# In the matter of Canara Bank vs. Krishan Pal Singh

> NCLT judgment dated 2024-01-15. Citation: TCN-2024-NCLT-03067. Canara Bank, as the Applicant, initiated proceedings against the Corporate Debtor, Bulland…

- **Court:** NCLT
- **Order date:** 15 Jan 2024
- **Citation:** TCN-2024-NCLT-03067
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/canara-bank-vs-krishan-pal-singh-ef77a8f8

## Summary

### Background

Canara Bank, as the Applicant, initiated proceedings against the Corporate Debtor, Bulland Buildtech Pvt. Ltd., for loan facilities availed. The loan, sanctioned on 2016-07-01, amounted to Rs. 37.80 Crores for a residential complex project. The Corporate Debtor and its guarantors, including Krishan Pal Singh, executed a guarantee deed on 2016-08-08. Due to the Principal Borrower's failure to repay, the account was declared a Non-Performing Asset on 2018-06-29. Subsequently, SARFAESI proceedings were initiated against the personal guarantors, including Krishan Pal Singh. Canara Bank initiated CIRP against the Corporate Debtor, which was admitted on 2021-03-22. The applicant issued a demand notice to the respondent on 2022-07-18, seeking payment of Rs. 48,81,28,128.03/-.

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## Facts

Canara Bank (formerly Syndicate Bank) extended loan facilities to Bulland Buildtech Pvt. Ltd. (Corporate Debtor) for a residential project, sanctioned on 2016-07-01, amounting to Rs. 37.80 Crores. Krishan Pal Singh, as a personal guarantor, executed a guarantee deed on 2016-08-08. The Corporate Debtor defaulted, leading to the account being declared an NPA on 2018-06-29. SARFAESI proceedings were initiated against the personal guarantors. Canara Bank initiated CIRP against the Corporate Debtor, admitted on 2021-03-22. A demand notice was issued to Krishan Pal Singh on 2022-07-18 for Rs. 48,81,28,128.03/-. Krishan Pal Singh offered a One Time Settlement (OTS) proposal of Rs. 26 Crores on 2020-09-15, which Canara Bank rejected on 2021-01-05. Sandeep Kumar Bhatt was

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## Issues and analysis

### Issue 1: Whether the Applicant/Creditor has been able to establish the ‘debt' and 'default' beyond doubt in …

**Ratio:** The principle is that a guarantor is liable for the debt of the principal borrower if the

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**Reasoning:** The Adjudicating Authority, after perusing the documents and the report of the RP, found

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**Interpretation:** This issue concerns the fundamental requirement for initiating insolvency

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**Application:** In this case, the guarantee deed, account statements, and the RP's report

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## Parties

- **Judges:** SH. ASHOK KUMAR…; SH. SUBRATA KUMAR…
- **Appellants:** Canara…
- **Respondents:** Bulland Buildtech…; Shri. Krishan Pal…
- **Advocates:** Saurabh Kus…; Kamal Deep…

## Timeline

- **2016-07-01 — Loan Sanc…**: Canara Bank sanctioned a term loan of Rs.…
- **2016-08-08 — Guarantee Deed…**: The Corporate Debtor and its Guarantors, including Krishan Pal Singh, signed/executed an…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 99 — Submission of report by resolution professional](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-99)

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