After Sureties, Promotors who have given personal guarantee for the loans are to face heat Now-

After Sureties, Promotors who have given personal guarantee for the loans are to face heat Now-

Insolvency & Bankruptcy board may employ personal assets of guarantors to be enchased and employed for repayment of corporate loans.

MAJOR RECOMMENDATION OF IBBI WORKING PANEL

1	Introduction of a cadre of “Debt Counsellors”
2	Include provision of mediation in case of small cases
3	To make the district courts as adjudicating authority in place of debt recovery panel to ensure easy access.
4	To Educate People against the stigma associated with insolvency
5	Creditors may be restrained from attaching the living accommodation and jewellery of promotors with religious significance.

The Present Status of Recovery Mode

1	353 Companies in India are presently undergoing resolution process as of 30th September 2017
2	12 Companies have already gone into liquidation

The Insolvency and Bankruptcy Board (IBBI) is seriously thinking to allow creditors of the company to encash the personal guarantee given by the promotors of the Company in the process of their debt realisation.

It is to be noted that personal guarantors who have escaped action in the NCLT process will no longer be immune to recovery action by creditors.

A working committee of Insolvency Professionals had submitted recommendations on such changes to IBBI a month ago. The committee is of the view that it will facilitate a quicker aggregation of assets of defaulters and guarantors.