In Brief
A bank may initiate parallel insolvency proceedings against both a principal borrower and its corporate guarantor for the same debt, the Supreme Court held. The Court reasoned that under contract law, a guarantor's liability is co-extensive with the principal debtor's—meaning they are jointly liable. The IBC's scheme, including Section 60, contemplates such simultaneous proceedings. While both entities may be pursued, a creditor cannot recover more than the total debt owed; recovery must be tracked across proceedings. The Court rejected concerns about "double enrichment," finding existing regulations sufficient to prevent overrecovery. Guidelines for managing group insolvencies are better left to the legislature and regulatory authorities.
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