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2021 (9) TMI 1242 - Tri - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - Financial Creditors/personal Guarantor - existence of debt and dispute or not - HELD THAT - The Guarantee of the Personal Guarantor was invoked by the bank by way of notice dated 24.08.2020 and a Demand Notice in Form B under rule 7(1) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process of Personal Guarantors to Corporate Debtor) Rules, 2019 was issued by the Financial Creditor, i.e., State Bank of India on 24.08.2020 to the Personal Guarantor in respect of the unpaid debt due from M/s. C C Constructions Limited. (Corporate Debtor) under rule 7(1) of the IBC, 2016. Counsel for the Applicant mentioned that there has been no response from the Respondent side to the demand notice - applicant in Part- III of Form-C has submitted that the Record of Default by Information Utility, M/s. National e-Governance Services Limited, recording of debt committed by the Corporate Debtor M/s. C C Constructions Limited. has also been annexed with the application. The application is complete and is admitted - moratorium declared. List the matter for further proceedings in the case on 22.09.2021.
Issues:
Application under Section 95 of the Insolvency and Bankruptcy Code, 2016 against a personal guarantor for outstanding debt of ?1138.73 crores due from the corporate debtor. Invocation of personal guarantee, appointment of resolution professional, and initiation of insolvency resolution process. Analysis: The judgment pertains to an application filed by the State Bank of India under Section 95 of the Insolvency and Bankruptcy Code, 2016 against a personal guarantor, Mr. Rajbir Singh, of the corporate debtor, 'M/s. C & C Constructions Limited', seeking to initiate the insolvency resolution process due to an outstanding debt of ?1138.73 crores as on 31.07.2020. The authorized person appointed by the financial creditor filed the application under rule 7 of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors), Rules, 2019. The counsel for the applicant highlighted that credit facilities were sanctioned to the corporate debtor on 16.04.2007, which were subsequently renewed and extended over time. The corporate debtor defaulted in repayment, leading to its admission under the Corporate Insolvency Resolution Process by an NCLT order dated 14.02.2019. A personal guarantee by Mr. Rajbir Singh in favor of SBICAP Trustee Company Limited was invoked by the bank through a demand notice dated 24.08.2020 under rule 7(1) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process of Personal Guarantors to Corporate Debtor) Rules, 2019. The application included the record of default by the corporate debtor as recorded by the Information Utility, M/s. National e-Governance Services Limited. Upon filing the application, an interim-moratorium commenced under Section 96(1)(a), staying legal actions or proceedings related to debts of the personal guarantor. The applicant proposed the appointment of Mr. Deepak Maini as the resolution professional, who was subsequently appointed by the authority under Section 97 of the IBC, 2016. The resolution professional, Mr. Deepak Maini, was directed to exercise powers under Section 99 of the Code and provide recommendations for the acceptance or rejection of the application within the stipulated time. The resolution professional was required to furnish a copy of the report to the applicant and comply with the regulations. The order directed the applicant and the registry to serve copies of the order, application, and documents to the appointed resolution professional for information and compliance, scheduling further proceedings for 22.09.2021.
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