# In the matter of P Rajamani vs. Indian Overseas Bank

> NCLT judgment dated 2024-11-08. Citation: TCN-2024-NCLT-00285. The case involves an application filed under Section 94(1) of the Insolvency and Bankruptcy…

- **Court:** NCLT
- **Order date:** 8 Nov 2024
- **Citation:** TCN-2024-NCLT-00285
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/p-rajamani-vs-indian-overseas-bank-6b685164

## Summary

### Background

The case involves an application filed under Section 94(1) of the Insolvency and Bankruptcy Code (IBC), 2016, by Mrs. P. Rajamani, a personal guarantor to M/s. KMP Spinners Private Limited (Corporate Debtor), to initiate the Insolvency Resolution Process. The applicant has given particulars of debt pertaining to the 1st Respondent (Indian Overseas Bank) as Rs. 24,31,81,344/- and to the 2nd Respondent (Aditya Birla Finance Ltd) as Rs. 6,94,34,457/-, with default dates of 30.06.2019 and 28.08.2019 respectively. The guarantees were invoked by the respondents under Section 13(2) of the SARFAESI Act, 2002. The application was presented, and Mr. Madhu Desikan was appointed as the Interim Resolution Professional (IRP).

## Facts

Mrs. P. Rajamani, residing at 9/6, Thillai Nagar, Near IOB, Erode 638001, filed an application under Section 94(1) of the Insolvency and Bankruptcy Code, 2016, as a personal guarantor to M/s. KMP Spinners Private Limited (the Corporate Debtor). The application seeks to initiate the Insolvency Resolution Process. The debt owed to the 1st Respondent, Indian Overseas Bank, is Rs. 24,31,81,344/-, with a default date of 30.06.2019. The debt owed to the 2nd Respondent, Aditya Birla Finance Ltd, is Rs. 6,94,34,457/-, with a default date of 28.08.2019. The guarantees were invoked by both respondents under Section 13(2) of The SARFAESI Act, 2002. The Corporate Debtor defaulted on its repayment obligations, leading to the invocation of the guarantees. The Applicant placed copies

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## Issues and analysis

### Issue 1: Whether the application filed under Section 94(1) of the IBC, 2016, by the personal guarantor is …

**Ratio:** Section 94(1) of the Insolvency and Bankruptcy Code, 2016, allows a debtor to apply for

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**Reasoning:** The court considered the provisions of Section 94(1) of the IBC, 2016, and the rules made

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**Interpretation:** Section 94(1) provides the legal basis for a personal guarantor to apply for

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**Application:** The applicant, Mrs. P. Rajamani, being a personal guarantor to the Corporate

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## Parties

- **Judges:** SANJIV…; Venkataraman…
- **Appellants:** P Raja…
- **Respondents:** KMP Spinners…; Indian Overseas…
- **Advocates:** Sashi K…; A S Sat…; +2 more

## Timeline

- **2019-06-29 — Loan Accou…**: Loan account of the Corporate Debtor…
- **2019-06-30 — Default Dat…**: Date of default for the debt…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 94(1) — Application by debtor to initiate insolvency…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-94)

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