# In the matter of Canara Bank vs. Rajneesh Dagar

> NCLT judgment dated 2024-11-05. Citation: TCN-2024-NCLT-00303. Canara Bank filed CP-IB/791/ND/2022 under Section 95 of the IBC, 2016, against Rajneesh Nagar,…

- **Court:** NCLT
- **Order date:** 5 Nov 2024
- **Citation:** TCN-2024-NCLT-00303
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/canara-bank-vs-rajneesh-dagar-c3a7f938

## Summary

### Background

Canara Bank filed CP-IB/791/ND/2022 under Section 95 of the IBC, 2016, against Rajneesh Nagar, the personal guarantor for a loan facility extended to Bulland Buildtech Private Limited (Corporate Debtor). Rajneesh Nagar executed a deed of guarantee to repay the amount payable by the Corporate Debtor to the Financial Creditor. The Resolution Professional (RP) submitted a report recommending the admission of the petition. The Respondent/Personal Guarantor (PG) raised objections, including the validity of the RP's authorization, limitation issues, and the impact of the Corporate Debtor's resolution plan. The Applicant Bank sought replacement of the RP due to suspension by IBBI, which was allowed, and a new RP was appointed.

## Facts

Canara Bank extended a loan facility to Bulland Buildtech Private Limited, for which Rajneesh Nagar stood as a personal guarantor, executing a deed of guarantee. The Corporate Debtor defaulted, leading Canara Bank to file CP-IB/791/ND/2022 under Section 95 of the IBC, 2016, against Rajneesh Nagar. The total debt including interest and penalties was Rs. 489,452,162.90, with a default amount of Rs. 29,14,98,274.75 as of the NPA date. The date of default occurred on 29.06.2018. A demand notice was issued to Rajneesh Nagar on 18.07.2022. The RP recommended the admission of the petition, but Rajneesh Nagar raised objections, including the validity of the RP's authorization, limitation issues, and the impact of the Corporate Debtor's resolution plan. The Corporate Debtor

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## Issues and analysis

### Issue 1: Whether parallel proceedings against the Personal Guarantor are maintainable given the ongoing CIRP …

**Ratio:** The Hon'ble Supreme Court in State Bank of India v. V. Ramakrishnan [(2018) 17 SCC 394]

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**Reasoning:** The Adjudicating Authority relied on the judgments of the Hon'ble Supreme Court, which

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**Interpretation:** Section 14 of the IBC is interpreted to provide a moratorium only for the

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**Application:** The Adjudicating Authority applied the principle that the CIRP against the

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## Parties

- **Judges:** SH. ASHOK KUMAR…; SH. SUBRATA KUMAR…
- **Appellants:** Canara…
- **Respondents:** Bulland Buildtech…; Rajneesh…

## Timeline

- **2016-08-08 — Guarantee Deed…**: Guarantee Deed executed between…
- **2018-06-29 — Date of D…**: Date on which the…

## 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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