The validity of demand notice service at the last known address under the Guarantee Deed is upheld, confirming that personal guarantors remain liable irrespective of concurrent CIRP proceedings against the corporate debtor.

ORDER

(Hybrid Mode)

[Per: Arun Baroka, Member (Technical)]

The present Appeal is filed challenging Orders dated 19^th September, 2024 passed by the ‘Adjudicating Authority’ (AA, [AA- Adjudicating Authority]) (National Company Law Tribunal, New Delhi Bench, Court-III) in CP (IB) No. IB-655(ND)/2022 and IA- 319/2024 by which initiation of Personal Insolvency Resolution Process(PIRP) it has been ordered against the Appellant. Similar PIRP, [PIRP-Personal Insolvency Resolution Process] has been ordered by the AA in CP (IB) No. IB-656(ND)/2022 and IA-521/2024 against which appeal CA (AT) (Ins.) 2054/2024 has been filed and for PIRP ordered by the AA in CP (IB) No. IB-652(ND)/2022 and IA-335/2024 appeal in CA (AT) (Ins.) 2117/2024 has been filed.

Brief facts relevant for the Appeal

2. Facts necessary to be noticed for deciding this appeal are:

Sanction Letter- issued in favour of Andes Town Sept. 10, 2014 Planners Pvt. Ltd (“Corporate Debtor”) and Rohtas Projects Ltd (“Co- Borrower”) for a project loan of Rs. 90 crores by Omkara Assets Reconstruction Private Limited “Financial Creditor” or “Respondent No.1” - earlier Dewan Housing Finance Corporation Ltd.-DHFL and subsequently Piramal Capital & Housing Finance Limited.

The Loan was secured by way of irrevocable personal guarantees.

Following documents exchanged between the Sept. 29, 2014 Corporate Debtor, the Co-borrower and the Financial Creditor:

a. Hypothecation Deed- charge created on all receivables from sale of units in Rohtas Plumeria & Summit.

b. Pledge Letter- for 99.99% shares of the Corporate Debtor

c. Loan Agreement – for Rs. 90 Crores

d. Escrow Agreement

e. Deed of Guarantee- executed by Mr. Paresh Rastogi and Mr. Piyush Rastogi both being directors of Corporate Debtor along with Mr. Pankaj Rastogi and Mr Deepak Rastogi in favour of Respondent No. 1- Omkara.

Date of Default- the Corporate Debtor along with May 2018 the Co-borrower committed default in repaying the loan.

Recall Notice- was issued by the Respondent No.1 Jan. 2, 2020 to all four guarantors wherein the Deed of Guarantee was invoked by the Respondent No. 1 and further called upon the guarantors to pay the outstanding amount of Rs. 108,19,72,155/- as on December 30, 2019, within 15 days.

Notice invoking Guarantee on the last known Feb. 15, 2021 address- by the Respondent No.1 for Rs. 133,14,26,737/- as on January 31, 2021.

Record of Default- submitted by the Respondent March 11, 2022 No. 1 to National E-Governance Services Limited (“NESL”).

Demand Notice- issued under Section 95 (4)(b), -Application by creditor to initiate insolvency resolution process. “…… (4) An application under sub-section (1) shall be accompanied with details and documents relating to- (a) the debts owed by the debtor to the creditor or creditors submitting the application for insolvency resolution process as on the date of application; (b) the failure by the debtor to pay the debt within a period of fourteen days of the service of the notice of demand; and..” of May 10, 2022 the Code by the Respondent No. 1 to all the guarantors via courier, on the last known address and email for Rs. 161,92,58,947/- as on May 9, 2022

Company Petition (IB) No. 655/ND/2022 July 18, 2022 (“Company Petition”), filed before the Adjudicating Authority under Section 95 of the Code.

Limited Notice of Company Petition- issued by Sept. 7, 2022 the Adjudicating Authority.

Affidavit of service- filed by the Respondent No. 1 Sept. 27, 2022 stating: Speed Post: Petition not delivered as “Addressee left without instructions”. E-mail: Petition delivered vide e-mail dated September 26, 2022.

Section 7 against the Corporate Debtor- admitted March 2, 2023 by