# In the matter of State Bank of India vs. Sejal Himanshu Varia

> NCLT judgment dated 2025-03-11. Citation: TCN-2025-NCLT-00376. State Bank of India, acting as the Financial Creditor, filed a petition under Section 121 of…

- **Court:** NCLT
- **Order date:** 11 Mar 2025
- **Citation:** TCN-2025-NCLT-00376
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/state-bank-of-india-vs-sejal-himanshu-varia-13e862ea

## Summary

### Background

State Bank of India, acting as the Financial Creditor, filed a petition under Section 121 of the Insolvency and Bankruptcy Code, 2016, read with Rule 7(1) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Bankruptcy process for Personal Guarantors to Corporate Debtors) Rules, 2019, to initiate bankruptcy proceedings against Smt. Sejal Himanshu Varia, the Personal Guarantor of the Corporate Debtor, M/s. Varia Engineering Works Pvt. Ltd. The corporate debtor had taken loans from the applicant bank, and Smt. Varia had provided a personal guarantee for these loans. The financial debt was in the nature of Cash Credit, Term Loans, WCTL, and FITL facility. The total amount in default was Rs. 434,95,53,330.17/-. The Adjudicating Authority had

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## Facts

State Bank of India (SBI) is the Financial Creditor. Smt. Sejal Himanshu Varia is the Personal Guarantor to the Corporate Debtor, M/s. Varia Engineering Works Pvt. Ltd. The Corporate Debtor applied for a loan from SBI, which was approved on 15.12.2009. Smt. Varia was a director and the personal guarantor of the Corporate Debtor and executed the bank's standard loan documents. The total amount due is Rs. 434,95,53,330.17, including unapplied interest. The debt was due on 13.12.2018, and the default occurred on the same date. SBI issued a demand notice on 22.09.2021. SBI filed an application under Section 95 of the IBC against Smt. Varia, bearing CP(IB) No. 251 of 2021. The Tribunal declared an interim moratorium on 20.12.2021 and appointed an Interim Resolution

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## Issues and analysis

### Issue 1: Whether the Adjudicating Authority can admit the petition filed by the Financial Creditor under …

**Ratio:** Section 121 of the IBC, 2016, provides the legal basis for a creditor to file an

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**Reasoning:** The Adjudicating Authority considered the provisions of Section 121 of the IBC, 2016, and

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**Interpretation:** Section 121 of the IBC, 2016, is interpreted to allow creditors to initiate

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**Application:** In this case, the Financial Creditor, SBI, filed the petition under Section 121

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## Parties

- **Judges:** SHAMMI…; Velamur G Venkata…
- **Appellants:** State Bank of…
- **Respondents:** M/s. Varia…; Sejal Himanshu…

## Timeline

- **2009-12-15 — Loan App…**: Loan was approved for Corporate…
- **2018-12-13 — Debt Due…**: The debt was due as on 13.12.2018, and…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 121 — Application for bankruptcy](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-121)

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