# In the matter of State Bank of India Vs. Shri Vijit Kumar Agarwal, CP (IB) No. 11/CB/2022

> NCLT judgment dated 2022-03-04. Citation: TCN-2022-NCLT-03897. The case pertains to an application filed by State Bank of India (SBI), the financial creditor,…

- **Court:** NCLT
- **Order date:** 4 Mar 2022
- **Citation:** TCN-2022-NCLT-03897
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/state-bank-of-india-vs-shri-vijit-kumar-agarwal-cp-02783612

## Summary

### Background

The case pertains to an application filed by State Bank of India (SBI), the financial creditor, under Section 95(1) of the Insolvency and Bankruptcy Code (IBC), 2016, read with Rule 7(2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtor) Rules, 2019, against Mr. Vijit Kumar Agarwal, the respondent and personal guarantor to Vandana Vidhyut Limited (VVL), the corporate debtor. The application seeks initiation of the Insolvency Resolution Process against the personal guarantor. CIRP proceedings had already been initiated against the Corporate Debtor vide order dated 26.04.2018 by Hon'ble NCLT Mumbai Bench.

## Facts

State Bank of India (SBI) filed an application under Section 95(1) of the Insolvency and Bankruptcy Code (IBC), 2016, against Mr. Vijit Kumar Agarwal, the personal guarantor to Vandana Vidhyut Limited (VVL), the corporate debtor. VVL had requested SBI for credit limits, which SBI sanctioned a Term Loan dated 09.04.2019 by the consortium of Bankers lead by Punjab National Bank. The credit facilities amounted to Rs. 340,30,24,040.34, secured by personal guarantees from four personal guarantors, including Mr. Agarwal, through a deed of Guarantee dated 27.10.2010. VVL subsequently sought enhancement of credit facilities. Mr. Agarwal executed personal guarantees on 09.04.2009, 28.03.2013, 31.03.2010 and 22.08.2014 in favor of SBI to secure the repayment of the principal

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## Issues and analysis

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

**Ratio:** Section 60(2) of the IBC, 2016 stipulates that when a Corporate Insolvency Resolution

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**Reasoning:** The court reasoned that since a Corporate Insolvency Resolution Process (CIRP) was

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**Interpretation:** Section 60(2) of the IBC is interpreted to mean that when a CIRP is ongoing

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**Application:** In this case, since the CIRP against VVL was pending before the NCLT Mumbai

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## Parties

- **Judges:** P. Moha…; Satya Ranjan…
- **Appellants:** State Bank of…
- **Respondents:** Vandana Vidhyut…; Vijit Kumar…
- **Advocates:** D. P. Sa…

## Timeline

- **2010-10-27 — Guarantee…**: Deed of Guarantee executed by four personal guarantors, including Mr. Vijit Kumar…
- **2018-04-26 — CIRP Init…**: Corporate Insolvency Resolution Process (CIRP) initiated against Vandana Vidhyut Limited…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 95(1) — Application by creditor to initiate insolvency…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-95)

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