# 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-01113. 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-01113
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/central-bank-of-india-vs-sandeep-goyal-cp-f5b557d4

## 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. The applicant, Central Bank of India, is a member of a consortium that had extended credit facilities to BRG. BRG defaulted on its payments and was declared a Non-Performing Asset on 23.08.2016. An IBC application against BRG was admitted, and the company is undergoing liquidation. The applicant issued a demand notice to Mr. Goyel, but received no response.

## Facts

Central Bank of India, a member of a consortium, extended credit facilities to M/s BRG Iron & Steel Co. Pvt. Ltd. (BRG). Mr. Sandeep Goyel stood as a personal guarantor for the loan. BRG defaulted on its payments, leading to its account being declared a Non-Performing Asset on 23.08.2016. An IBC application against BRG was admitted, and the company is undergoing liquidation. Central Bank of India issued a demand notice to Mr. Goyel on 16/02/2019 under rule 7(1) of the IB Rules, 2019, but received no response. The applicant initiated action against the guarantors under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993, which is presently pending before the Ld. Debt Recovery Tribunal-I Kolkata being OA No. 31/2020. The applicant seeks initiation

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## Issues and analysis

### Issue 1: Whether the application for initiating the Insolvency Resolution Process against the personal …

**Ratio:** Section 95(1) of the IBC, 2016 allows a creditor to apply for initiating the insolvency

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**Reasoning:** The court considered the application filed under Section 95(1) of the IBC, 2016, read

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

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

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## Parties

- **Judges:** Rajasekha…; Harish Chander…
- **Appellants:** Central Bank of…
- **Respondents:** BRG Iron & Steel…; SANDEEP…

## Timeline

- **1970-01-01 — Banking Compa…**: The Applicant is a statutory body Corporate constituted under the Banking Companies…
- **2012-07-10 — Loan Req…**: BRG requested the applicant vide a letter dated 10.07.2012 for granting Non- Fund based…

## 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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