# In the matter of State Bank of India Vs. Shyam Bihari Goyal, CP (IB)-473/ND/2022

> NCLT judgment dated 2022-08-24. Citation: TCN-2022-NCLT-01292. The State Bank of India, as the financial creditor, filed an application under Section 95 of…

- **Court:** NCLT
- **Order date:** 24 Aug 2022
- **Citation:** TCN-2022-NCLT-01292
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/state-bank-of-india-vs-shyam-bihari-goyal-cp-0216f534

## Summary

### Background

The State Bank of India, as the financial creditor, filed an application under Section 95 of the Insolvency and Bankruptcy Code, 2016, read with Rule 7 of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtor) Rules, 2019, to initiate the Insolvency Resolution Process against Mr. Shyam Bihari Goyal, the personal guarantor to the corporate debtor, M/s. Kay Em Copper Pvt. Ltd. The application was filed due to the corporate debtor's failure to repay the disbursed debt, leading to its classification as a Non-Performing Asset (NPA). The financial creditor had issued a notice under Section 13(2) of the SARFAESI Act, 2002, demanding repayment, but the default continued.

## Facts

The State Bank of India (SBI) filed an application under Section 95 of the Insolvency and Bankruptcy Code (IBC), 2016, to initiate the Insolvency Resolution Process (IRP) against Mr. Shyam Bihari Goyal, the personal guarantor to M/s. Kay Em Copper Pvt. Ltd. (Corporate Debtor). SBI had sanctioned and disbursed various loans to the Corporate Debtor, for which Mr. Goyal acted as a guarantor. The Corporate Debtor defaulted on repayments, leading to the loan account being classified as a Non-Performing Asset (NPA) on 2019-02-12. SBI issued a notice under Section 13(2) of the SARFAESI Act, 2002, demanding repayment. The total debt payable by the Personal Guarantor as of 2022-05-27 was Rs 27,30,07,320. A demand notice under Rule 7(1) of the Insolvency and Bankruptcy

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## Issues and analysis

### Issue 1: Whether the application for initiating the Insolvency Resolution Process against the personal …

**Ratio:** Section 95 of the IBC, read with Rule 7 of the Insolvency and Bankruptcy (Application to

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**Reasoning:** The Tribunal considered the documents and arguments presented by the financial creditor,

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**Interpretation:** The interpretation of Section 95 and Rule 7 involves ensuring that the

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**Application:** In this case, the Tribunal found that the financial creditor had met all the

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## Parties

- **Judges:** P.S.N. P…; RAHUL BHA…
- **Appellants:** State Bank of…
- **Respondents:** Kay Em Copper…; SHYAM BIHAR…
- **Advocates:** Abhishek…; Vishal Hi…; +1 more

## Timeline

- **2011-10-28 — Incorporation of…**: M/s. Kay Em Copper Pvt.…
- **2019-02-12 — NPA Classif…**: 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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