# In the matter of Solapur Janata Sahakari Bank Ltd. vs. Khela Dattu Jhinje

> NCLT judgment dated 2024-03-01. Citation: TCN-2024-NCLT-02283. The petition was filed on 2022-03-12 under Section 95 of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 1 Mar 2024
- **Citation:** TCN-2024-NCLT-02283
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/solapur-janata-sahakari-bank-ltd-vs-khela-dattu-jhinje-ae2a16ff

## Summary

### Background

The petition was filed on 2022-03-12 under Section 95 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 Debtors) Rules, 2019, by Solapur Janata Sahakari Bank Limited, the Financial Creditor, to initiate insolvency resolution process against Mr. Khela Dattu Jhinje, the Personal Guarantor, for recovery of a principal amount of INR 5,41,40,285 and interest of INR 8,00,72,494, totaling INR 13,42,12,779 as of 2021-09-30. The date of default is 2017-03-31, per the Property Mortgaged Loan.

## Facts

Solapur Janata Sahakari Bank Limited, the Financial Creditor, filed a petition under Section 95 of the Insolvency and Bankruptcy Code, 2016, to initiate insolvency resolution process against Mr. Khela Dattu Jhinje, the Personal Guarantor, for recovery of INR 13,42,12,779, which includes principal and interest, as of 2021-09-30. The default date is 2017-03-31. Shetkari Sakhar Karkhana (Chandipur) Limited, the Corporate Debtor, had been sanctioned short-term security facilities by the Financial Creditor. The Personal Guarantor had executed a Personal Guarantee and Mortgage Deed. A CIRP had been initiated against the Corporate Debtor. The Financial Creditor issued a Demand Notice to the Personal Guarantor, who disputed the claim. The Insolvency Resolution Professional

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## Issues and analysis

### Issue 1: Whether the application under Section 95 of the IBC, 2016, for initiating insolvency resolution …

**Ratio:** The liability of a surety is co-extensive with that of the principal debtor. The Hon'ble

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**Reasoning:** The court considered the report of the Resolution Professional, who recommended the

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**Interpretation:** Section 95 of the IBC, 2016 allows a financial creditor to initiate insolvency

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**Application:** Based on the facts presented and the report of the Resolution Professional, the

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## Parties

- **Judges:** Anu Jagmoha…; KISHORE VEMULAPALL…
- **Appellants:** Solapur Janata…
- **Respondents:** Shetkari Sakhar…; Khela Dattu…

## Timeline

- **2015-08-20 — Sanction Lett…**: Shetkari Sakhar Karkhana (Chandipur) Limited was sanctioned short-term other security…
- **2015-09-21 — Execution of Personal Guarantee and Mortgage…**: The Personal Guarantor executed the Personal Guarantee and Mortgage Deed dated 21.09.2015…

## 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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