# In the matter of Canara Bank vs. Jayshree M Limbani

> NCLT judgment dated 2024-09-04. Citation: TCN-2024-NCLT-00678. The case pertains to a company petition filed by Canara Bank [Stressed Asset Management Branch]…

- **Court:** NCLT
- **Order date:** 4 Sept 2024
- **Citation:** TCN-2024-NCLT-00678
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/canara-bank-vs-jayshree-m-limbani-123c3eb1

## Summary

### Background

The case pertains to a company petition filed by Canara Bank [Stressed Asset Management Branch] under Section 95(1) of the Insolvency and Bankruptcy Code, 2016, seeking to initiate the Insolvency Resolution Process against Jayshree M. Limbani, who is a personal guarantor to the corporate debtor, Elegant Forge & Equipments Private Limited. Canara Bank had sanctioned a term loan of Rs. 50,00,00,000/- to the corporate debtor, and Jayshree M. Limbani provided a deed of personal guarantee dated 02.03.2019. The corporate debtor defaulted on its payment obligations, leading to the bank classifying the credit facilities as a non-performing asset (NPA) on 30.11.2021. A legal notice was issued to the corporate debtor and the guarantor, and a demand notice in form-B was

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## Facts

Canara Bank sanctioned a term loan of Rs. 50,00,00,000/- to Elegant Forge & Equipments Private Limited on 05th October 2018. Jayshree M. Limbani provided a deed of personal guarantee dated 02.03.2019 to secure the loan. The corporate debtor defaulted on its payment obligations, leading to the classification of the credit facilities as a non-performing asset (NPA) on 30.11.2021. Jayshree M. Limbani secured the Term Loan via mortgaging Flat No. 804 and 904, 8th Floor & 9th Floor B wing Zeerawali Residency. A legal notice was issued to the corporate debtor and the guarantor, and a demand notice in form-B was issued to the guarantor on 17.11.2023. As of 17.11.2023, a sum of Rs. 71,42,72,499.22/- was outstanding. The payment obligation arises out of a Deed of

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## Issues and analysis

### Issue 1: Whether the petition for initiating insolvency resolution process against the Personal Guarantor to …

**Ratio:** The court relied on the provisions of Section 95(1) of the Insolvency and Bankruptcy

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**Reasoning:** The court found the petition to be complete in all respects and noted that the applicant

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**Interpretation:** The court interpreted the provisions of the IBC and the rules framed thereunder

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

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## Parties

- **Judges:** Charanjeet Singh…; Smt Lakshmi…
- **Appellants:** Canara Bank…
- **Respondents:** Elegant Forge &…; Jayshree M.…

## Timeline

- **2018-10-05 — Term Loan San…**: Canara Bank sanctioned a term loan of Rs. 50,00,00,000/- to Elegant Forge & Equipments…
- **2019-02-03 — Deed of Gua…**: Jayshree M. Limbani provided a…

## 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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