# In the matter of The Karur Vysya Bank Ltd Vs. Mr. R K Sharma, CP (IB)/416/ND/2022

> NCLT judgment dated 2022-08-03. Citation: TCN-2022-NCLT-01482. The Karur Vysya Bank Limited filed an application under Section 95(1) r/w Rule 7(2) of the…

- **Court:** NCLT
- **Order date:** 3 Aug 2022
- **Citation:** TCN-2022-NCLT-01482
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/the-karur-vysya-bank-ltd-vs-mr-r-k-sharma-cp-5566f2f1

## Summary

### Background

The Karur Vysya Bank Limited 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 Mr. R.K. Sharma, the personal guarantor to M/s. Indian Technometal Company Limited (the Corporate Debtor). The guarantee deed was executed on 08.12.2012, guaranteeing the loan granted to the Corporate Debtor. The loan account of the Corporate Debtor became a Non-Performing Asset (NPA) on 12.06.2013.

## Facts

Karur Vysya Bank Limited (the 'Creditor/Applicant') 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 Mr. R.K. Sharma (Personal Guarantor/Debtor). Mr. R.K. Sharma is the guarantor of M/s. Indian Technometal Company Limited (the 'Corporate Debtor'). On 08.12.2012, the Guarantee Deed/Agreement was executed and signed by Mr. R K Sharma, guaranteeing the loan granted to M/s. Indian Technometal Company Limited. The loan account of the Corporate Debtor became Non-Performing Asset (NPA) on 12.06.2013. The total outstanding debt claimed is Rs. 59,95,47,848.96/- as per Recovery

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## Issues and analysis

### Issue 1: Whether the application filed by Karur Vysya Bank Limited under Section 95(1) r/w Rule 7(2) of the …

**Ratio:** Section 95(1) of the IBC, 2016 read with Rule 7(2) of the Insolvency and Bankruptcy

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**Reasoning:** The court considered the applicant's submissions, including the guarantee deed, the NPA

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**Interpretation:** Section 95(1) and Rule 7(2) are interpreted to allow creditors to initiate IRP

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**Application:** The ratio and reasoning apply to the facts because Karur Vysya Bank, as a

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## Parties

- **Judges:** DHARMINDER…; L. N. G…
- **Appellants:** The Karur Vysya…
- **Respondents:** Indian Technometal…; R.K. Sh…

## Timeline

- **2012-12-08 — Guarantee Deed…**: The Guarantee Deed/Agreement was…
- **2013-06-12 — Account Decla…**: The 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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