# In the matter of Rajendra Prasad Tak (Liquidator) vs. Mahanadi Coalfield Ltd. and Anr.

> NCLAT judgment dated 2025-07-25. Citation: TCN-2025-NCLAT-00413. The Appellant, the Liquidator of KVK Nilachal Power Pvt. Ltd., challenged the NCLT's order…

- **Court:** NCLAT
- **Order date:** 25 Jul 2025
- **Citation:** TCN-2025-NCLAT-00413
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-chennai/rajendra-prasad-tak-liquidator-vs-mahanadi-coalfield-ltd-and-anr-5a7e0041

## Summary

### Background

The Appellant, the Liquidator of KVK Nilachal Power Pvt. Ltd., challenged the NCLT's order dismissing his application for the return of bank guarantees and margin money from the respondents. The corporate debtor was undergoing liquidation after a failed resolution process.

## Facts

The Corporate Insolvency Resolution Process (CIRP) was initiated against KVK Nilachal Power Private Limited on 17.09.2019.

Rajendra Prasad Tak was appointed as the Interim Resolution Professional (IRP) and later as the Liquidator.

The resolution process failed, leading to a liquidation order on 17.12.2020.

KVK Nilachal Power Private Limited had entered into a Fuel Supply Agreement with Mahanadi Coalfield Limited (Respondent No. 1) and provided bank guarantees as security.

Respondent No. 1 invoked the bank guarantees during the liquidation process.

The Liquidator filed IA No. 553 / 2023 seeking the return of margin money and bank guarantees, which was dismissed by the Adjudicating Authority.

…

## Issues and analysis

### Issue 1: Whether the Liquidator is entitled to the refund of margin money after the invocation of the Bank …

**Ratio:** The Liquidator is not entitled to the refund of margin money once the Bank Guarantee has

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**Reasoning:** The margin money is considered a contribution towards securing the Bank Guarantee and

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**Interpretation:** The tribunal interpreted that margin money, after the invocation of the bank

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**Application:** The principle from Punjab National Bank V. Supriyo Kumar Chaudhuri & Ors.

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## Parties

- **Judges:** Sharad Kumar…; Jatindranat…
- **Appellants:** Rajendra Prasad…
- **Respondents:** KVK Nilachal…; Mahanadi Coalfield…; +1 more
- **Advocates:** Abhishek…; Karan K…; +2 more

## Timeline

- **2019-09-17 — CIRP Init…**: Corporate Insolvency Resolution Process initiated against KVK Nilachal Power Private…
- **2020-12-17 — Liquidation…**: Liquidation order passed due to the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 3(31) — Definitions](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-3)

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