Top industrialists are now facing the music with personal guarantors being brought under the Insolvency and Bankruptcy Code in November 2019. Also, banks have been directed by the Finance Ministry to set up a monitoring mechanism to pursue personal insolvency proceedings against all those promoters who had furnished personal guarantees for borrowing by their companies and that later turned bad. Put simply, this has opened a can of worms.
Should the Finance Ministry not deserve a pat for bringing personal guarantees under the IBC?
Certainly, but most of the credit should go to the Supreme Court. The apex court, in July showed the mirror to the Finance Ministry and asked why banks are not invoking the new remedy in law. Some 1.8-lakh-cr…
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