Limitation Period For Filing Application U/S 95 Of IBC Against Personal Guarantor Stands Extended By Acknowledgement Of Debt: NCLAT

The National Company Law Appellate Tribunal (NCLAT) has ruled that the limitation period for filing an application under Section 95 of IBC (Insolvency and Bankruptcy Code) against a personal guarantor stands extended by acknowledgment of debt by the corporate debtor. This significant decision provides relief to financial creditors, clarifying that the acknowledgment of debt by the company extends the limitation period for pursuing claims against its personal guarantors. Section 95 allows initiation of insolvency proceedings against personal guarantors. This ruling streamlines debt recovery for creditors, aligning the limitation period for both the corporate debtor and its guarantor.