# In the matter of PNB Housing Finance Ltd Vs. Mohit Arora CP (IB) No. 395 (ND)-2021

> NCLT judgment dated 2021-09-29. Citation: TCN-2021-NCLT-00954. PNB Housing Finance Ltd. filed an application under Section 95(1) read with Rule 7(2) of the…

- **Court:** NCLT
- **Order date:** 29 Sept 2021
- **Citation:** TCN-2021-NCLT-00954
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/pnb-housing-finance-ltd-vs-mohit-arora-cp-086656f5

## Summary

### Background

PNB Housing Finance Ltd. filed an application under Section 95(1) read with Rule 7(2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for IRP for Personal Guarantors to Corporate Debtor) Rules, 2019, to initiate the Insolvency Resolution Process against Mr. Mohit Arora, the Personal Guarantor/Debtor and Managing Director of Supertech Ltd., the Corporate Debtor. The application stems from a Loan Agreement dated 10.03.2017 between PNB Housing Finance Ltd. and Supertech Ltd., along with co-borrowers Sarv Realtors Private Limited and ASP Sarin Realty Private Limited. An irrevocable Deed of Guarantee dated 10.03.2017 was executed by Mr. Arora in favor of PNB Housing Finance Ltd. to secure the loan amount.

## Facts

PNB Housing Finance Ltd. (the Financial Creditor) extended a loan to Supertech Ltd. (the Corporate Debtor), with Mr. Mohit Arora (the Personal Guarantor) providing a guarantee for the loan. A Loan Agreement was executed on 10.03.2017. The Corporate Debtor defaulted on payments, leading the Financial Creditor to recall the loan facility and declare the account a Non-Performing Asset on 31.07.2019. The Financial Creditor invoked the personal guarantee and issued a Demand Notice on 09.07.2021, seeking payment of Rs. 3,58,91,09,333.74/-. Multiple IBC proceedings are pending against the Corporate Debtor. The Personal Guarantor argued that the application was not maintainable under Section 95 read with Section 60(1) & (2) of the Code, as CIRP had not been initiated

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## Issues and analysis

### Issue 1: Whether initiation of the Corporate Insolvency Resolution Process of the Corporate Debtor is a …

**Ratio:** Section 60(1) of the IBC states that the Adjudicating Authority for insolvency resolution

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**Reasoning:** The court reasoned that Section 179(1) of the IBC is subject to Section 60 of the IBC.

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**Interpretation:** The court interpreted Section 60 and Section 179 of the IBC to determine the

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**Application:** The court applied the ratio to the facts of the case, noting that there were

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## Parties

- **Judges:** ABNI RANJAN KUMAR…; L. N. G…
- **Appellants:** PNB Housing…
- **Respondents:** Supertech…; Mohit A…
- **Advocates:** Asth…; Alok…; +3 more

## Timeline

- **2017-03-10 — Loan Agreement…**: Loan Agreement executed between PNB…
- **2017-03-10 — Deed of Gua…**: Irrevocable Deed of Guarantee executed by Mr. Mohit Arora in favor of PNB Housing Finance…

## 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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