# In the matter of SBI Vs. S R Ramprasad, CP (IB) No. 77/BB/2022

> NCLT judgment dated 2022-02-24. Citation: TCN-2022-NCLT-03984. The State Bank of India filed an application under Section 95(1) of the Insolvency and…

- **Court:** NCLT
- **Order date:** 24 Feb 2022
- **Citation:** TCN-2022-NCLT-03984
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/sbi-vs-s-r-ramprasad-cp-5f18253c

## Summary

### Background

The State Bank of India filed an application under Section 95(1) of the Insolvency and Bankruptcy Code, 2016, seeking to initiate the Insolvency Resolution Process against Mr. S.R Ramprasad, the personal guarantor for credit facilities extended to M/s. Sura Leathers Private Limited, the Corporate Debtor. The Corporate Debtor defaulted on its credit facilities, leading to its classification as a Non-Performing Asset on 28.12.2017. The Applicant Bank issued a Demand Notice on 14.08.2018 invoking the personal guarantee and subsequently issued another demand notice (Form B) on 10.03.2021 for Rs 29,50,45,488.69. The Resolution Professional, Mr. Hem Chandra, was appointed and filed a report recommending the admission of the application.

## Facts

State Bank of India (SBI) extended credit facilities to M/s. Sura Leathers Private Limited, with Mr. S.R Ramprasad acting as the personal guarantor. The Corporate Debtor, M/s. Sura Leathers Private Limited, defaulted on the credit facilities, leading SBI to classify the account as a Non-Performing Asset (NPA) on 2017-12-28. SBI issued a demand notice to Mr. Ramprasad on 2018-08-14, invoking the personal guarantee. A subsequent demand notice (Form B) was issued on 2021-03-10, demanding payment of Rs 29,50,45,488.69. Mr. Ramprasad failed to settle his liabilities. SBI then filed an application under Section 95(1) of the Insolvency and Bankruptcy Code (IBC), 2016, to initiate the Insolvency Resolution Process (IRP) against Mr. Ramprasad. The Resolution Professional (RP),

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## Issues and analysis

### Issue 1: Whether the application under Section 95(1) of the IBC, 2016 for initiating Insolvency Resolution …

**Ratio:** Section 95(1) of the IBC, 2016 allows a financial creditor to apply for initiating the

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**Reasoning:** The Resolution Professional's report recommended the admission of the application, noting

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**Interpretation:** Section 95(1) provides a mechanism for creditors to recover debts from personal

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**Application:** The application was filed by State Bank of India, the financial creditor,

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## Parties

- **Judges:** Ajay Kumar…; Manoj Kumar…
- **Appellants:** State Bank of…
- **Respondents:** M/s Sura Leathers…; S.R Ramp…
- **Advocates:** P. Chitra N…; Shri. Amit…

## Timeline

- **2017-12-28 — Account Classified as…**: The account of M/s. Sura Leathers Private Limited was classified as a Non-Performing…
- **2018-08-14 — Demand Notice…**: State Bank of India issued a demand notice to Mr. S.R Ramprasad invoking the personal…

## 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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