In Brief
The Supreme Court upheld the validity of a November 2019 notification bringing into force specified provisions of the Insolvency and Bankruptcy Code, 2016, selectively in relation to personal guarantors of corporate debtors. Rejecting arguments that this constituted impermissible delegation of legislative power, the Court found sufficient statutory guidance in the 2018 amendment creating a distinct category for personal guarantors and the Code's internal structure (notably Sections 2(e), 60, and 179). The phased implementation reflected legitimate policy to unify insolvency proceedings of corporate debtors with those of their personal guarantors before a common forum (NCLT). The Court also clarified that approval of a corporate debtor's resolution plan does not discharge the personal guarantor's independent contractual liability, which remains co-extensive with the principal debt."
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