Notice u/s13(2) SARFAESI Act Demanding Payment from Guarantor Constitutes Invocation of Personal...

The NCLAT has ruled that a notice under Section 13(2) of the SARFAESI Act, demanding payment from a guarantor, constitutes an invocation of the personal guarantee. The tribunal clarified that such a notice explicitly seeking payment from the guarantor triggers the guarantor's liability. This decision provides clarity on the legal process for invoking personal guarantees in loan defaults. It ensures that guarantors are aware of their obligations and that lenders follow due process in recovering debts. The ruling is significant for banking and finance, streamlining the enforcement of personal guarantees under the SARFAESI Act.