Reena Paul Vs CA Francis Mathew (NCLAT Chennai)
Summary: The National Company Law Appellate Tribunal (NCLAT), Chennai, decided five Company Appeals together, as they raised common questions of fact and law concerning personal guarantors of a corporate debtor, M/s. Unitek Power Solutions India Limited. The appeals involved personal guarantors who had stood as guarantors against financial assistance provided by JM Financial Asset Reconstruction Company Ltd. The creditor initiated proceedings under Section 95 of the Insolvency & Bankruptcy Code (I&B Code), 2016, leading to the personal insolvency process against the guarantors.
The NCLT had admitted the personal insolvency applications on 17.03.2022, and these orders were not challenged further by the appellants. Following this, a Resolution Professional (RP) was appointed under Section 97 of the I&B Code. The RP issued a public notice on 31.03.2022, inviting claims from stakeholders, with only the financial creditor filing a claim. The appellants collectively submitted a repayment plan of ₹21 crores under Section 105 of the I&B Code on 07.11.2022, which was considered by the RP and recorded by the NCLT on 16.11.2022.
The Committee of Creditors (CoC) met multiple times—21.11.2022, 02.12.2022, and 18.01.2023—to evaluate the repayment plans. The CoC ultimately rejected the repayment plan with 100% voting because the offered amount was below expectations and the guarantors failed to submit a revised plan despite being granted extensions and reminders.
