Neeta Saha Vs Assets Care & Reconstruction Enterprise Ltd. (NCLAT Delhi)
The National Company Law Appellate Tribunal, Delhi Bench, dismissed a set of appeals filed by personal guarantors challenging a common order dated 07.01.2025 that admitted applications under Section 95 of the Insolvency and Bankruptcy Code, 2016. The impugned order, passed by the Adjudicating Authority (NCLT, New Delhi Bench–II), initiated personal insolvency resolution proceedings against the appellants, who had furnished personal guarantees for loans availed by the corporate debtor.
The factual background showed that the corporate debtor had been granted a term loan of ₹90 crore by a financial institution, with disbursements made between November 2017 and October 2019. The appellants executed irrevocable and unconditional personal guarantees. Upon default by the principal borrower, default notices were issued in 2019. Subsequently, corporate insolvency resolution proceedings against the corporate debtor commenced on 28.02.2020. The debt was later assigned to the respondent financial creditor, which filed its claim in the corporate debtor’s CIRP. While a substantial portion of the claim was admitted, the remainder was disputed and became the subject matter of a pending interlocutory application.
The financial creditor invoked the personal guarantees in March 2022 and issued a demand notice in Form B in November 2022. As no payment was made, applications under Section 95 were filed in January 2023. An Interim Resolution Professional was appointed, and after objections from the personal guarantors and submission of a report under Section 99 recommending admission, the Adjudicating Authority admitted the applications. This order was challenged before the Appellate Tribunal.
