# In the matter of Vijaygroup Realty LLP I.A. 461-2022 in C.P. 4359-I&B-MB-2019

> NCLT judgment dated 2022-12-16. Citation: TCN-2022-NCLT-00123. YES Bank Limited filed an Interlocutory Application (I.A. No. 461 of 2022) challenging the…

- **Court:** NCLT
- **Order date:** 16 Dec 2022
- **Citation:** TCN-2022-NCLT-00123
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/vijaygroup-realty-llp-ia-461-2022-in-cp-4359-ib-mb-2019-04953033

## Summary

### Background

YES Bank Limited filed an Interlocutory Application (I.A. No. 461 of 2022) challenging the Resolution Professional's (RP) rejection of their claim. The claim, dated 2021-10-11, was for ₹420,16,000,000 due and payable on 2021-10-07. YES Bank was not included in the Committee of Creditors (CoC). The RP opposed the application, arguing that the claim was based on an uninvoked bank guarantee and the principal borrower's account was a standard account. The RP sought clarification from YES Bank regarding whether the corporate guarantee dated 2017-10-07 given by the Corporate Debtor was invoked before the CIRP commencement date and whether Vijay Suraksha Realty LLP, the principal borrower, had defaulted in repayment of its loan. YES Bank responded that Vijay Suraksha Realty

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## Facts

YES Bank Limited filed a claim for ₹420,16,000,000 based on a corporate guarantee provided by Vijay Group Realty LLP. The Resolution Professional (RP) rejected the claim because the corporate guarantee had not been invoked. The RP sought clarification from YES Bank regarding the invocation of the guarantee and default by the principal borrower, Vijay Suraksha Realty LLP. YES Bank confirmed that the guarantee was not invoked and the borrower had not defaulted. The RP relied on a NCLAT judgment stating that an uninvoked corporate guarantee cannot be considered a claim under the Insolvency and Bankruptcy Code, 2016. YES Bank argued that the maturity of claim, default, or invocation of guarantee has no nexus with filing of claim pursuant to public announcement. The court

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## Issues and analysis

### Issue 1: Whether the action of RP in rejection of the claim of the petitioner basing on an uninvoked bank …

**Ratio:** An uninvoked corporate guarantee cannot be considered a claim as per the provisions of

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**Reasoning:** The court reasoned that the RP's decision to reject the claim was based on the fact that

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**Interpretation:** The legal issue revolves around the interpretation of the Insolvency and

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**Application:** In this specific case, the corporate guarantee provided by Vijay Group Realty

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## Parties

- **Judges:** H.V. Subb…; ANURADHA SANJAY…
- **Appellants:** Yes Bank L…
- **Respondents:** Vijay Group…; Anish G…
- **Advocates:** Shyam Ka…; Nausher…

## Timeline

- **2017-10-07 — Corporate Guara…**: Date of the corporate guarantee…
- **2021-10-07 — Claim Due…**: Date on which the amount of…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(5) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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