# In the matter of Ushdev Engitech Limited

> NCLT judgment dated 2025-04-29. Citation: TCN-2025-NCLT-00153. This case involves an application (IA/4194/2024) filed in C.P. (I.B) No. 119/MB/2021 before the…

- **Court:** NCLT
- **Order date:** 29 Apr 2025
- **Citation:** TCN-2025-NCLT-00153
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/ushdev-engitech-limited-833d8d49

## Summary

### Background

This case involves an application (IA/4194/2024) filed in C.P. (I.B) No. 119/MB/2021 before the National Company Law Tribunal (NCLT), Mumbai Bench, concerning the interpretation of a corporate guarantee. Seeta Neeraj Shah, a suspended director of Ushdev Engitech Limited (UEL), which is undergoing Corporate Insolvency Resolution Process (CIRP), filed the application. The core dispute revolves around whether the liability of the applicant guarantor under a corporate guarantee is capped at Rs. 25 Crores, as per Clause 33 of the guarantee, or whether it extends to default interest exceeding this cap. ICICI Bank, the financial creditor, claims that the liability includes default interest, while the applicant argues that Clause 33 imposes a strict limit. The Resolution

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## Facts

Ushdev Engitech Limited (UEL) is undergoing Corporate Insolvency Resolution Process (CIRP) following an admission order dated 2023-04-26. ICICI Bank is the Financial Creditor of the Corporate Debtor. The Corporate Debtor executed a Corporate Guarantee dated 2016-08-10 in favor of ICICI Bank to secure the repayment of certain loan facilities availed by its parent company, Ushdev International Limited (UIL). Clause 33 of the Corporate Guarantee provides that the liability of Ushdev Engitech Limited under the Corporate Guarantee is capped at Rs. 25 Crores. Ushdev International Limited (UIL) defaulted, and ICICI Bank invoked the Corporate Guarantee on 2017-10-16, demanding payment of Rs. 25 Crores from UEL. ICICI Bank filed a revised claim form with the Resolution

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## Issues and analysis

### Issue 1: Whether the liability of the Applicant Guarantor under the Corporate Guarantee would not exceed the …

**Ratio:** The liability of a guarantor is determined by the terms of the contract. A non-obstante

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**Reasoning:** The NCLT reasoned that Clause 33 of the Corporate Guarantee clearly spells out that

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**Interpretation:** The interpretation of a contract should be based on the plain and simple

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**Application:** In this case, the NCLT applied the principle that the Guarantor's liability

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## Parties

- **Judges:** Sushil Mahadeorao…; Charanjeet Singh…
- **Appellants:** Seeta Neera…
- **Respondents:** Ushdev Engitech…; ICICI Ban…

## Timeline

- **2016-08-10 — Corporate Guarantee…**: The Corporate Debtor executed a Corporate Guarantee in favor of ICICI Bank to secure the…
- **2017-10-16 — Guarantee Inv…**: ICICI Bank invoked the Corporate Guarantee,…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 12 — Time-limit for completion of insolvency resolution…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-12)

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