# In the matter of RARE Asset Reconstruction Ltd. vs. Sukesh Gupta

> NCLT judgment dated 2023-03-31. Citation: TCN-2023-NCLT-03929. The case pertains to an application filed by Rare Asset Reconstruction Limited, the financial…

- **Court:** NCLT
- **Order date:** 31 Mar 2023
- **Citation:** TCN-2023-NCLT-03929
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/rare-asset-reconstruction-ltd-vs-sukesh-gupta-08fb113e

## Summary

### Background

The case pertains to an application filed by Rare Asset Reconstruction Limited, the financial creditor, 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, seeking initiation of the Insolvency Resolution Process against Sukesh Gupta, the personal guarantor of M/s. MBS Impex Private Limited, the corporate debtor. The corporate debtor had availed working capital facilities from ICICI Bank, and Sukesh Gupta stood as guarantor, executing guarantee agreements dated 09.02.2011. ICICI Bank assigned its rights to Rare Asset Reconstruction Limited on 26.08.2022. The financial creditor

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## Facts

M/s. MBS Impex Private Limited (Corporate Debtor) availed working capital facilities from ICICI Bank. Shri Sukesh Gupta acted as the personal guarantor for these facilities, executing guarantee agreements on 09.02.2011. ICICI Bank unconditionally assigned its rights and transferred the financial assistance to Rare Asset Reconstruction Limited (Financial Creditor) on 26.08.2022. The outstanding debt as of 29.11.2021 was Rs. 49,95,98,391.27/-. The Financial Creditor issued a demand notice to the Personal Guarantor on 17.12.2021, but the Personal Guarantor failed to pay the outstanding amount. The Financial Creditor then filed an application under Section 95(1) of the Insolvency and Bankruptcy Code, 2016, seeking initiation of the Insolvency Resolution Process against the

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## Issues and analysis

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

**Ratio:** The ratio is based on the interpretation and application of Section 95 and Section 100 of

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**Reasoning:** The court reasoned that the personal guarantor stood as a guarantor to the loans availed

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**Interpretation:** The interpretation involves understanding the scope and applicability of

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**Application:** The ratio and reasoning were applied to the specific facts of the case, where

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## Parties

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

## Timeline

- **2011-02-09 — Guarantee Agr…**: Sukesh Gupta executed guarantee agreements for the working capital facilities availed by…
- **2019-11-13 — CIRP against Corporate…**: Corporate Insolvency Resolution Process initiated against M/s. MBS Impex Private Limited…

## 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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