# In the matter of Central Bank of India Vs. Sandeep Goyal, C.P. (IB)/187(KB)2021

> NCLT judgment dated 2021-09-16. Citation: TCN-2021-NCLT-01109. 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-01109
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/central-bank-of-india-vs-sandeep-goyal-cp-745f1ac9

## 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 IB Rules, 2019 and Regulation 4(2) of the IB Regulations, 2019, for initiating the Insolvency Resolution Process against Mr. Sandeep Goyel, a personal guarantor to M/s BRG Iron & Steel Co. Pvt. Ltd. ("BRG"). The applicant, Central Bank of India, is a member of a consortium that had extended credit facilities to BRG. BRG defaulted on its payments, leading to its account being declared a Non-Performing Asset (NPA). The bank initiated recovery proceedings against the guarantors, including Mr. Goyel.

## Facts

Central Bank of India, a member of a consortium, extended credit facilities to BRG Iron & Steel Co. Pvt. Ltd. (BRG). Mr. Sandeep Goyel acted as a personal guarantor for the loans provided to BRG. BRG defaulted on its payment obligations, leading to its account being classified as a Non-Performing Asset (NPA) on 23.08.2016. Central Bank of India initiated recovery proceedings against the guarantors under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993. BRG was also subjected to corporate insolvency resolution process (CIRP) under Section 7 of the IBC, 2016, which was admitted on 03/02/2020. As no resolution plan was approved, BRG was put into liquidation. Central Bank of India filed an application under Section 95(1) of the IBC, 2016, seeking

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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 Insolvency and Bankruptcy Code, 2016 allows a creditor to apply for

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**Reasoning:** The court considered the application and the fact that the corporate debtor, BRG Iron

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**Interpretation:** Section 95(1) provides a mechanism for creditors to recover their dues from

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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…; SANDEEP…
- **Advocates:** Pankaj Ag…; Suryanee…

## Timeline

- **2012-07-10 — BRG requests for fund…**: BRG requested the applicant vide a letter dated 10.07.2012 for granting Non- Fund based…
- **2014-07-21 — Master Restructure…**: The Respondent stood as personal guarantor entered to a Master Restructure Agreement…

## 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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