S. 13(2) SARFAESI Act Notice Demanding Payment From Guarantor Constitutes Invocation Of Personal Guarantee: NCLAT Delhi

NCLAT Delhi holds SARFAESI notice to guarantor constitutes personal guarantee invocation under Section 132, validating creditor claims. The National Company Law Appellate Tribunal (NCLAT) in Delhi has ruled that a notice issued to a guarantor under the SARFAESI Act (Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act) amounts to the invocation of their personal guarantee as per Section 132 of the Insolvency and Bankruptcy Code (IBC). This decision provides clarity and strengthens the position of financial creditors, confirming that such a notice establishes the crystallization of debt against the guarantor, allowing creditors to proceed with recovery actions.