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

> NCLT judgment dated 2023-03-31. Citation: TCN-2023-NCLT-03954. 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-03954
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/rare-asset-reconstruction-ltd-vs-sukesh-gupta-97b401c8

## 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

Rare Asset Reconstruction Limited, the financial creditor, filed a petition under Section 95(1) of the Insolvency and Bankruptcy Code, 2016, seeking to initiate 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. Sukesh Gupta stood as guarantor and executed guarantee agreements dated 09.02.2011. ICICI Bank assigned its rights to Rare Asset Reconstruction Limited 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 on 17.12.2021 to the personal guarantor after the corporate debtor and personal guarantor failed to pay the outstanding

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## Issues and analysis

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

**Ratio:** The legal principle is that if a personal guarantor has provided a guarantee for the

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**Reasoning:** The Adjudicating Authority considered the arguments of both parties, including the

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**Interpretation:** Section 100 of the IBC allows for the initiation of the Insolvency Resolution

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**Application:** The Adjudicating Authority applied the principle to the facts of the case,

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## Parties

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

## Timeline

- **2011-02-09 — Guarantee Agr…**: Sukesh Gupta executed…
- **2019-11-13 — CIRP initiated against…**: Corporate Insolvency Resolution Process initiated against M/s. MBS Impex Private Limited…

## 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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