# In the matter of State Bank of India Vs. Balaji Shrirangrao Chaudhary, CP (IB)/1209/MB/2021

> NCLT judgment dated 2022-02-23. Citation: TCN-2022-NCLT-03997. The case involves a company petition filed by State Bank of India (SBI) under Section 95 of the…

- **Court:** NCLT
- **Order date:** 23 Feb 2022
- **Citation:** TCN-2022-NCLT-03997
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/state-bank-of-india-vs-balaji-shrirangrao-chaudhary-cp-9c13017b

## Summary

### Background

The case involves a company petition filed by State Bank of India (SBI) under Section 95 of the Insolvency and Bankruptcy Code (IBC), 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. SBI seeks to initiate an Individual Insolvency Resolution Process (IRP) against Mr. Balaji Shrirangrao Chaudhary, who acted as a personal guarantor for a debt owed by Gajanan Oil Private Limited (Corporate Debtor). An application under Section 9 of the Code by M/s Ashapura Perfoclay Ltd. (Operational Creditor) was admitted against Gajanan Oil Private Ltd. on 06.05.2019. SBI, as a financial creditor, had extended credit to the Corporate Debtor, with

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## Facts

State Bank of India (SBI) filed a company petition under Section 95 of the Insolvency and Bankruptcy Code (IBC), 2016, seeking to initiate an Individual Insolvency Resolution Process (IRP) against Mr. Balaji Shrirangrao Chaudhary, who served as the personal guarantor for the debts of Gajanan Oil Private Limited (Corporate Debtor). The Corporate Debtor faced an insolvency application filed by M/s Ashapura Perfoclay Ltd., which was admitted on 06.05.2019. SBI had extended credit to the Corporate Debtor, and Mr. Chaudhary provided a personal guarantee as per a Deed of Guarantee dated 07.09.2016. SBI issued a demand notice to Mr. Chaudhary on 17.09.2021, claiming an outstanding amount of Rs. 93,47,90,614.65/- as of 31.08.2021. The demand notice was served on 21.09.2021,

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## Issues and analysis

### Issue 1: Whether the petition filed by State Bank of India under Section 95 of the Insolvency and Bankruptcy …

**Ratio:** Section 95 of the Insolvency and Bankruptcy Code, 2016, read with Rule 7(2) of the

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**Reasoning:** The court considered the submissions made by the counsel for the petitioner and the

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

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**Application:** SBI, being a financial creditor, filed the petition under Section 95 against

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## Parties

- **Judges:** H.V. Subb…; Chandra Bha…
- **Appellants:** State Bank of…
- **Respondents:** Gajanan Oil…; BALAJI SHRIRANGRAO…

## Timeline

- **2016-09-07 — Deed of Gua…**: Mr. Balaji Shrirangrao Chaudhary…
- **2019-05-06 — Admission of Insolvency…**: The C.P. No. 3504/I&BP/2018 filed by M/s Ashapura Perfoclay Ltd. was admitted against…

## 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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