When can guarantors of a company qualify as personal guarantors under IBC? NCLT Jaipur Bench decides

The NCLT noted that a personal guarantor means an individual who is a surety to a corporate debtor in a contract of guarantee with that corporate debtor.

Through a common judgment delivered on Tuesday, the Jaipur Bench of the National Company Law Tribunal (NCLT) clarified the ambit of Non-Banking Finance Companies (NBFCs) as corporate debtors and the initiation of insolvency proceedings against personal guarantors of such financial service providers under the Insolvency and Bankruptcy Code (IBC) [Shapoorji Pallonji Finance Private Limited v. Rekha Singh].

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