NCLAT upholds S. 95 Application against Personal Guarantor, Rejects Time-Bar Claim and Authorization Challenge

The NCLAT upheld the initiation of insolvency proceedings against a personal guarantor under Section 95 of the Insolvency and Bankruptcy Code (IBC), rejecting the claims of the guarantor that the application was time-barred. The personal guarantor argued that the application was beyond the prescribed limitation period and that there was a lack of proper authorization for initiating the proceedings. However, the NCLAT found that the application was validly filed and that the guarantor’s claims were not substantiated. It reaffirmed that personal guarantees are enforceable under the IBC, and the proceedings can be initiated despite claims of delay or improper authorization.