Personal Guarantor's Liability Can't Exceed Contractual Limit: NCLT Kochi Dismisses Petitions U/S 95 IBC For Defective Demand Notices

The NCLT (Kochi Bench) has dismissed petitions under Section 95 of the IBC (Insolvency and Bankruptcy Code) for "defective demand notices," stating "personal guarantor's liability can't exceed contractual limit." Section 95 is for initiating insolvency against personal guarantors. The NCLT's decision emphasizes two key points: first, demand notices must be precise and legally sound; second, a personal guarantor's liability is strictly limited to the terms of their guarantee. Any notice claiming an amount exceeding the contractual limit is defective, leading to dismissal and protecting guarantors from excessive claims.