19
The Supreme Court in Harbanslal Sahnia v. Indian Oil Corporation111held that the rule of
exclusion due to statutory jurisdiction, though is a rule of discretion, should be sparingly used
only when special circumstances like violation of principles of natural justice exist. In an
instance the SC had even asked the high court to refrain from entertaining debate on
constitutional validity of the code. 112
Moreover, Calcutta HC observed that by the virtue of Section 424 of the Companies Act 2013,
NCLT and NCLAT are required to follow the principles of natural justice. Therefore, the
parties can challenge the order before the NCLAT if the principles of natural justice have not
been followed by the NCLT. In a recent case113 the SC held if the concerned NCLT has erred
by coram non judice i.e., by exercising a jurisdiction not vested in it in law, then only the HC
can interfere with the proceedings under Article 226 of the Constitution of India ignoring the
availability of a statutory remedy of appeal to the NCLAT. And there are instances where the
desired objective was achieved within the statutory appeal mechanism without an unwarranted
interference by the high court.114 If the ability to decide matters incidental to the CIRP is
stripped away from the NCLT, the tribunal shall become a mere paper tiger without the means
to resolve complicated insolvency cases. Even if the NCLT’s order is illegal for want of
jurisdiction, the NCLAT is the appropriate body to issue a stay of operation instead of the high
court.
111
Harbanslal Sahnia v Indian Oil Corporation AIR 2003 SC 2120.
112
Shivam Water Treaters Pvt Limited v Union of India 2017 SCC OnLine SC 1920.
113
M/s Embassy Property DevelopmentsPvt Ltd v State of Karnataka &Ors 2019 SCC OnLine SC 154.
114
Edelweiss Asset Reconstruction Company v Vijay Kumar V Iyer RP of Murli Industries Ltd (2019) SCC OnLine
NCLAT 374.
20
PRAYER
In light of the questions presented, arguments advanced and authorities cited, the Respondent
most humbly and respectfully prays before this Hon’ble Court, that it may please to adjudge
and declare that –
1. The RBS does have locus to initiate parallel proceeding against HAPL and Professor
by way of CP (IB)-11(ND)/2019 and CP(IB)-22(ND)/2020.
2. The approval of the Resolution Plan by the NCLT does not prohibits the initiation of
proceedings against Professor in CP(IB)-22(ND)/2020.
3. The obligation of Professor under the Deed of Guarantee dated 15.08.2018 does not
stand discharged under applicable law.
4. The notification dated 15.11.19 and sections notified therein under the guarantor
rules and the guarantor regulations are all constitutional and valid.
5. The Hon’ble Delhi High Court does not have jurisdiction to entertain the W.P (C)
3911/2020.
AND/OR
Pass any other order which the bench deems fit in the best interest of Justice, Equity and Good
Conscience, and for this act of kindness the Counsels on behalf of the Respondent as in duty
bound shall forever pray.
Respectfully Submitted
-Counsel for Respondent
XIV

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UNIVERSITY MOOT COURT SELECTIONS, GRAND INTRA, 2020

MEMORIAL ON BEHALF OF THE RESPONDET

UNIVERSITY MOOT COURT COMPETITION, GRAND INTRA, 2020

IN THE HON’BLE SUPREME COURT OF INDIA

UNDER THE SPECIAL LEAVE PETITION

ENSHRINED UNDER ARTICLE 136 OF THE CONSTITUTION OF INDIA

SPECIAL LEAVE PETITION (CIVIL) ****/2020

IN THE MATTER OF:

ROYAL BANK OF SPRAIN AND OTHERS………..…..………………RESPONDENTS

ON SUBMISSION TO THE SUPREME COURT OF INDIA

MEMORIAL FOR THE RESPONDENTS

LIST OF ABBREVIATIONS .................................................................................................. III

STATEMENT OF JURISDICTION..................................................................................... VIII

STATEMENT OF FACTS ......................................................................................................IX

ISSUES RAISED .....................................................................................................................XI

SUMMARY OF ARGUMENTS ........................................................................................... XII

ARGUMENTS ADVANCED ................................................................................................... 1

[ISSUE I]: THE NOTIFICATION DATED 15.11.2019 EMPOWERS RBS TO HAVE

[ISSUE III]: THAT THE OBLIGATIONS OF PROFESSOR UNDER THE DEED OF

[III.A]: Liability of Guarantor is Co-Extensive with that of Principal Debtor. ................. 7

[IV.A]: Considerations to be made while deliberating upon Constitutionality of

[IV.B]: The Notification satisfies the Test of Classification ........................................... 12

AIR All India Reporters

SCC Supreme Court Cases

SCR Supreme Court Reports

ICA Indian Contract Act

NCLT National Company Law Tribunal

NCLAT National Company Law Appellate Tribunal

ARPL Arturo Rex Pvt. Ltd.

HAPL Heist Artillery Private Limited

RBS Royal Bank of Sprain

CoC Committee of Creditors

IBC Insolvency and Bankruptcy Code

CIRP Corporate Insolvency Resolution Process

State Bank of India v V Ramakrishnan (2018) 17 SCC 394. ............................................passim

Insolvency and Bankruptcy Code 2016, s 1(3). ....................................................................... 11

The Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency

The Constitution of India 1950, art14. ..................................................................................... 14

Law Commission of India, 272th Report on Assessment of Statutory Framework of Tribunals

ARTICLE 136: SPECIAL LEAVE TO APPEAL BY THE SUPREME COURT

PROFESSOR BY WAY OF CP (IB)-11(ND)/2019 AND CP(IB)-22(ND)/2020?

WHETHER THE OBLIGATIONS OF PROFESSOR UNDER THE DEED OF GUARANTEE DATED

15.08.2018 STAND DISCHARGED UNDER APPLICABLE LAW?

[ISSUE I]: RBS DOES HAVE THE LOCUS TO INITIATE PARALLEL

[ISSUE III]: THE OBLIGATIONS OF PROFESSOR UNDER THE DEED OF

[ISSUE IV] THE NOTIFICATION DATED 15.11.2019 AND THE SECTIONS

[ISSUE I]: THE NOTIFICATION DATED 15.11.2019 EMPOWERS RBS TO HAVE

PROCEEDING AGAINST THE GUARANTOR.

[I.C]: THE PRINCIPLE OF COEXTENSIVE LIABILITY OF GUARANTOR AND DEBTOR UNDER

CONTRACT ACT, CANNOT BE UNDERMINED.

[III.B.1]: No effect of Section 134 of ICA.

[III.B.4]: No Defence exist by reason of Change of Management of Company.

[IV.A.1]: There exists Presumption of Constitutionality in favour of Legislation

[IV.C]: MEANINGFUL READING OF THE IBC, GUARANTOR RULES AND GUARANTEE

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