# In the matter of Indian Bank Vs. Varez Karsi Dadina, CP (IB) No. 116/(KB)/2021

> NCLT judgment dated 2021-09-07. Citation: TCN-2021-NCLT-01178. Indian Bank, a body corporate, extended credit facilities to KND Engineering Technologies…

- **Court:** NCLT
- **Order date:** 7 Sept 2021
- **Citation:** TCN-2021-NCLT-01178
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/indian-bank-vs-varez-karsi-dadina-cp-ac9485c2

## Summary

### Background

Indian Bank, a body corporate, extended credit facilities to KND Engineering Technologies Limited, with a sanction limit of Rs. 55.00 crores around 2010. The credit facility was enhanced over time, and as of 13.10.2020, the outstanding debt and uncharged interest amounted to Rs.62,03,13,655.62. The Corporate Debtor, acting as a guarantor, provided a personal guarantee to secure the loan. Despite enjoying the loan limit, KND Engineering Technologies Limited failed to meet interest obligations, leading to the loan accounts being classified as NPA on 02.05.2018. Subsequently, an operational creditor initiated insolvency proceedings against KND Engineering Technologies Limited, which were admitted on 30.08.2018. A resolution plan was approved on 04.06.2019. The Financial

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## Facts

Indian Bank extended credit facilities to KND Engineering Technologies Limited, reaching a debt of Rs. 62,03,13,655.62 by 13.10.2020. Ms. Varez Karsi Dadina, a director of KND Engineering Technologies Limited, provided a personal guarantee for the loan. KND Engineering Technologies Limited defaulted on loan repayments, leading to the account being classified as NPA on 02.05.2018. An earlier CIRP against KND Engineering Technologies Limited was initiated and a resolution plan was approved on 04.06.2019. Indian Bank served a notice in Form B on Ms. Dadina on 13.10.2020, demanding payment, but she failed to liquidate the dues or respond. This led Indian Bank to file an application under Section 95(1) of the IBC, 2016, to initiate the Insolvency Resolution Process against

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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 provisions of Section 95(1) of the IBC, 2016, and the related

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

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

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## Parties

- **Judges:** Rajasekha…; Harish Chander…
- **Respondents:** KND Engineering…; Varez Karsi…

## Timeline

- **2010-01-01 — Credit Facility…**: Indian Bank sanctioned a credit facility of Rs. 55.00 crores to KND Engineering…
- **2018-05-02 — Account Classified as…**: The loan accounts of KND Engineering Technologies Limited were classified as…

## 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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