# In the matter of The Karur Vysya Bank Ltd Vs. Pooja Malhotra, CP (IB)/335/ND/2022

> NCLT judgment dated 2022-08-04. Citation: TCN-2022-NCLT-01460. The Karur Vysya Bank Limited, as the creditor/applicant, filed an application under Section…

- **Court:** NCLT
- **Order date:** 4 Aug 2022
- **Citation:** TCN-2022-NCLT-01460
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/the-karur-vysya-bank-ltd-vs-pooja-malhotra-cp-4352b82f

## Summary

### Background

The Karur Vysya Bank Limited, as 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 Smt. Pooja Malhotra, the personal guarantor/debtor, who is the guarantor of M/s Xalta Food and Beverages Private Limited, the corporate debtor. The guarantee deed was executed on 04.05.2017 by Smt. Pooja Malhotra, guaranteeing the loan granted to M/s Xalta Food and Beverages Pvt. Ltd. The loan account of the corporate debtor became a Non-Performing Asset (NPA) on 30.12.2018.

## Facts

The Karur Vysya Bank Limited extended a loan to M/s Xalta Food and Beverages Private Limited, with Smt. Pooja Malhotra acting as the personal guarantor. A guarantee deed was executed on 04.05.2017. The loan account was classified as a Non-Performing Asset (NPA) on 30.12.2018. The total outstanding debt amounted to Rs. 14,91,62,709.79 as of 31.05.2021, plus interest. The applicant invoked the guarantee and issued a notice dated 13.03.2019. The applicant filed an application under Section 95(1) of the IBC, 2016, to initiate the Insolvency Resolution Process against the personal guarantor. The applicant served a notice to the personal guarantor via speed post, which was later served through newspaper publication on 30.12.2021. The applicant also served a copy of the

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## Issues and analysis

### Issue 1: Whether the application filed by Karur Vysya Bank Limited under Section 95(1) of the IBC, 2016, for …

**Ratio:** Section 95(1) of the IBC, 2016, allows a creditor to file an application for initiating

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**Reasoning:** The applicant, Karur Vysya Bank Limited, has claimed that the personal guarantor, Smt.

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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 has demonstrated that Smt. Pooja Malhotra is a personal guarantor

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## Parties

- **Judges:** SHRI. DHARMINDER…; SHRI. L. N.…
- **Appellants:** The Karur Vysya…
- **Respondents:** M/s Xalta Food…; Pooja Mal…

## Timeline

- **2017-04-05 — Guarantee Deed…**: The Guarantee Deed was executed and signed by the Respondent Smt. Pooja Malhotra…
- **2018-12-30 — Loan Account Be…**: 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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