Prerana ( Navsari )
24-Sep-2026 05:49 PM
Moratorium
Sir can you explain this " Explanation " part as it says surity cannot file case or cannot take any action. As in the recorded lecture you said that "sub- sec (1)should not apply "but text says sub sec(1) shall apply".
Hello Prerana, Answer to yopur doubt: No, a surety (guarantor) CANNOT initiate a proceeding against the Corporate Debtor (CD) during the moratorium period. Section 14(3)(b) states that the provisions of sub-section (1) (Moratorium) "shall NOT apply to a surety in a contract of guarantee for a Corporate Debtor." it means the moratorium shield does not protect the surety. Creditors can still sue or recover money directly from the guarantor/surety while the Corporate Debtor is under insolvency.
Answer given by Shubhamm Sir at 25-Sep-2026 02:13 PM