# In the matter of Bank of Maharashtra Vs. Manda Venkata Mahalakshmi, CP(IB)/173/95/HDB/2022

> NCLT judgment dated 2023-03-31. Citation: TCN-2023-NCLT-03944. The Bank of Maharashtra filed a petition under Section 95 of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 31 Mar 2023
- **Citation:** TCN-2023-NCLT-03944
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/bank-of-maharashtra-vs-manda-venkata-mahalakshmi-cp-bcb74c92

## Summary

### Background

The Bank of Maharashtra filed a petition under Section 95 of the Insolvency and Bankruptcy Code, 2016, seeking initiation of the Insolvency Resolution Process against Smt. Manda Venkata Mahalakshmi, the personal guarantor of SV SVS Projects Private Limited, the corporate debtor. The corporate debtor had availed working capital facilities from the bank, and upon default, the account was declared NPA. The financial creditor issued a demand notice to the personal guarantor, who failed to pay the outstanding amount.

## Facts

Bank of Maharashtra filed a petition under Section 95 of the Insolvency and Bankruptcy Code, 2016, against Smt. Manda Venkata Mahalakshmi, the personal guarantor of SV SVS Projects Private Limited. The corporate debtor had availed working capital facilities consisting of a Cash Credit facility with a limit of Rs. 2.50 Crores and Bank Guarantee Facilities aggregating to Rs.48 Crores, totaling Rs.50.50 Crores. The corporate debtor defaulted, leading to a total principal amount of default payable of Rs.32,30,71,217.76/- along with a total interest amount of Rs.15,72,26,350.93/-, calculated until 17.05.2022. The loan account was declared NPA on 27.12.2018. The personal guarantor executed a Deed of Guarantee on 25.03.2014. The Financial Creditor issued a Form B Demand

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## Issues and analysis

### Issue 1: Whether an Insolvency Resolution Process can be ordered against the Personal Guarantor under …

**Ratio:** Section 100 of the Insolvency and Bankruptcy Code, 2016, allows for the initiation of an

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**Reasoning:** The Tribunal examined the report of the Resolution Professional, which indicated that the

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**Interpretation:** The interpretation of Section 100 involves determining whether the procedural

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**Application:** In this case, the Tribunal found that the creditor had sent the demand notice,

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## Parties

- **Judges:** Venkata Ramakrishn…; SH. CHARAN…
- **Appellants:** Bank of Mah…
- **Respondents:** SV SVS Projects…; Smt.Manda Venkata…

## Timeline

- **2014-03-24 — Sanction…**: Copies of the sanction letter dated…
- **2014-03-25 — Deed of Gua…**: Corporate Debtor, Personal Guarantor executed a Deed of Guarantee on 25.03.2014 to secure…

## 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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