NCLT dismisses Yes Bank’s claim against Vijay Group Realty, Real Estate News, ET Real Estate

National Company Law Tribunal ,NCLT) is rejected yes bankClaim of over ₹420 crore against real estate developer Vijay Group RealtyCiting an uninvoked bank guarantee and the original borrower account being a standard account.

The bank had moved the dedicated bankruptcy court against the decision of the company’s insolvency resolution professional to reject its claim and not include the bank in the Committee of Creditors (CoC). yes bank, had said in December 2021 in response to a query from the resolution professional that the developer had not defaulted in repayment of its loan and the bank had not invoked the corporate guarantee provided by the corporate guarantor. However, Yes Bank insisted on accepting its claims from the resolution professional.

Advocate Shyam Kapadia, representing the bank, had submitted that the maturity of the claim, or the default in the claim or the invocation of the guarantee to claim the amount, has no nexus with the filing of the claim.

To counter this, Advocate Nausher Kohli, representing the resolution professional of the company, relied upon another judgment of the NCLAT, in which the Court took a contrary view, holding that uninvoked corporate guarantees as per the provisions of the IBC cannot be claimed. cannot be considered as such. Therefore, it should not be included in the claims list maintained and updated by the resolution professional.

The Mumbai bench of NCLT comprising Judicial Member HV Subba Rao and Technical Member Anuradha Sanjay Bhatia dismissed the bank’s plea after hearing the arguments of both the parties and considering the matter.

The Bench is of the view that the resolution professional has not committed any illegality or irregularity in rejecting the bank’s claim on the basis of an uncalled guarantee in respect of the standard account of the principal borrower and that his decision is in accordance with the laid down law. From Supreme court,
Ashish Pyasi, associate partner, Dheer & Dheer Associates, said guarantees given by companies to bankers pose a challenge when a company goes into insolvency proceedings.

“The bank has to invoke the first guarantee for any kind of claim and if the same is not done before the resolution process starts, the bank cannot invoke such guarantee after the moratorium kicks in,” said Pyasi. Huh.”

“It is settled law that such claims cannot be accepted. The resolution professional has to examine the claim from this point of view as well and such claim, if any, needs to be rejected as the professional has rejected outright.” In this case,” he said.