MAITREYA DOSHI versus ANAND RATHI GLOBAL FINANCE LTD. AND ANR.

Citation: [2022] 15 S.C.R. 536 · Decided: 22-09-2022 · Supreme Court of India · Bench: INDIRA BANERJEE · Disposal: Dismissed

Cited by 3 judgment(s) · cites 2 · see the full citation network in Lexace

Judgment (excerpt)

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SUPREME COURT REPORTS
[2022] 15 S.C.R.
[2022] 15 S.C.R. 536
536
MAITREYA DOSHI
v.
ANAND RATHI GLOBAL FINANCE LTD. AND ANR.
(Civil Appeal No. 6613 of 2021)
SEPTEMBER 22, 2022
[INDIRA BANERJEE AND J. K. MAHESHWARI, JJ.]
Insolvency and Bankruptcy Code 2016 – ss.7, 62 – Corporate
Insolvency Resolution Process – Respondent No. 1, a NBFC-
Financial Creditor disbursed loan to the tune of Rs.6 Crores to M/
s Premier Ltd. – Doshi Holdings pledged shares held by it in Premier,
in favour of the Financial Creditor, by way of security for the loan
– Premier failed to make repayments – Financial Creditor called
upon Premier and Doshi Holdings, to pay the entire outstanding loan
amount – Premier admitted and acknowledged its liability to pay its
outstanding dues, but stated that it could not pay the same on account
of genuine difficulty – Financial Creditor filed petition u/s.7 for
initiation of CIRP against Premier for default in repayment – On the
same day, the Financial Creditor also filed a petition against Doshi
Holdings u/s.7 in respect of the same claim, based on the same loan
documents – NCLT admitted the petitions – NCLAT dismissed the
appeal against the admission of petitions by NCLT – On appeal, held:
Loan-cum-Pledge Agreements were executed by both Premier and
Doshi Holdings and Doshi Holdings has been referred to in the
agreement as borrower and pledgor – The interpretation given by
NCLAT that Doshi Holdings is a borrower is definitely a plausible
interpretation which cannot be interfered with in an appeal under
s.62 of the IBC – A pledgor per se may not be a Financial Debtor but
NCLAT arrived at a factual finding that Disha Holdings was a
borrower – The approval of a resolution in respect of one borrower
cannot certainly discharge a co-borrower – If there are two borrowers
or if two corporate bodies fall within the ambit of corporate debtors,
there is no reason why proceedings under s.7 of the IBC cannot be
initiated against both the Corporate Debtors – The same amount
cannot be realised from both the Corporate Debtors – If the dues
are realised in part from one Corporate Debtor, the balance may be
realised from the other Corporate Debtor being the co-borrower –
Once the claim of the Financial Creditor is discharged, there can
be no question of recovery of the claim twice over.
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Dismissing the appeal, the Court
HELD: 1. Prima facie, it appears that Doshi Holdings was
a party to the Loan-cum-Pledge Agreement in its dual capacity of
borrower and pledgor of shares. The Appellate Authority has
arrived at the factual finding that Doshi Holdings is also a borrower
under the Loan-cum-Pledge Agreement. The factual finding of
the Appellate Authority which was the final fact finding authority
ought not to be interfered in this appeal. [Paras 32 and 33][545-
C-D]
2. The finding of the Appellate Authority that Doshi
Holdings is a borrower, is based on its interpretation of the Loan-
cum-Pledge Agreements and supporting documents. The
interpretation given by the Appellate Authority is definitely a
possible interpretation. The interpretation is a plausible
interpretation which cannot be interfered with in an appeal under
Section 62 of the IBC. It is true, that contract of indemnity,
contract of guarantee and pledge are not one and the same. The
contract of indemnity is a contract by which one party promises
to save the other from loss caused to him by the conduct of the
promisor himself or by the conduct of any other person. In a
contract of indemnity, a promisee acting within the scope of his
authority is entitled to recover from the promisor all damages
and all costs which he may incur. A contract of guarantee, on the
other hand, is a promise whereby the promisor promises to
discharge the liability of a third person in case of his default. The
person who gives the guarantee is called the surety. The person
in respect of whose default, the guarantee is given is the principal
debtor and the person to whom the guarantee is given is the
creditor. Anything done or any promise made for the benefit of
the principal debtor may be a sufficient consideration to the surety
for giving the guarantee. On the other hand, the bailment of goods
as security for payment of a debt or performance of a promise is
a pledge. [Paras 34 and 35][545-E-H]
3. The proposition of law which emerges from the judgment
is that a pledgor per se may not be a Financial Debtor. However,
in this case, the Appellate Authority arriv

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