# In the matter of Central Bank of India Vs. Chavva Satya Krishna, CP (IB) No. 97/95/AMR/2022

> NCLT judgment dated 2023-01-25. Citation: TCN-2023-NCLT-04911. The Central Bank of India filed a Company Petition under Section 60(2) and 95 of the Insolvency…

- **Court:** NCLT
- **Order date:** 25 Jan 2023
- **Citation:** TCN-2023-NCLT-04911
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/central-bank-of-india-vs-chavva-satya-krishna-cp-ab3b7ffa

## Summary

### Background

The Central Bank of India filed a Company Petition under Section 60(2) and 95 of the Insolvency and Bankruptcy Code, 2016, read with Rule 7(2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Process for Personal Guarantors to Corporate Debtors) Rules, 2019, seeking to initiate the Insolvency Resolution Process against the Personal Guarantor of the Corporate Debtor. The Corporate Debtor availed various credit facilities from the Financial Creditor, with Respondent No.1 standing as guarantor. The Financial Creditor approached the Debt Recovery Tribunal (DRT) after the Corporate Debtor failed to repay the debts. The DRT directed the Corporate Debtor to pay a sum of Rs. 33,93,23,650.15/- as on 03.08.2020. The Financial Creditor issued

…

## Facts

Central Bank of India, the Financial Creditor (FC), filed a petition against Mr. Chavva Satya Krishna, the Personal Guarantor (Respondent No.1), and Sri Ananda Lakshmi Narasimha Industries India Private Limited, the Corporate Debtor (Respondent No.2). The Corporate Debtor availed various credit facilities from the FC, and Respondent No.1 acted as guarantor. The FC disbursed Rs. 33,18,09,761.02/- in various credit facilities. The Corporate Debtor created securities in favor of the FC through mortgages, hypothecation, and guarantees. The Corporate Debtor failed to adhere to the repayment terms, leading to irregular loan accounts. The FC issued a recall letter dated 17.03.2020, requesting the Corporate Debtor to clear dues of Rs. 32,34,97,219.64/-, but the Corporate

…

## Issues and analysis

### Issue 1: Whether the Company Petition filed by the Financial Creditor under Section 60(2) and 95 of the …

**Ratio:** Section 95 of the IBC allows a financial creditor to initiate insolvency resolution

…

**Reasoning:** The court noted that the Personal Guarantor did not appear to contest the Financial

…

**Interpretation:** Section 95 of the IBC and Rule 7(2) of the associated rules are interpreted to

…

**Application:** The Financial Creditor demonstrated that the Corporate Debtor defaulted on its

…

## Parties

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

## Timeline

- **2020-03-17 — Recall L…**: The Financial Creditor issued a recall letter to the Corporate Debtor requesting…
- **2020-08-05 — DRT Appr…**: The Financial Creditor approached the Debt Recovery Tribunal (DRT) vide O.A.NO.261/2020…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(2) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

---

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-satya-krishna-cp-ab3b7ffa