# In the matter of State Bank of India vs. Ratneshwar Kumar Maheshwari

> NCLT judgment dated 2023-11-30. Citation: TCN-2023-NCLT-00514. The State Bank of India ('Creditor'/'Applicant') filed an application to initiate the…

- **Court:** NCLT
- **Order date:** 30 Nov 2023
- **Citation:** TCN-2023-NCLT-00514
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/state-bank-of-india-vs-ratneshwar-kumar-maheshwari-16b358f4

## Summary

### Background

The State Bank of India ('Creditor'/'Applicant') filed an application to initiate the Insolvency Resolution Process against Shri Ratneshwar Kumar Maheshwari ('Personal Guarantor'/'Respondent'). The application was filed through Shri Satyendra P. Khorania, the Insolvency Resolution Professional ('IRP'), under Section 95 of the Insolvency and Bankruptcy Code, 2016 ('IBC'/'Code') 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. The Personal Guarantor had guaranteed loans availed by M/s Suzuki Textiles Ltd ('Corporate Debtor').

## Facts

State Bank of India filed an application to initiate Insolvency Resolution Process against Shri Ratneshwar Kumar Maheshwari, the Personal Guarantor, under Section 95 of IBC. The Personal Guarantor had executed a personal guarantee to secure the repayment of financial assistance availed by M/s Suzuki Textiles Ltd, the Corporate Debtor. The Corporate Debtor defaulted in repayment, leading to the invocation of the personal guarantee. The Corporate Debtor's account was declared NPA on 02.06.2017. A legal notice was served on 28.11.2019 upon the Corporate Debtor and Guarantors to disburse its debt of Rs. 62.18 Crores due as on 31.03.2019. The Creditor also preferred an Original Application 517/2020 against the Corporate Debtor and its guarantors before the Debt Recovery

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## Issues and analysis

### Issue 1: Whether the application to initiate the Insolvency Resolution Process against the Personal …

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

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**Reasoning:** The court observed that the Personal Guarantor had defaulted in payment of the dues

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**Interpretation:** Section 95 provides a mechanism for creditors to recover their dues from

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**Application:** The court found that the application was maintainable as the Personal Guarantor

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## Parties

- **Judges:** Deep Chandr…; RAJEEV ME…
- **Appellants:** State Bank of…
- **Respondents:** M/s Suzuki…; Ratneshwar Kumar…

## Timeline

- **2017-06-02 — NPA Decla…**: The account of the Corporate…
- **2019-07-30 — SARFAESI…**: Creditor issued notice under…

## 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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