# In the matter of State Bank of India Vs. Mr. N Prappanna Kumar, IBA/717/2020

> NCLT judgment dated 2022-03-11. Citation: TCN-2022-NCLT-03781. The case involves an application filed by State Bank of India (SBI) under Section 95(1) of the…

- **Court:** NCLT
- **Order date:** 11 Mar 2022
- **Citation:** TCN-2022-NCLT-03781
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/state-bank-of-india-vs-mr-n-prappanna-kumar-iba7172020-a20ff582

## Summary

### Background

The case involves an application filed by State Bank of India (SBI) under Section 95(1) of the Insolvency and Bankruptcy Code, 2016 against Mr. N Prapanna Kumar, the personal guarantor of M/s. Nathella Sampath Jewelry Private Limited, which is undergoing liquidation. The application seeks to initiate insolvency resolution process against the personal guarantor.

## Facts

State Bank of India (SBI) filed an application under Section 95(1) of the Insolvency and Bankruptcy Code, 2016 against Mr. N Prapanna Kumar, who is the personal guarantor for M/s. Nathella Sampath Jewelry Private Limited. Nathella Sampath Jewelry Private Limited is undergoing liquidation, with a common order passed on 2020-01-03. The date of default is stated as 2018-02-04. A demand notice was issued to the Personal Guarantor on 2020-08-28. The application seeks to initiate the insolvency resolution process against the personal guarantor. The Hon'ble NCLAT has held that once an application under Section 95 of IBC, 2016 is filed, the Adjudicating Authority must act on it.

## Issues and analysis

### Issue 1: Whether the application filed by State Bank of India under Section 95(1) of the Insolvency and …

**Ratio:** Section 95(1) of the Insolvency and Bankruptcy Code, 2016 allows a creditor to file an

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**Reasoning:** The Hon'ble NCLAT has held that once an application under Section 95 of IBC, 2016 is

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**Interpretation:** Section 95(1) provides a mechanism for creditors to recover debts from personal

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**Application:** SBI's application under Section 95(1) is maintainable as Mr. N Prapanna Kumar

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## Parties

- **Judges:** S. Ramath…; Anil Ku…
- **Respondents:** Nathella Sampath…; N Prapanna…

## Timeline

- **2020-01-03 — Liquidation…**: A common order was passed for the liquidation of…
- **2018-02-04 — Date of D…**: The date of default as…

## 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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