# In the matter of Bank of Baroda Vs. Ashoke Kumar Kharkia, CP (IB)/120(KB)/2022

> NCLT judgment dated 2022-07-11. Citation: TCN-2022-NCLT-01777. The case involves an application filed by Bank of Baroda under Section 95(1) of the Insolvency…

- **Court:** NCLT
- **Order date:** 11 Jul 2022
- **Citation:** TCN-2022-NCLT-01777
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/bank-of-baroda-vs-ashoke-kumar-kharkia-cp-081c4d86

## Summary

### Background

The case involves an application filed by Bank of Baroda 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 Debtor) Rules, 2019, to initiate the Insolvency Resolution Process against Mr. Ashoke Kumar Kharkia, the personal guarantor of Kharkia Steels Private Limited (KSPL). KSPL had availed credit facilities from Bank of Baroda, and Mr. Kharkia had provided personal guarantees for these facilities. KSPL defaulted on repayments, leading to its classification as a non-performing asset (NPA).

## Facts

Kharkia Steels Private Limited (KSPL) availed various credit facilities from Bank of Baroda, sanctioned and renewed over time. Mr. Ashoke Kumar Kharkia provided personal guarantees for these facilities. KSPL defaulted on the repayment of the credit facilities, leading to its accounts being classified as a non-performing asset (NPA) on 2013-08-31. Bank of Baroda issued a letter demanding outstanding dues of Rs. 14,50,89,908.33 to Mr. Kharkia on 2014-05-16 and a statutory demand notice on 2014-08-14. Bank of Baroda, along with other consortium banks, filed an Original Application (OA No. 682 of 2014) before the Debts Recovery Tribunal II, Kolkata, for the recovery of outstanding dues. CIRP was initiated against KSPL, and a resolution plan was approved on 2020-09-21. Mr.

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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 application filed by Bank of Baroda, the evidence of the

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

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**Application:** Given that KSPL defaulted on its debt and Mr. Kharkia provided personal

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## Parties

- **Judges:** RohitKa…; Harish Chander…
- **Appellants:** Bank of B…
- **Respondents:** Kharkia Steels…; ASHOKE KUMAR…
- **Advocates:** Ramesh Ch.…; Mahuya…; +2 more

## Timeline

- **2007-12-12 — Credit Facilities…**: KSPL availed various credit…
- **2009-07-23 — Credit Facilities…**: Credit facilities availed…

## 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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