# In the matter of State Bank of India vs. Basani Mar Reddy

> NCLT judgment dated 2022-02-04. Citation: TCN-2022-NCLT-04260. The case involves an application filed by the State Bank of India (Financial Creditor) under…

- **Court:** NCLT
- **Order date:** 4 Feb 2022
- **Citation:** TCN-2022-NCLT-04260
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/state-bank-of-india-vs-basani-mar-reddy-9960bd4a

## Summary

### Background

The case involves an application filed by the State Bank of India (Financial Creditor) under Section 95(1) of the Insolvency and Bankruptcy Code (IBC), 2016, to initiate the Insolvency Resolution Process against Mr. Basani Mar Reddy, the Personal Guarantor of the Corporate Debtor, M/s. Indu Projects Limited. Indu Projects Limited, engaged in infrastructure construction, availed financial assistance from the Financial Creditor and associate banks. Mr. Reddy executed a guarantee agreement to secure the repayment. Due to operational stress, the Corporate Debtor defaulted on its obligations and was referred to the Corporate Debt Restructuring (CDR) Cell. A Master Restructuring Agreement (MRA) was entered into on 2012-09-28. The Corporate Debtor's account was classified as

…

## Facts

M/s. Indu Projects Limited, a Corporate Debtor engaged in infrastructure construction, availed financial assistance from the State Bank of India (Financial Creditor) and its associate banks. Mr. Basani Mar Reddy acted as the Personal Guarantor, executing a guarantee agreement to secure the repayment of the financial assistance. Due to operational stress, the Corporate Debtor defaulted on its debt service obligations, leading to a referral to the Corporate Debt Restructuring (CDR) Cell. A Master Restructuring Agreement (MRA) was executed on 2012-09-28. The account was classified as NPA on 2014-09-15. The Financial Creditor initiated measures under the SARFAESI Act, and an associate bank obtained a decree from the Debt Recovery Tribunal (DRT) for Rs.208,99,61,156.09/-

…

## Issues and analysis

### Issue 1: Whether the application filed by the Financial Creditor under Section 95 of the Insolvency and …

**Ratio:** Section 95 of the Insolvency and Bankruptcy Code, 2016, allows a financial creditor to

…

**Reasoning:** The court considered the provisions of Section 95 of the IBC, 2016, and the related

…

**Interpretation:** Section 95 of the IBC, 2016, is interpreted to provide a mechanism for

…

**Application:** The Financial Creditor filed the application under Section 95 of the IBC, 2016,

…

## Parties

- **Judges:** Bhaskara Pantula…; BINOD KUMAR…
- **Appellants:** State Bank of…
- **Respondents:** Indu Projects…; Basani Mar…

## Timeline

- **2012-09-28 — Master Restructuring…**: The Corporate Debtor, Financial Creditor, and associate banks entered into a Master…
- **2014-09-15 — Account Classified as…**: The account of the Corporate Debtor was…

## 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)

---

This is a preview. The full structured summary, issues, precedents and source judgment are available on CaseEase - Legal Intelligence Simplified: https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/state-bank-of-india-vs-basani-mar-reddy-9960bd4a