Financial Creditor Seeks Insolvency Resolution Against Personal Guarantor The Financial Creditor, M/s. State Bank of India, filed an application under Section 95 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate ...
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Financial Creditor Seeks Insolvency Resolution Against Personal Guarantor
The Financial Creditor, M/s. State Bank of India, filed an application under Section 95 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate the Insolvency Resolution Process against the Personal Guarantor of 'M/s. Metenere Limited' for an outstanding debt of &8377; 1169,37,87,061. The Resolution Professional was appointed, and the interim-moratorium commenced, halting legal actions. The Resolution Professional is directed to assess the application and make recommendations within the specified time frame. The case is scheduled for further proceedings on 21.02.2022 to continue the Insolvency Resolution process against the Personal Guarantor.
Issues: Application under Section 95 of the Insolvency and Bankruptcy Code, 2016 against Personal Guarantor for Outstanding Debt.
Analysis: 1. The Financial Creditor, M/s. State Bank of India, filed an application under Section 95 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate the Insolvency Resolution Process against the Personal Guarantor of the Corporate Debtor, 'M/s. Metenere Limited', for an outstanding debt of &8377; 1169,37,87,061 as of 28.07.2017. The Resolution Professional, Mr. Vijender, was proposed by the Financial Creditor to file 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.
2. The CD, M/s. Metenere Limited, had availed various loan facilities from the applicant bank and its subsidiaries. The Respondent, Mr. Raman Gupta, stood as the personal guarantor for these facilities and executed several deeds of Personal Guarantee for both working capital and term loan facilities.
3. Despite repeated reminders and follow-ups, the CD and the Respondent failed to maintain financial discipline, leading to defaults. The account of CD was declared as Non-Performing Asset (NPA) on 28.07.2017. An application regarding the Corporate Debtor was admitted under Corporate Insolvency Resolution Process by NCLT, New Delhi, in 2020.
4. A Demand Notice was issued to the Personal Guarantor in respect of the unpaid debt due from M/s. Metenere Limited. The total debt from the personal guarantor, including interest, amounted to &8377; 1169,37,87,061 as of 17.05.2021.
5. The interim-moratorium commenced upon filing the application, prohibiting any legal action or proceeding in respect of any debt of the personal guarantor. The Applicant proposed Mr. Vijender Sharma as the Resolution Professional, who was appointed subject to regulations of the IBBI.
6. The Resolution Professional is directed to exercise all powers under the Code and make recommendations for the acceptance or rejection of the application within the stipulated time. The Applicant and the Registry are instructed to serve the order and documents on the Resolution Professional for compliance.
7. The matter is listed for further proceedings on 21.02.2022, maintaining the legal process for Insolvency Resolution against the Personal Guarantor in this case.
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