# In the matter of Central Bank of India vs. Usha Agarwal

> NCLT judgment dated 2024-12-11. Citation: TCN-2024-NCLT-00074. The case pertains to an application filed by Central Bank of India, the applicant/creditor,…

- **Court:** NCLT
- **Order date:** 11 Dec 2024
- **Citation:** TCN-2024-NCLT-00074
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/central-bank-of-india-vs-usha-agarwal-bd35ec0d

## Summary

### Background

The case pertains to an application filed by Central Bank of India, the applicant/creditor, under Section 121 read with 60(2) of the Insolvency and Bankruptcy Code, 2016, and Rule 7 of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Bankruptcy Process for Personal Guarantor to Corporate Debtor) Rules, 2019, seeking leave to initiate bankruptcy process against the personal guarantor, Smt. Usha Agarwal, of the corporate debtor, M/s Rajvir Industries Limited. The corporate debtor's account had slipped into NPA category due to default in repayment. State Bank of India, another creditor, had already filed an application under Section 7 of IBC Code 2016. The resolution professional filed a report recommending admission of the application under

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## Facts

Central Bank of India, the applicant, sought to initiate bankruptcy proceedings against Smt. Usha Agarwal, the personal guarantor of M/s Rajvir Industries Limited, the corporate debtor. The corporate debtor's account was classified as NPA due to repayment defaults. Another creditor, State Bank of India, had already initiated proceedings under Section 7 of the IBC. The resolution professional recommended admitting the application under Section 95 of the IB Code. The personal guarantor did not submit a repayment plan. The applicant had previously filed and withdrawn CP(IB) No 35/123/HDB/2023. The personal guarantor raised objections regarding the maintainability of the application, including limitation. The corporate debtor had completed its CIRP and a Successful

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## Issues and analysis

### Issue 1: Whether the Applicant/Creditor is entitled to proceed against the Respondent/Guarantor for …

**Ratio:** The three-month timeline prescribed under Section 121(2) of the IBC for filing a

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**Reasoning:** The court reasoned that the personal guarantor's objections lacked force and substance.

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**Interpretation:** Section 121(2) of the IBC, which stipulates a three-month period for filing 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:** Venkata Ramakrishn…; SH. CHARAN…
- **Appellants:** Central Bank of…
- **Respondents:** Rajvir Industries…; Ushabai A…

## Timeline

- **2021-04-26 — Tribunal admits CP No…**: Tribunal admits CP No…
- **2019-09-03 — OA filed before DRT-II,…**: The Applicant along with State Bank of India, also has filed OA before Hon'ble DRT-II,…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 121 — Application for bankruptcy](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-121)

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