State Bank of India Vs Mangalagiri Textile Mills Private Limited (NCLT Amaravati Bench)
Summary: The National Company Law Tribunal, Amaravati Bench, considered IA (IBC) (LIQ)/3/2026 filed by Mr. Immaneni Eswara Rao, Resolution Professional of Mangalagiri Textiles Mills Private Limited, under Sections 33, 34(1) and 60(5) of the Insolvency and Bankruptcy Code, 2016, seeking liquidation of the Corporate Debtor and appointment of the Applicant as Liquidator. The application was filed following the failure of the resolution process after the Resolution Applicant did not furnish the Performance Bank Guarantee required under the Request for Resolution Plan.
The Corporate Debtor had been admitted into Corporate Insolvency Resolution Process under Section 7 of the Code by order dated 25.07.2024. The Resolution Professional thereafter conducted the CIRP, constituted the Committee of Creditors with State Bank of India as its sole member, and undertook the process for inviting and evaluating resolution plans. Five prospective resolution applicants submitted expressions of interest. Following several extensions, negotiations and revisions, the resolution plan submitted by Dr. Goli Nagasaina Rao, the suspended director, was ultimately found to be the only compliant plan and was approved by the CoC through voting dated 09.12.2025.
Despite the approval, the Performance Bank Guarantee required under the RFRP was not submitted. The Resolution Applicant repeatedly sought extensions, but failed to furnish the PBG within the additional time granted. During the 25th CoC meeting and its adjourned meeting, the CoC recorded that the failure to submit the PBG rendered the Resolution Plan non-responsive. The CoC subsequently considered whether to restart the resolution process or proceed with liquidation and, through e-voting dated 30.01.2026, decided with 100% voting share to liquidate the Corporate Debtor and approved the appointment of the Applicant as Liquidator.
