# In the matter of Central Bank of India Vs. Jai Kumar Goyal, C.P. (IB)/184(KB)2021

> NCLT judgment dated 2021-09-16. Citation: TCN-2021-NCLT-01112. The case involves an application filed under Section 95(1) of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 16 Sept 2021
- **Citation:** TCN-2021-NCLT-01112
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/central-bank-of-india-vs-jai-kumar-goyal-cp-dccf3e2f

## Summary

### Background

The case involves an application filed under Section 95(1) of the Insolvency and Bankruptcy Code, 2016 (IBC) read with Rule 7(2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtor) Rules, 2019, and Regulation 4(2) of the IBBI (Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Regulations, 2019, to initiate the Insolvency Resolution Process (IR Process) against Mr. Jai Kumar Goyal, a personal guarantor to M/s BRG Iron & Steel Co. Pvt. Ltd. The applicant, Central Bank of India, is a statutory body constituted under the Banking Companies (Acquisition and Transfer of Undertaking) Act, 1970, and a member of a consortium finance account termed as

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## Facts

Central Bank of India, a statutory body, granted loans and credit facilities to M/s BRG Iron & Steel Co. Pvt. Ltd. (BRG), with Mr. Jai Kumar Goyal acting as a personal guarantor. BRG was part of a consortium finance account with UCO Bank. The bank initially rendered financial assistance to Golden Management Pvt. Ltd., which later merged with BRG. A Master Restructure Agreement was executed on 21.07.2014, following a LOA dated 30.10.2014. Mr. Goyal, along with others, provided personal guarantees with joint and several liability. The restructured term loan was reviewed and renewed, but BRG defaulted on payments, leading to its account being declared a Non-Performing Asset on 23.08.2016. The bank initiated recovery actions under the Recovery of Debts Due to Banks and

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## Issues and analysis

### Issue 1: Whether the application under Section 95(1) of the Insolvency and Bankruptcy Code, 2016, for …

**Ratio:** Section 95(1) of the IBC, 2016, allows a creditor to file an application for initiating

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**Reasoning:** The court considered the application filed by Central Bank of India, the creditor,

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**Interpretation:** Section 95(1) provides a mechanism for creditors to pursue insolvency

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**Application:** The court applied Section 95(1) to the facts of the case, finding that the

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## Parties

- **Judges:** Rajasekha…; Harish Chander…
- **Appellants:** Central Bank of…
- **Respondents:** BRG Iron & Steel…; MR.JAI KUMA…

## Timeline

- **1970-01-01 — Banking Compa…**: Central Bank of India constituted under the Banking Companies (Acquisition and Transfer…
- **2012-07-10 — Request for Credit…**: BRG requested the applicant for…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 95(1) — Application by creditor to initiate insolvency…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-95)

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