# In the matter of Dhanlaxmi Bank Ltd Vs. Anil Sabastain & Ors, CP (IBC)/2/KOB/2023

> NCLT judgment dated 2023-03-01. Citation: TCN-2023-NCLT-04400. The case involves applications filed by Dhanlaxmi Bank Limited under Section 95(1) of the…

- **Court:** NCLT
- **Order date:** 1 Mar 2023
- **Citation:** TCN-2023-NCLT-04400
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/dhanlaxmi-bank-ltd-vs-anil-sabastain-ors-cp-09bdaf45

## Summary

### Background

The case involves applications filed by Dhanlaxmi Bank Limited under Section 95(1) of the Insolvency and Bankruptcy Code, 2016, read with Rule 7(2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019, against Mr. Anil Sebastain, Mr. Dinesh Kumar, Mr. Aby P Raj, and Mr. Anil P Raj, who are personal guarantors of the Corporate Debtor, Dianby Retailors Pvt Ltd, for initiating Insolvency Resolution Process. The Corporate Debtor had availed cash credit facilities from the Financial Creditor. As security for the loan, the directors of the CD mortgaged their personal properties.

## Facts

Dhanlaxmi Bank Limited filed applications under Section 95(1) of the Insolvency and Bankruptcy Code, 2016, against Mr. Anil Sebastain, Mr. Dinesh Kumar, Mr. Aby P Raj, and Mr. Anil P Raj, who are personal guarantors of Dianby Retailors Pvt Ltd. Dianby Retailors Pvt Ltd availed cash credit facilities from Dhanlaxmi Bank. The initial facility was Rs. 40,00,000, sanctioned on 25.06.2010, for running a retail showroom. The CD executed a cash credit agreement, general hypothecation agreement, and demand promissory note dated 30.06.2010. As security, Mr. Aby P Raj and Mr. Anil P Raj mortgaged their personal properties via a memorandum of deposit of title deeds dated 01.07.2010. Subsequently, an additional cash credit facility was granted on 02.08.2013, increasing the loan

…

## Issues and analysis

### Issue 1: Whether the applications filed by the Financial Creditor under Section 95(1) of the Insolvency and …

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

…

**Reasoning:** The Tribunal considered the provisions of Section 95(1) and the Supreme Court's decision

…

**Interpretation:** Section 95(1) is interpreted to mean that a creditor can initiate insolvency

…

**Application:** The Tribunal applied Section 95(1) and the Supreme Court's decision to the

…

## Parties

- **Judges:** P. Moha…; Satya Ranjan…
- **Appellants:** Dhanlaxmi Bank…
- **Respondents:** Dianby Retailors…; ANIL SEBA…

## Timeline

- **2010-06-25 — Sanction…**: Dhanlaxmi Bank sanctioned a cash credit facility of Rs. 40,00,000 to Dianby Retailors Pvt…
- **2010-06-30 — Execution of A…**: CD executed Cash credit agreement, General hypothecation agreement, Demand Promissory…

## 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)

---

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/dhanlaxmi-bank-ltd-vs-anil-sabastain-ors-cp-09bdaf45