# In the matter of Rare Asset Reconstruction Ltd. vs. Neetu Gupta

> NCLT judgment dated 2023-03-27. Citation: TCN-2023-NCLT-04046. The case pertains to a Company Petition (IB/144/2022) filed under Section 95 of the Insolvency…

- **Court:** NCLT
- **Order date:** 27 Mar 2023
- **Citation:** TCN-2023-NCLT-04046
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/rare-asset-reconstruction-ltd-vs-neetu-gupta-ef28a782

## Summary

### Background

The case pertains to a Company Petition (IB/144/2022) filed under Section 95 of the Insolvency and Bankruptcy Code (IBC), 2016, seeking initiation of the Insolvency Resolution Process against Ms. Neetu Gupta, the Personal Guarantor of M/s. MBS Impex Private Limited. ICICI Bank initially provided financial assistance to the Corporate Debtor, for which Ms. Gupta stood as guarantor, executing guarantee agreements on 09.02.2011. ICICI Bank assigned its rights to Rare Asset Reconstruction Limited on 26.08.2022. The Corporate Debtor allegedly defaulted on its payments, leading to the financial creditor filing the petition. The Debt Recovery Tribunal (DRT) had previously passed a decree and issued a recovery certificate against the corporate debtor and guarantors.

## Facts

ICICI Bank provided financial assistance to M/s. MBS Impex Private Limited, with Ms. Neetu Gupta acting as the personal guarantor, executing guarantee agreements dated 09.02.2011. The corporate debtor defaulted on payments. ICICI Bank assigned its rights to Rare Asset Reconstruction Limited on 26.08.2022. The outstanding debt as of 30.09.2021 was Rs. 49,95,98,391.27/-. The Debt Recovery Tribunal (DRT) had passed a decree and issued a recovery certificate. The financial creditor issued a demand notice on 17.12.2021 to the personal guarantor. The personal guarantor objected to the application, citing limitation and arguing that the corporate debtor's assets were more valuable than the dues claimed. The financial creditor argued that the application was not barred by

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## Issues and analysis

### Issue 1: Whether an Insolvency Resolution Process can be ordered against the Personal Guarantor under …

**Ratio:** Section 100 of the Insolvency and Bankruptcy Code, 2016 allows for the initiation of an

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**Reasoning:** The Adjudicating Authority reasoned that the Personal Guarantor stood as a guarantor to

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**Interpretation:** The interpretation of Section 100 is that it provides a mechanism for creditors

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**Application:** In this case, the ratio and reasoning were applied to the specific facts, where

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## Parties

- **Judges:** Venkata Ramakrishn…; SH. CHARAN…
- **Appellants:** RARE Asset…
- **Respondents:** M/s.MBS Impex…; Neetu G…

## Timeline

- **2011-02-09 — Guarantee Agreements…**: Ms. Neetu Gupta executed guarantee…
- **2021-12-17 — Demand Notice…**: Financial creditor issued demand…

## Legal provisions

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

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