# In the matter of Indian Bank Vs. Vinod Agarwal, CP (IB) No. 22/CB/2023

> NCLT judgment dated 2023-05-15. Citation: TCN-2023-NCLT-03365. The case involves an application under Section 95(1) of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 15 May 2023
- **Citation:** TCN-2023-NCLT-03365
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/indian-bank-vs-vinod-agarwal-cp-a7e18909

## Summary

### Background

The case involves an application 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 Debtor) Rules, 2019, to initiate the Insolvency Resolution Process against Mr. Vinod Agarwal, the personal guarantor, for loans availed by the corporate debtor, KVR Steels Orissa Limited. The financial creditor, Indian Bank, seeks to recover outstanding dues from the personal guarantor after the corporate debtor defaulted on its loan repayments. The application is filed before the National Company Law Tribunal (NCLT), Cuttack Bench.

## Facts

Indian Bank, the financial creditor, filed an application to initiate the Insolvency Resolution Process against Mr. Vinod Agarwal, the personal guarantor of KVR Steels Orissa Limited, the corporate debtor. KVR Steels Orissa Limited had availed credit facilities from Indian Bank, with Mr. Agarwal acting as the guarantor. The credit facilities were sanctioned and renewed multiple times between 2009 and 2016. The corporate debtor defaulted on repayments, leading to the account being declared a Non-Performing Asset (NPA) on 26.09.2018. Indian Bank issued a demand notice under Section 13(2) of the SARFESI Act, 2002, and filed OA No. 507/2019 before the Debts Recovery Tribunal-III, Kolkata, to recover outstanding dues. A Corporate Insolvency Resolution Process (CIRP)

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## Issues and analysis

### Issue 1: Whether the application under Section 95(1) of the Insolvency and Bankruptcy Code, 2016, for …

**Ratio:** The Supreme Court in Lalit Kumar Jain Vs. Union of India & Ors upheld the vires of

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**Reasoning:** The court relied on the Supreme Court's judgment, which validated the legal framework for

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**Interpretation:** The interpretation is that the legal framework for initiating insolvency

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**Application:** The ratio applies directly to the case, as it confirms the maintainability of

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## Parties

- **Judges:** P. Moha…; Satya Ranjan…
- **Appellants:** Indian…
- **Respondents:** KVR Steels Orissa…; Vinod Ag…

## Timeline

- **2009-08-13 — Sanction of Credit…**: Indian Bank sanctioned credit facilities to KVR Steels Orissa Limited, including Cash…
- **2010-12-31 — Renewal of Credit…**: Credit facilities were renewed…

## 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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