Canara Bank Limited Vs Sanjana Uday Desai (NCLT Mumbai)
The National Company Law Tribunal (NCLT), Mumbai Bench, considered a petition filed by Canara Bank Limited under Section 95(1) of the Insolvency and Bankruptcy Code, 2016 (IBC), read with Rule 7(2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtor) Rules, 2019, seeking initiation of the Insolvency Resolution Process (IRP) against the personal guarantor of Frost International Limited for an alleged default of ₹671,56,76,843.68. The petition was filed on 08.11.2024.
The Financial Creditor stated that it had sanctioned various working capital facilities to the Corporate Debtor in 2014. These facilities were secured by, among other securities, personal guarantees executed by several guarantors, including the respondent. A deed of guarantee dated 12.05.2014 was executed. Subsequently, a notice under Section 13(2) of the SARFAESI Act was issued on 21.09.2019 to the Corporate Debtor and the personal guarantors. Thereafter, a demand notice dated 01.12.2023 was issued under the IBC and the applicable Rules. Since the outstanding amount was not paid within the prescribed period, the Financial Creditor filed the present petition.
The Tribunal had earlier appointed a Resolution Professional (RP) to submit a report under Section 99 of the IBC. The RP sought information from the Personal Guarantor regarding repayment of the debt. The Personal Guarantor contended that the petition was barred by limitation. After examining the application and the material placed before him, the RP recommended admission of the petition under Section 100 of the Code.
