# In the matter of Shapoorji Pallonji Finance Private Limited vs. Rekha Singh

> NCLT judgment dated 2024-01-08. Citation: TCN-2024-NCLT-03244. The case involves an application filed by Shapoorji Pallonji Finance Private Limited…

- **Court:** NCLT
- **Order date:** 8 Jan 2024
- **Citation:** TCN-2024-NCLT-03244
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/shapoorji-pallonji-finance-private-limited-vs-rekha-singh-a9d5380c

## Summary

### Background

The case involves an application filed by Shapoorji Pallonji Finance Private Limited ('Creditor'/'Applicant') under Section 95 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate Insolvency Resolution Process against Ms. Rekha Singh ('Personal Guarantor'/'Respondent'). The Personal Guarantor had provided a guarantee for loans availed by M/s Jumbo Finvest (India) Limited ('Corporate Debtor'). The Corporate Debtor defaulted on its repayment obligations, leading to the invocation of the personal guarantee. The Adjudicating Authority initially rejected the application based on preliminary objections, but the Hon'ble NCLAT set aside this order.

## Facts

Shapoorji Pallonji Finance Private Limited ('Creditor'/'Applicant') filed an application to initiate Insolvency Resolution Process against Ms. Rekha Singh ('Personal Guarantor'/'Respondent') under Section 95 of the Insolvency and Bankruptcy Code, 2016. Rekha Singh had provided a personal guarantee for loans availed by M/s Jumbo Finvest (India) Limited ('Corporate Debtor'). The loan was sanctioned on 27.03.2018 with a limit of Rs. 25 crores for 36 months. The Corporate Debtor defaulted on payments, leading to the invocation of the personal guarantee. The Corporate Debtor was notified of the default in December 2019. The Applicant deposited cheques issued by the Corporate Debtor, which were returned due to insufficient funds. The Applicant issued a notice on 07.01.2020

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## Issues and analysis

### Issue 1: Whether the application to initiate the Insolvency Resolution Process against the Personal …

**Ratio:** Section 95 of the Insolvency and Bankruptcy Code, 2016, allows for the initiation of

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**Reasoning:** The court observed that the Personal Guarantor had defaulted on payments within the

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**Interpretation:** Section 95 of the IBC is interpreted to provide a mechanism for creditors to

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**Application:** The court applied Section 95 and Rule 7 to the facts of the case, noting that

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## Parties

- **Judges:** Deep Chandr…; RAJEEV ME…
- **Appellants:** Shapoorji…
- **Respondents:** Jumbo Finvest…; REKHA S…

## Timeline

- **2018-03-27 — Loan Sanc…**: Loan was sanctioned to the Corporate…
- **2019-12-19 — Default Notif…**: Applicant notified the Corporate…

## 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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