# In the matter of The Karur Vysya Bank Ltd Vs. Homi, CP (IB)/332/ND/2022

> NCLT judgment dated 2022-08-04. Citation: TCN-2022-NCLT-01459. The Karur Vysya Bank Ltd. filed an application under Section 95(1) r/w Rule 7(2) of the…

- **Court:** NCLT
- **Order date:** 4 Aug 2022
- **Citation:** TCN-2022-NCLT-01459
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/the-karur-vysya-bank-ltd-vs-homi-cp-9a74cd8e

## Summary

### Background

The Karur Vysya Bank Ltd. filed an application under Section 95(1) r/w Rule 7(2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for IRP for Personal Guarantors to Corporate Debtor) Rules, 2019, to initiate the Insolvency Resolution Process against Smt. HOMI, the Personal Guarantor/Debtor of M/s. Xalta Food and Beverages Private Limited, the Corporate Debtor. The applicant claims that the Corporate Debtor's loan account became Non-Performing Asset (NPA) on 30.12.2018 and that the applicant has claimed a total debt of Rs.14,91,62,709.79/-.

## Facts

Karur Vysya Bank Ltd. filed an application against Smt. HOMI, the personal guarantor of M/s. Xalta Food and Beverages Private Limited. The application was filed under Section 95(1) of the IBC, seeking to initiate the Insolvency Resolution Process. A Guarantee Deed was executed and signed by Smt. Homi on 04.05.2017, guaranteeing the loan granted to M/s Xalta Food and Beverages Pvt. Ltd. under the Common Loan Agreement dated 04.05.2017. The loan account of the Corporate Debtor became Non-Performing Asset (NPA) on 30.12.2018. The applicant claimed a total debt of Rs.14,91,62,709.79/-. The applicant invoked the guarantee via notice dated 13.03.2019. A CIR process had already been initiated against the Corporate Debtor via order dated 25.07.2018. The applicant sent a notice

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## Issues and analysis

### Issue 1: Whether the application filed by Karur Vysya Bank Ltd. under Section 95(1) of the IBC for …

**Ratio:** Section 95(1) of the IBC allows a creditor to initiate insolvency resolution process

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**Reasoning:** The Adjudicating Authority considered the documents submitted by the applicant, including

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

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**Application:** The applicant, Karur Vysya Bank, demonstrated that Smt. HOMI was a personal

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## Parties

- **Judges:** SHRI. DHARMINDER…; Shri. L. N.…
- **Appellants:** The Karur Vysya…
- **Respondents:** Xalta Food &…; HOMI…

## Timeline

- **2017-05-04 — Guarantee Deed…**: Guarantee Deed was executed and signed by Smt. Homi guaranteeing the loan granted to M/s…
- **2018-12-30 — NPA Decla…**: Loan account of the Corporate Debtor…

## 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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