Guarantors liability

vikram singh (Querist) 06 December 2013 This query is : Resolved
company has obtained loan from a bank .The directors executed personal guarantee also.subsequently at the time of renewal of limits some of the directors were resigned and the bank renewed the documents with the new incoming directors and some old directors as well.The bank has not discharged the outgoing directors fromthe personel liability as they found some latches in the securities provided by them. The account became NPA the bank has issued 13(2) demand notice to all the old and new directors and taken possession of the properties.The out going directors filed Application before DRT stating that they have resigned from the company and were discharged from the liability hence not liable .

Now i want a clarification whether out going directors can substantiate their contention when bank had not discharged them.

please its urgent .SC judgments supporting bank will be appreciated.

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Devajyoti Barman (Expert) 06 December 2013
Well mere resignation from Company is no defence. They will have have to show that while resigning they surrendered then guarantee also.
In absence of that they are still liable.

Guest (Expert) 06 December 2013
It is up to the Bank to decide whether out going Directors could be exempted from the case.Normally the Answer is NO.In the cases like Income Tax Defaults and Bank Loans the Responsiblities and Liabilities of the Directors would continue even if they claim that they had resigned Apart from being guarantors being directors they are the borrower also

prabhakar singh (Expert) 06 December 2013
no more to add.

vikram singh (Querist) 07 December 2013
thanks for the replies. but they are taking the defence of novation of contract. pls guide with some HC /SC judgments

Raj Kumar Makkad (Expert) 09 December 2013
We do not provide the judgments on this site.

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