# In the matter of Canara Bank vs. Trishla Devi

> NCLT judgment dated 2024-06-04. Citation: TCN-2024-NCLT-01242. The case involves an application by Canara Bank, the Financial Creditor, to initiate the…

- **Court:** NCLT
- **Order date:** 4 Jun 2024
- **Citation:** TCN-2024-NCLT-01242
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/canara-bank-vs-trishla-devi-655fcc7a

## Summary

### Background

The case involves an application by Canara Bank, the Financial Creditor, to initiate the Insolvency Resolution Process against Trishla Devi, the personal guarantor to the Corporate Debtor, M/s Shree Basant Oils Ltd. The application is filed under Section 95 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 Debtors) Rules, 2019, and regulation 4(2) of IBBI (Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Regulations, 2019.

## Facts

Canara Bank, the Financial Creditor, filed an application to initiate the Insolvency Resolution Process against Trishla Devi, the personal guarantor to the Corporate Debtor, M/s Shree Basant Oils Ltd. The guarantor had executed deeds of guarantee for the facilities extended to M/s Shree Basant Oils Ltd. The total maximum debt sanctioned under the working capital facilities was Rs.90 Crore. A default occurred on 25.11.2019 due to non-payment by the personal guarantor. The Applicant Bank issued a statutory Demand Notice dated 23.01.2024. Trishla Devi executed a personal guarantee on 12.09.2016 in favor of the Applicant to secure the repayment of the principal amount of the Facilities along with interest. The Applicant issued a Demand Notice in Form B on 23.01.2024, but

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## Issues and analysis

### Issue 1: Whether a default exists that warrants the initiation of the Insolvency Resolution Process against …

**Ratio:** The legal principle applied is that if a default is established as per the petition filed

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**Reasoning:** The court reasoned that based on the evidence presented by the Financial Creditor, a

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**Interpretation:** The interpretation is that the Adjudicating Authority must determine whether a

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**Application:** The court applied the ratio and reasoning to the specific facts of the case,

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## Parties

- **Judges:** Praveen…; Ashish…
- **Appellants:** Canara…
- **Respondents:** M/s Shree Basant…; TRISHLA…
- **Advocates:** Ankur G…; Nilotpal…

## Timeline

- **2016-09-12 — Personal Guarantee…**: Trishla Devi executed a personal…
- **2019-11-25 — Default Oc…**: Default occurred due to…

## 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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