# In the matter of Central Bank of India Vs. Kotha Kasi Viswanandham, CP (IB) No. 94/95/AMR/2022

> NCLT judgment dated 2023-01-25. Citation: TCN-2023-NCLT-04885. 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-04885
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/central-bank-of-india-vs-kotha-kasi-viswanandham-cp-6742ac5a

## 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 (Sri Ananda Lakshmi Narasimha Industries Private Limited) had availed various credit facilities from the Financial Creditor (Central Bank of India), with Mr. Kotha Kasi Viswanandham acting as the guarantor. The Corporate Debtor defaulted on repayment, leading to the Financial Creditor approaching the Debt Recovery Tribunal (DRT). The DRT directed

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## Facts

The Central Bank of India (Financial Creditor) filed a petition against Mr. Kotha Kasi Viswanandham (Personal Guarantor) and Sri Ananda Lakshmi Narasimha Industries India Private Limited (Corporate Debtor). The Corporate Debtor availed credit facilities from the Financial Creditor, with the Personal Guarantor providing a guarantee. The Corporate Debtor defaulted on repayments, resulting in loan accounts becoming irregular. The Financial Creditor issued a recall letter on 2020-03-17, requesting the Corporate Debtor to clear dues of Rs. 32,34,97,219.64 within 7 days. The Corporate Debtor failed to repay, leading the Financial Creditor to approach the Debt Recovery Tribunal (DRT). The DRT disposed of the matter on 2022-04-04, directing the Corporate Debtor to pay Rs.

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## Issues and analysis

### Issue 1: Whether the Company Petition filed by the Financial Creditor is maintainable under Section 60(2) …

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

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**Reasoning:** The court noted that the petition was filed under the correct sections of the IBC and

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**Interpretation:** Section 95 of IBC provides a mechanism for creditors to pursue insolvency

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**Application:** The Financial Creditor correctly invoked Section 95 read with Section 60(2) and

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## Parties

- **Judges:** TELAPROLU…
- **Appellants:** Central Bank of…
- **Respondents:** Ananda Lakshmi…; Kotha Kasi…

## Timeline

- **2013-03-13 — Guarantee Ex…**: Guarantee executed by Respondent No.1 for credit facilities availed by the Corporate…
- **2014-03-29 — Guarantee Ex…**: Guarantee executed by Respondent No.1 for credit facilities availed by the Corporate…

## 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)

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