[Cites 3, Cited by 0]
Calcutta High Court
Avishek Roy And Ors vs Indian Bank And Ors on 30 January, 2026
Author: Debangsu Basak
Bench: Debangsu Basak
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OCD-5
IN THE HIGH COURT AT CALCUTTA
COMMERCIAL APPELLATE DIVISION
ORIGINAL SIDE
APOT/330/2025
WITH CS-COM/125/2025
IA No.GA-COM/1/2026
AVISHEK ROY AND ORS.
-VERSUS-
INDIAN BANK AND ORS.
Present :
The Hon'ble Justice Debangsu Basak
-And-
The Hon'ble Justice Md. Shabbar Rashidi
For the Appellant : Mr. Rudraman Bhattacharyya, Sr. Adv.
Mr. Akash Munshi, Adv.
Mr. Satyaki Mukherjee, Adv.
Mr. Harsh Tiwari, Adv.
Mr. Souvik Kundu, Adv.
For the Respondent No.1 : Ms. Debline Lahiri, Adv.
Mr. Mrinmoy Chatterjee, Adv.
For the Respondent No.2 : Mr. Sailendra Kr. Tiwari, Adv.
Mr. Shambhu Mahato, Adv.
Ms. Muskan Jalan, Adv.
HEARD ON : 30.01.2026
DELIVERED ON : 30.01.2026
DEBANGSU BASAK, J.:-
1. Appeal is at the behest of the plaintiff and directed against the order
dated December 8, 2025 passed in IA No.GA-COM/1/2026 filed in CS-
COM/125/2025.
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2. By the impugned order, learned single Judge refused to grant interim
protection to the plaintiff.
3. Learned senior advocate appearing for the appellants submits that, the
appellants were the directors of a corporate-debtor. Such corporate
debtor enjoyed certain credit facilities from banks, being the respondent
nos.1 and 2 herein. Learned senior advocate appearing for the
appellants submits that, the corporate debtor was enjoying various
contracts with different third parties. The respondent nos.1 and 2
engineered revocation of such contracts by the third parties causing loss
to the corporate debtor. In respect of some of such contracts, a suit was
filed by the corporate debtor being MS 35 of 2019 pending before the
learned Civil Judge, Senior Division, Port Blair.
4. Learned senior advocate appearing for the appellant submits that, a
proceedings under Insolvency & Bankruptcy Code 2016 was initiated as
against the corporate debtor before the National Company Law Tribunal
(NCLT). The corporate debtor ultimately suffered an order of winding up.
The respondent no.3 is the liquidator of such corporate debtor. He refers
to a minutes of the meeting held by the respondent no. 3 amongst the
Stakeholders Consultation Committee. He submits that, in such
Stakeholders Consultation Committee a decision was taken which
tantamounts to dereliction of duty of the respondent no.3. He refers to
Section 35(1)(k) of the Insolvency & Bankruptcy Code 2016 in this
regard.
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5. Learned senior advocate appearing for the appellant submits that, the
creditors persuaded the respondent no. 3 to withdraw the suit filed by
the corporate debtor. He refers to the order by which the suit was
withdrawn. He submits that, if the suit was allowed to be continued with,
then, there was every possibility of the corporate debtor receiving its
claim made in such suit. The respondents impaired the rights of the
appellants as guarantors by withdrawing MS 35 of 2019.
6. Relying upon 1968 SCC Online J&K 4 (Sardar Kahn Singh Vs. Tek
Chand Nanda & Anr.) and 1980 (4) SCC 516 (State Bank of
Saurashtra Vs. Chitranjan Ranganath Raja & Anr.) learned senior
advocate appearing for the appellant submits that, the respondents
acting in bad faith with regard to the securities and the claim of the
corporate debtor against the third party, impaired the right of the
guarantors to step into the shoes of the corporate debtor. By virtue of
Section 139 of the Indian Contract Act, 1872, the appellants stood
discharged from their liabilities to the respondent nos. 1 and 2.
7. Respondent Nos. 1 and 2 are represented. None appears for the
respondent no. 3.
8. Appellants claim themselves to be the directors of a corporate debtor who
suffered an order of winding up after the attempt at corporate insolvency
resolution failed. Respondent no. 3 was appointed as the liquidator of
such corporate debtor. A Stakeholders Consultation Committee was
formed. A meeting of such Stakeholders Consultation Committee was
held where the appellants and the respondents were present. In such
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meeting, it was decided that, the respondent no. 3 will withdraw MS No.
35 of 2019 pending before the learned Civil Judge, Senior Division, Port
Blair.
9. Consequent upon such resolution of the Stakeholders Consultation
Committee, respondent no. 3 proceeded to and obtained withdrawal of
such suit. The learned Civil Judge, Senior Division, Port Blair allowed the
withdrawal of the suit by the order dated December 2, 2025.
10. Issue as to whether or not such action of the respondent no. 3 as the
liquidator of the company in liquidation sounds in breach of Section
35(1)(k) of the Code of 2016 or not need not be entered into by a suit
Court or by us on appeal, as the same if raised may be considered by the
NCLT where the liquidation proceedings are pending. We make no
comments with regard thereto.
11. So far as, the discharge of liability is concerned, two authorities are cited
before us. Both authorities are on a final hearing of the concerned suit.
Facts and circumstances of those two authorities are completely different
to those pending before us. In neither of those authorities namely
Sardar Kahn Singh as well as Chitranjan Ranganath Raja &
Anr.(supra) the interplay of the Indian Contract Act, 1872 and the Code
of 2016 were considered, as it was not required.
12. In the facts and circumstances of the present case, the corporate debtor
in question is in liquidation under the provisions of the Code of 2016.
The appellants before us are the guarantors of the company in
liquidation. The liquidation proceedings are under the Code of 2016. The
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liability of a guarantor in respect of a debt of the corporate debtor does
not stand reduced or extinguished upon an insolvency resolution plan
being approved in respect of a corporate debtor under the Code of 2016.
Purely on the ground that the company is in liquidation under the Code
of 2016 a guarantor to the credit facilities of the company in liquidation
would stand substituted in place and stead of the company in liquidation
and consequently, the guarantor would be entitled to seek an order of
injunction as prayed for is debatable. It is equally debatable as to
whether any injunction qua guarantor stand breached by a liquidator
withdrawing a suit filed by a company in liquidation, in the requirement
to do so being approved in a Stakeholders Consultation Committee,
under the Code of 2016.
13. We find no ground for interference with regard to the discretion exercised
by the by the learned Single Judge in refusing to pass interim protection
in favour of the appellant.
14. APOT/330/2025 along with all connected applications are dismissed
without any order as to costs.
(DEBANGSU BASAK, J.)
15. I agree.
(MD. SHABBAR RASHIDI, J.)
A/s.
