# In the matter of Central Bank vs. Kavita Aggarwal

> NCLT judgment dated 2024-08-06. Citation: TCN-2024-NCLT-00875. The case pertains to an application filed by Canara Bank, through its Resolution Professional…

- **Court:** NCLT
- **Order date:** 6 Aug 2024
- **Citation:** TCN-2024-NCLT-00875
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/central-bank-vs-kavita-aggarwal-3f50d266

## Summary

### Background

The case pertains to an application filed by Canara Bank, through its Resolution Professional (RP), under Section 95(1) of the Insolvency and Bankruptcy Code (IBC), 2016, seeking to initiate the insolvency resolution process against Ms. Kavita Aggarwal, the personal guarantor to M/s Sunstar Overseas Limited, the Corporate Debtor (CD). The CD had availed various credit facilities from a consortium of banks, including Canara Bank. Upon default, Canara Bank invoked the personal guarantee of Ms. Aggarwal and filed the petition after issuing a demand notice. The RP submitted a report recommending the admission of the petition, which was contested by the personal guarantor.

## Facts

M/s Sunstar Overseas Limited (Corporate Debtor) availed credit facilities from a consortium of banks, including Canara Bank. An Interse Agreement was executed between the banks, with Karur Vysya Bank as the lead member. Ms. Kavita Aggarwal stood as a personal guarantor for the CD. The CD defaulted on its debt, leading to the invocation of the personal guarantee by Canara Bank on 25.04.2018. ICICI Bank had previously initiated CIRP against the CD under Section 7 of the IBC, which was admitted, and a resolution plan was approved on 12.09.2019. Canara Bank issued a demand notice to Ms. Aggarwal on 16.11.2022, seeking payment of Rs 113,90,24,108.65/-. The RP filed a report recommending the admission of the petition under Section 95. The personal guarantor raised

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## Issues and analysis

### Issue 1: Whether the report of the RP was prepared in undue haste without giving an opportunity to the PG to …

**Ratio:** The RP is required to submit a report within a period of 10 days of his appointment as

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**Reasoning:** The Adjudicating Authority noted that the RP wrote a letter to the PG intimating him

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**Interpretation:** The RP fulfilled his duty by informing the PG about his appointment and seeking

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**Application:** The PG's objection was rejected because the RP had provided sufficient

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## Parties

- **Judges:** Ramalingam…; AVINASH K.…
- **Appellants:** Canara Bank…
- **Respondents:** M/s. Sunstar…; Kavita Ag…

## Timeline

- **2010-01-29 — Interse Agr…**: An Interse Agreement was executed between Karur Vysya Bank Ltd. and other consortium…
- **2015-10-30 — Board Reso…**: A board resolution was passed by the CD for approval of Draft Master Restructuring…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 95(1) — Application by creditor to initiate insolvency…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-95)

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