# In the matter of Central Bank of India Vs. Chavva Naga Lakshmi, CP (IB) No. 93/95/AMR/2022

> NCLT judgment dated 2022-10-10. Citation: TCN-2022-NCLT-00801. The Central Bank of India, as the Financial Creditor, filed a petition under Section 95 of the…

- **Court:** NCLT
- **Order date:** 10 Oct 2022
- **Citation:** TCN-2022-NCLT-00801
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/central-bank-of-india-vs-chavva-naga-lakshmi-cp-1a29f487

## Summary

### Background

The Central Bank of India, as the Financial Creditor, filed a petition under Section 95 of the Insolvency and Bankruptcy Code (IBC), 2016, against Smt. Chavva Naga Lakshmi, the Personal Guarantor (Respondent No. 1), and Sri Ananda Lakshmi Narasimha Industries India Private Limited, the Corporate Debtor (Respondent No. 2). The application sought to initiate the Corporate Insolvency Resolution Process (CIRP). The Corporate Debtor had availed credit facilities totaling INR 33,18,09,761.02 from the Financial Creditor. Respondent No. 1 acted as a personal guarantor for these facilities. After the Corporate Debtor defaulted, the Financial Creditor issued a recall letter on 17.03.2020 for INR 32,34,97,219.64. Subsequently, the Financial Creditor approached the Debt Recovery

…

## Facts

The Central Bank of India (Financial Creditor) extended credit facilities to Sri Ananda Lakshmi Narasimha Industries India Private Limited (Corporate Debtor), totaling INR 33,18,09,761.02. Smt. Chavva Naga Lakshmi (Respondent No. 1) acted as a personal guarantor for these credit facilities, executing Form Guarantees on 13.03.2013, 29.03.2014, September-2016, and 01.11.2016. The Corporate Debtor defaulted on repayments, prompting the Financial Creditor to issue a recall letter on 17.03.2020, demanding INR 32,34,97,219.64. The Corporate Debtor failed to discharge this amount. Consequently, the Financial Creditor approached the Debt Recovery Tribunal (DRT) on 05.08.2020, resulting in a DRT order on 04.04.2022, directing the Corporate Debtor to pay INR 33,93,23,650.15 as

…

## Issues and analysis

### Issue 1: Whether notice to the Personal Guarantor is required before the appointment of an Interim …

**Ratio:** The ratio is that based on the provisions of the IBC, specifically Sections 97, 99, and

…

**Reasoning:** The court reasoned that the IBC provides a specific timeline and process for insolvency

…

**Interpretation:** The interpretation is that the IBC balances the need for a swift insolvency

…

**Application:** In this specific case, the court applied the ratio and reasoning to conclude

…

## Parties

- **Judges:** TELAPROLU…
- **Appellants:** Central Bank of…
- **Respondents:** Ananda Lakshmi…; Chavva Naga…

## Timeline

- **2013-03-13 — Execution of G…**: Respondent No.1 executed Form…
- **2014-03-29 — Execution of G…**: Respondent No.1 executed Form…

## 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)

---

This is a preview. The full structured summary, issues, precedents and source judgment are available on CaseEase - Legal Intelligence Simplified: https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/central-bank-of-india-vs-chavva-naga-lakshmi-cp-1a29f487