# In the matter of IDBI Bank Ltd. vs. Madan Lal Goyal

> NCLT judgment dated 2022-06-16. Citation: TCN-2022-NCLT-02221. The case involves an application under Section 95(1) of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 16 Jun 2022
- **Citation:** TCN-2022-NCLT-02221
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/idbi-bank-ltd-vs-madan-lal-goyal-20b95401

## Summary

### Background

The case involves an application under Section 95(1) of the Insolvency and Bankruptcy Code, 2016. IDBI Bank Limited, the Financial Creditor, filed a petition for the initiation of the Insolvency Resolution Process against the respondent, who is the Personal Guarantor of the Corporate Debtor. The petition was filed due to a default committed by the Principal Borrower, M/s. SPG Multi Trade Pvt. Ltd., for an amount of Rs. 63,71,41,818.28 crores with interest.

## Facts

IDBI Bank Limited filed a petition under Section 95(1) of the Insolvency and Bankruptcy Code, 2016, against Madan Lal Goyal, the Personal Guarantor of the Corporate Debtor, M/s. SPG Multi Trade Pvt. Ltd. The petition was filed due to a default committed by the Principal Borrower, M/s. SPG Multi Trade Pvt. Ltd., for an amount of Rs. 63,71,41,818.28 crores with interest. A demand notice dated 07.12.2020 was issued invoking the Guarantee against the respondent. The respondent had executed a deed of Guarantee dated 27.05.2019, agreeing to pay the amount in case of default. The Financial Creditor suggested the name of the Insolvency Professional.

## Issues and analysis

### Issue 1: Whether the petition filed by IDBI Bank Limited under Section 95(1) of the Insolvency and …

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

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**Reasoning:** The court considered the provisions of Section 95(1) of the Insolvency and Bankruptcy

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

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**Application:** The court applied Section 95(1) to the facts of the case, where IDBI Bank

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## Parties

- **Judges:** SHRI. H.V.SUBBA…; Chandra Bha…; +1 more
- **Appellants:** IDBI Bank L…
- **Respondents:** SPG Multi Trade…; Madan Lal…
- **Advocates:** Bindu B…; Abhinav M…

## Timeline

- **2019-05-27 — Execution of Guarantee…**: The respondent, Madan Lal Goyal, executed a deed of Guarantee agreeing to pay an amount…
- **2020-12-07 — Demand N…**: A demand notice was issued invoking the…

## 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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