# In the matter of State Bank of India Vs. Rajbir SIngh IB-385-(ND)-2021

> NCLT judgment dated 2021-08-19. Citation: TCN-2021-NCLT-01305. This case involves an application filed by State Bank of India under Section 95 of the…

- **Court:** NCLT
- **Order date:** 19 Aug 2021
- **Citation:** TCN-2021-NCLT-01305
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/state-bank-of-india-vs-rajbir-singh-ib-385-3e3bddd6

## Summary

### Background

This case involves an application filed by State Bank of India under Section 95 of the Insolvency and Bankruptcy Code, 2016, against Mr. Rajbir Singh, the personal guarantor to the corporate debtor, M/s. C & C Constructions Limited. The application seeks to initiate an insolvency resolution process against the personal guarantor due to an outstanding debt of Rs. 1138.73 crores as of 31.07.2020. The corporate debtor had defaulted in repayment, leading to its admission under Corporate Insolvency Resolution Process by an NCLT, New Delhi order dated 14.02.2019.

## Facts

State Bank of India (SBI) filed an application under Section 95 of the Insolvency and Bankruptcy Code, 2016, against Mr. Rajbir Singh, the personal guarantor of M/s. C & C Constructions Limited. The application seeks to initiate an insolvency resolution process due to an outstanding debt of Rs. 1138.73 crores as of 31.07.2020. SBI had sanctioned credit facilities to the Corporate Debtor on 16.04.2007. The Corporate Debtor defaulted in repayment, leading to its admission under Corporate Insolvency Resolution Process by an NCLT order dated 14.02.2019. Mr. Rajbir Singh provided a personal guarantee in favor of M/s. SBICAP Trustee Company Limited, as per a Deed of Guarantee dated 29.04.2013. SBI invoked the personal guarantee on 24.08.2020 and issued a demand notice,

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## Issues and analysis

### Issue 1: Whether the application filed by State Bank of India under Section 95 of the Insolvency and …

**Ratio:** Section 95 of the Insolvency and Bankruptcy Code, 2016, allows a creditor to file an

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**Reasoning:** The court considered the fact that the corporate debtor, M/s. C & C Constructions

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

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**Application:** The court applied Section 95 to the facts of the case, finding that State Bank

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## Parties

- **Judges:** SHRI. P.S.N.…; SHRI. HEMANT…
- **Appellants:** State Bank of…
- **Respondents:** M/s. C & C…; Rajbir…

## Timeline

- **2007-04-16 — Sanction of Credit…**: State Bank of India sanctioned credit…
- **2013-04-29 — Deed of Gua…**: Mr. Rajbir Singh provided a personal guarantee in favor of M/s. SBICAP Trustee Company…

## Legal provisions

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

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