# In the matter of Central Bank of India Vs. Sandeep Goyal, CP (IB)/187(KB)2021

> NCLT judgment dated 2022-04-26. Citation: TCN-2022-NCLT-03058. The case pertains to an application filed under Section 95 of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 26 Apr 2022
- **Citation:** TCN-2022-NCLT-03058
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/central-bank-of-india-vs-sandeep-goyal-cp-86ef3636

## Summary

### Background

The case pertains to an application filed under Section 95 of the Insolvency and Bankruptcy Code, 2016, read with Rule 7(2) of the Insolvency and Bankruptcy (Application to the Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019. Central Bank of India, acting as the financial creditor, initiated proceedings against Sandeep Goyal, the personal guarantor of BRG Iron and Steel Co.(P) Ltd., the corporate debtor. The corporate debtor was admitted into Corporate Insolvency Resolution Process (CIRP) vide order dated 03/02/2020. The Resolution Professional was appointed to assess the petition and submit a report.

## Facts

Central Bank of India extended various loan facilities to BRG Iron and Steel Co.(P) Ltd., with Sandeep Goyal acting as the personal guarantor, as evidenced by a Deed of Guarantee dated 21.07.2014 and 08.03.2016. BRG Iron & Steel Co.(P) Ltd. defaulted on payments, leading to its admission into Corporate Insolvency Resolution Process (CIRP) on 03/02/2020. The default was adjudicated vide notice of invocation made by the financial creditor on 25.02.2021. The personal guarantor also failed to make payments as per the agreement, with an outstanding amount of Rs.271.79 Crore as of 03.02.2020, along with further interest. The applicant has already initiated action under Recovery of Debts due to Banks and Financial Institutions Act, 1993, which is presently pending before

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## Issues and analysis

### Issue 1: Whether the application filed by Central Bank of India under Section 95(1) of the Insolvency and …

**Ratio:** Section 95(1) of the Insolvency and Bankruptcy Code, 2016, allows a creditor to file an

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**Reasoning:** The Adjudicating Authority considered the report of the Resolution Professional, which

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**Interpretation:** Section 95(1) provides a mechanism for creditors to recover debts from personal

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**Application:** The Adjudicating Authority applied Section 95(1) to the facts of the case,

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## Parties

- **Judges:** Rajasekha…; Balraj…
- **Appellants:** Central Bank of…
- **Respondents:** BRG Iron and…; Sandeep…

## Timeline

- **2014-07-21 — Deed of Gua…**: Deed of Guarantee executed between…
- **2016-03-08 — Deed of Gua…**: Deed of Guarantee executed between…

## 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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