# In the matter of State Bank of India vs. J. Kamala

> NCLT judgment dated 2024-10-18. Citation: TCN-2024-NCLT-00399. The case involves a petition filed by State Bank of India ('Financial Creditor') under Section…

- **Court:** NCLT
- **Order date:** 18 Oct 2024
- **Citation:** TCN-2024-NCLT-00399
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/state-bank-of-india-vs-j-kamala-06b7e102

## Summary

### Background

The case involves a petition filed by State Bank of India ('Financial Creditor') under Section 95 of the Insolvency and Bankruptcy Code, 2016 (IBC) against Mrs. J. Kamala ('Personal Guarantor') for initiating the insolvency resolution process. The claim arises from a principal amount of INR 124,88,59,483.63, along with interest and penalties, related to loans availed by M/s. JKS Constructions Private Limited ('Corporate Debtor'), for which Mrs. Kamala acted as a personal guarantor. The Corporate Debtor's account was declared NPA on 28.10.2013. The Financial Creditor and Bank of Maharashtra jointly filed OA No.333 of 2015 before DRT-II, Chennai, which was allowed on 18.09.2017, directing recovery of Rs. 115,39,31,669.51 with interest. The Corporate Debtor's one-time

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## Facts

State Bank of India (SBI), the Financial Creditor, filed a petition under Section 95 of the Insolvency and Bankruptcy Code (IBC) against Mrs. J. Kamala, the Personal Guarantor, seeking to initiate the insolvency resolution process. The claim stems from a principal debt of INR 124,88,59,483.63, plus interest and penalties, related to credit facilities availed by M/s. JKS Constructions Private Limited, the Corporate Debtor. Mrs. Kamala had executed a deed of guarantee on 07.12.2009 and multiple supplemental deeds. The Corporate Debtor's account was classified as NPA on 28.10.2013. SBI and Bank of Maharashtra jointly pursued legal action, resulting in a DRT order on 18.09.2017, directing recovery of INR 115,39,31,669.51 with interest. A one-time settlement offer from the

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## Issues and analysis

### Issue 1: Whether the petition filed under Section 95 of the IBC is maintainable against the Personal …

**Ratio:** Section 128 of the Indian Contract Act, 1872 states that the liability of the surety is

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**Reasoning:** The Tribunal considered the IRP's report, which recommended the admission of the

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**Interpretation:** The legal principle establishes that the liability of a guarantor is linked to

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**Application:** In this case, Mrs. J. Kamala acted as a personal guarantor for the Corporate

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## Parties

- **Judges:** SANJIV…; Venkataraman…
- **Appellants:** State Bank of…
- **Respondents:** JKS Constructions…; J Kam…
- **Advocates:** Shri. V Bathri…

## Timeline

- **2009-12-07 — Deed of Gua…**: Mrs. J. Kamala executed…
- **2013-10-28 — Account Decla…**: The loan account of the Corporate Debtor…

## 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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