# In the matter of Shyam Sunder Bhatter & Ors. Vs. Punjab National Bank & Anr. CA(AT)(Insolvency) 728 & 729-2018

> NCLAT judgment dated 2018-12-03. Citation: TCN-2018-NCLAT-00030. Two appeals were filed by guarantors, Shyam Sunder Bhatter (guarantor of M/s. Dynamic Shells…

- **Court:** NCLAT
- **Order date:** 3 Dec 2018
- **Citation:** TCN-2018-NCLAT-00030
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclat-new-delhi/shyam-sunder-bhatter-ors-vs-punjab-national-bank-anr-ca-6e81a387

## Summary

### Background

Two appeals were filed by guarantors, Shyam Sunder Bhatter (guarantor of M/s. Dynamic Shells (India) Pvt. Ltd., the Corporate Debtor) and M/s. Rockside Impex Pvt. Ltd., against a common order dated September 27, 2018. The order was passed by the Adjudicating Authority (National Company Law Tribunal) Principal Bench, New Delhi, admitting an application under Section 7 of the Insolvency and Bankruptcy Code (I&B Code) filed by Punjab National Bank against the Corporate Debtor. The appeals were filed with a delay of 15 days, along with a petition for condonation of delay.

## Facts

Punjab National Bank (Financial Creditor) initiated corporate insolvency resolution process against M/s. Dynamic Shells (India) Pvt. Ltd. (Corporate Debtor). The Adjudicating Authority admitted the application under Section 7 of the I&B Code. Two appeals were filed against this order: one by Shyam Sunder Bhatter, a guarantor of the Corporate Debtor, and another by M/s. Rockside Impex Pvt. Ltd. The appeals were filed with a delay of 15 days. The sole ground for the appeals was that the guarantors were not impleaded as party respondents in the insolvency proceedings. The court considered whether the guarantors were necessary parties at the time of admission of the application under Section 7.

## Issues and analysis

### Issue 1: Whether a guarantor is a necessary party at the time of admission of an application under Section 7 …

**Ratio:** A guarantor is not a necessary party at the time of admission of an application under

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**Reasoning:** The court reasoned that the guarantor's presence is not essential for the admission of an

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**Interpretation:** This interprets Section 7 of the I&B Code to mean that the presence of a

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**Application:** Since the guarantor was not a necessary party, the court dismissed the appeal,

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## Parties

- **Judges:** S.J. Mukhop…; Bansi Lal…
- **Appellants:** Shyam Sunder…
- **Respondents:** M/s Dynamic…; Punjab National…

## Timeline

- **2018-09-27 — Order by Adjudicating…**: The Adjudicating Authority (National Company Law Tribunal) Principal Bench, New Delhi,…
- **2018-12-03 — Order of…**: The NCLAT condoned the delay of 15 days but…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 7 — Initiation of corporate insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-7)

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