ibc, 2016 S. 14(1) – Whether the bank guarantee in question can be invoked during the moratorium declared under Section 14(1) of IBC 2016? – With the aforesaid, we hold that the Corporate Debtor has issued bank guarantee for ensuring the price of goods. The bank guarantee is irrevocable and unconditional and payable on demand without demur. The assets of the surety are separate from those of the corporate debtor, and proceedings against the corporate debtor may not be seriously impacted by the actions against assets of third party like surety. Bank guarantee can be invoked even during moratorium period issued under section 14 of the IBC in view of the amended provision under section 14 (3)(b) of the IBC.
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Bharat Aluminium Co Ltd v. Jp Engineers Pvt Ltd & Ors