# In the matter of UCO Bank vs. Rahul Gupta

> NCLT judgment dated 2025-01-08. Citation: TCN-2025-NCLT-00656. The case involves an application under Section 95(1) of the Insolvency and Bankruptcy Code,…

- **Court:** NCLT
- **Order date:** 8 Jan 2025
- **Citation:** TCN-2025-NCLT-00656
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/uco-bank-vs-rahul-gupta-0fb1e7a4

## Summary

### Background

The case involves an application under Section 95(1) of the Insolvency and Bankruptcy Code, 2016, read with Rule 7(2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019. UCO Bank, the financial creditor, filed the application against Rahul Gupta, the personal guarantor to a corporate debtor, seeking initiation of the Insolvency Resolution Process. The Resolution Professional (RP) was appointed and submitted a report. The NCLT Kolkata Bench is considering the maintainability of the application, given that no Corporate Insolvency Resolution Process (CIRP) has been initiated against the principal borrower, Haridra Vintrade Private Limited.

## Facts

UCO Bank extended credit facilities to M/s Haridra Vintrade Private Limited, which was sanctioned on July 15, 2022. M/s Haridra Vintrade Private Limited failed to repay the loan amount as per the repayment schedule, leading UCO Bank to classify the account as a Non-Performing Asset (NPA). Rahul Gupta executed a Deed of Guarantee on July 28, 2022, in favor of UCO Bank, guaranteeing the repayment of the loan. UCO Bank issued a Recall Notice to the company on March 31, 2023. UCO Bank also filed an application before the Debts Recovery Tribunal - 3, Kolkata [Case No. OA/373/2023], which is still pending. UCO Bank invoked the Personal Guarantee of Rahul Gupta via letters dated May 13, 2024, and June 04, 2024, but failed to realize its dues. A demand notice was issued to

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## Issues and analysis

### Issue 1: Whether proceedings against Personal Guarantor under Section 95 of the Code is maintainable even …

**Ratio:** The liability of the surety or guarantor is co-extensive with the principal debtor unless

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**Reasoning:** The court considered Section 179 of the IBC, which designates the Debt Recovery Tribunal

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**Interpretation:** The court interpreted Section 60(2) of the IBC to mean that if a CIRP is

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**Application:** In this case, no CIRP was initiated against the principal borrower, Haridra

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## Parties

- **Judges:** BIDISHA BA…; D. Ar…
- **Appellants:** UCO B…
- **Respondents:** HARIDRA VINTRADE…; Rahul G…

## Timeline

- **2022-07-15 — Sanction…**: UCO Bank extended credit facilities to M/s Haridra Vintrade Private Limited by Sanction…
- **2022-07-28 — Deed of Gua…**: The Deed of Guarantee was…

## 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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