Considering Being a Loan Guarantor? Understand This Supreme Court Ruling First, or Face Trouble

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Supreme Court: Guarantor Equally Liable for Loan, Faces Parallel Insolvency

सुप्रीम कोर्ट ने लोन गारंटर और मूल कर्जदार दोनों को समान माना है.

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News18•27-02-2026, 10:02

Supreme Court: Guarantor Equally Liable for Loan, Faces Parallel Insolvency

•Supreme Court rules guarantor is as much a participant as the principal debtor in loan repayment.
•Insolvency proceedings can be initiated simultaneously against both the principal debtor and its corporate guarantor.
•No statutory bar under IBC prevents financial creditors from initiating parallel proceedings to recover dues.
•Decision affirms the Indian Contract Act principle: guarantor's liability is co-extensive with the principal debtor.
•Rejects appeals to stay parallel proceedings, allowing recovery from guarantor companies.

Read Full Article on News18 in Hindi

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