# In the matter of The Karur Vysya Bank Ltd Vs. Vaibhav Singhal, CP (IB)/417/ND/2022

> NCLT judgment dated 2022-08-03. Citation: TCN-2022-NCLT-01490. 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-01490
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/the-karur-vysya-bank-ltd-vs-vaibhav-singhal-cp-befd73b7

## 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. Vaibhav Singhal, the personal guarantor for M/s. Savemax Wholesale Club Private Limited and M/s. Bishan Saroop Ram Kishan Agro Private Limited, the corporate debtors. The corporate debtors' loan accounts became Non-Performing Assets (NPA) on 30.05.2018 and 09.03.2018, respectively.

## Facts

Karur Vysya Bank Limited filed an application against Mr. Vaibhav Singhal, who acted as the personal guarantor for loan facilities extended to two corporate debtors: M/s. Savemax Wholesale Club Private Limited and M/s. Bishan Saroop Ram Kishan Agro Private Limited. The guarantee deeds were executed by Mr. Vaibhav Singhal on 30.04.2015 and 08.01.2016. The loan accounts of the corporate debtors were declared as Non-Performing Assets (NPA) on 30.05.2018 and 09.03.2018, respectively. The bank claimed a total debt of Rs. 47,70,31,121.40/- from M/s. Savemax Wholesale Club Private Limited and Rs.33,20,64,082.36/- from M/s. Bishan Saroop Ram Kishan Private Limited. The bank invoked the guarantees and issued notices under Section 13(2) of the SARFAESI Act, 2002. Demand notices

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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 applicant, Karur Vysya Bank Limited, has filed the application against Mr. Vaibhav

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**Interpretation:** Section 95(1) provides the legal basis for creditors to initiate insolvency

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**Application:** The ratio and reasoning apply to the facts of the case because Karur Vysya Bank

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## Parties

- **Judges:** SHRI. DHARMINDER…; SHRI. L. N.…
- **Appellants:** The Karur Vysya…
- **Respondents:** Savemax Wholesale…; Vaibhav S…

## Timeline

- **2015-04-30 — Execution of Guarantee…**: Guarantee Deeds/Agreements were executed…
- **2016-01-08 — Execution of Guarantee…**: Guarantee Deeds/Agreements were executed…

## 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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