2021 (3) TMI 1259 - Tri - Insolvency and Bankruptcy

Appointment of Resolution Professional - Initiation of personal insolvency against the Personal Guarantor of the Corporate Debtor by Resolution Professional - Section 95 of I B Code - HELD THAT - The Bench, after hearing the Petitioner, notes that the Corporate Guarantor has not filed any submissions and on the date of hearing there was no representation from the side of the Respondent, i.e., the Personal Guarantor. Based on the submissions made by the Applicant and the documents produced and placed on record before this Bench, the Bench has no doubt in its mind that there is a default on the part of the Personal Guarantor by not fulfilling the debt owed to the Corporate Debtor, i.e., Pratibha Industries Limited as per the Deed of Guarantee entered between the parties through the Deed of Guarantee dated 10.03.2017 - This Bench Allows the Application filed by Mr. Ram Ratan Kanungo, Insolvency Resolution Professional on behalf of State Bank of India, the Financial Creditor, under Section 95 of the Insolvency Bankruptcy Code, 2016 read with Rule 7 of the IBC Rules 2019 against Mr. Ravi Ajit Kulkarni, the Personal Guarantor of the Corporate Debtor, M/s. Pratibha Industries Limited in CP No. 1192/2020. The Interim Moratorium as per Section 96(1) of the Code has commenced from the date of filing of Application by the Financial Creditor, i.e.,25.01.2021. The Bench notes that the appointment of Resolution Professional under Section 97 of the Code is critical and essential not only for the Applicant but also to safeguard the assets of the Personal Guarantor in terms of the provisions of the Code. Since the present Petition has been filed through the Resolution Professional, Mr. Ram Ratan Kanoongo, bearing Registration No. IBBI/IPA-001/IP-P00070/2017-18/10156, this Bench confirms the appointment of the Resolution Professional in the matter. In this matter, the Resolution Professional, Shri Ram Ratan Kanoongo, shall exercise all the powers as enumerated under Section 99 of the Code read with Rules made there under - List the matter for further proceedings in the case on 15.04.2021.

Summary

Issues involved:
1. Filing of petition under Section 95 of the I&B Code against a personal guarantor.
2. Default in fulfilling debt obligations by the personal guarantor.
3. Commencement of interim moratorium under Section 96(1) of the Code.
4. Appointment and powers of the Resolution Professional under Sections 97 and 99 of the Code.

Analysis:
1. The petition was filed under Section 95 of the I&B Code against a personal guarantor, Mr. Ravi Ajit Kulkarni, by the Resolution Professional appointed by the State Bank of India, the Financial Creditor, to initiate personal insolvency proceedings. The Resolution Professional was authorized by the State Bank of India, and necessary documents, including the consent form and registration certificate, were annexed with the petition.

2. The petitioner demonstrated that the personal guarantor had defaulted on debt obligations to the Corporate Debtor, Pratibha Industries Limited, as evidenced by a Personal Guarantee Invocation Notice and a Demand Notice issued by the State Bank of India. Despite serving the demand notice and filing the petition in prescribed Form 'C', the personal guarantor did not respond, leading to the confirmation of default by the Bench.

3. The Bench allowed the application, initiating the interim moratorium under Section 96(1) of the Code from the date of filing the application. This moratorium stays any legal actions or proceedings related to the debt and prevents creditors from initiating legal actions during this period, as specified under Section 96(3) with exceptions notified by the Central Government.

4. The appointment of the Resolution Professional under Section 97 was deemed critical to safeguard the assets of the personal guarantor. The Resolution Professional, Mr. Ram Ratan Kanoongo, was directed to exercise powers under Section 99 and provide recommendations for acceptance or rejection of the application within the stipulated time. Additionally, the Resolution Professional was instructed to share the report with the Creditor promptly.

In conclusion, the Tribunal confirmed the appointment of the Resolution Professional and scheduled further proceedings for 15.04.2021 to progress with the case in accordance with the provisions of the Insolvency & Bankruptcy Code, 2016.