# In the matter of State Bank of India Vs. Rajesh K S, CP (IBC)/15/KOB/2022

> NCLT judgment dated 21 Mar 2022. Citation: TCN-2022-NCLT-03658. The State Bank of India, acting as the petitioner/creditor, initiated insolvency resolution…

- **Court:** NCLT
- **Order date:** 21 Mar 2022
- **Citation:** TCN-2022-NCLT-03658
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/state-bank-of-india-vs-rajesh-k-s-cp-ea208e6e

## Summary

### Background

The State Bank of India, acting as the petitioner/creditor, initiated insolvency resolution proceedings against five personal guarantors of M/s. Propyl Packaging Limited. These petitions were filed under Section 95(1) of the Insolvency and Bankruptcy Code, 2016, read with Rule 7(2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019. The corporate debtor, M/s. Propyl Packaging Limited, had already undergone a Corporate Insolvency Resolution Process (CIRP) which commenced on February 14, 2020, and subsequently entered liquidation on November 18, 2021, due to the absence of any viable resolution plan. The present applications target the personal guarantors who

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## Facts

The State Bank of India, through its Stressed Assets Resolution Branch, filed five petitions under Section 95(1) of the Insolvency and Bankruptcy Code, 2016, read with Rule 7(2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019. These petitions were directed against Mr. Rajesh K S, Mr. Satheesh Babu V. K, Mr. Saleesh K Satheesh, Mrs. Bindya Saleesh, and Mrs. Sindhu Rajesh, who are the personal guarantors of the corporate debtor, M/s. Propyl Packaging Limited. The common issues and laws involved in these petitions led the Tribunal to take them up together and issue a common order.

## Issues and analysis

### Issue 1: Whether the applications filed by the State Bank of India against the personal guarantors of M/s.…

**Ratio:** An application under Section 95(1) of the IBC, 2016, for initiating insolvency resolution…

**Reasoning:** The court reasoned that the applications were maintainable because the…

**Interpretation:** The court interpreted Section 95(1) and 95(4) to mean that a creditor must…

**Application:** In this case, the State Bank of India provided evidence of the corporate…

## Parties

- **Judges:** Ashok Kumar…; MEMBER (JUD…; +2 more
- **Advocates:** For Petitioner/Cre…; Shri. Vin…; +1 more

## Timeline

- **November 28, 2014 — Letter of Arr…**: State Bank of India sanctioned an overdraft facility of Rs 7.05 Crore as an International…
- **December 5, 2014 — Loan cum Hypothecation Agreement and Promissory…**: Corporate Debtor executed loan cum hypothecation agreement and demand promissory note 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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