TaxTMI 
TaxTMI 
2025 (12) TMI 1258
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.... modification by way of amendment in the Company Petition No.413 of 2022 filed under Section 95, has been allowed. The Personal Guarantor aggrieved by the order has come up in this appeal. 2. Brief facts of the case necessary to be noticed for deciding this appeal are: 2.1 The State Bank of India extended credit facilities to AA Estates Private Limited. Appellant along with other Personal Guarantors jointly executed Guarantee Agreement dated 18.02.2012. 2.2 The Corporate Debtor defaulted in payment of debt. The account of the Corporate Debtor declared NPA on 27.02.2015 on continued failure in maintaining the account. 2.3 A Notice under Section 13(2) of the SARFAESI Act was issued on 02.03.2015 to the Corporate Debtor and Guarantor for recalling total outstanding liability. The Personal Guarantor acknowledged the liability by letter dated 31.01.2018. 2.4 Corporate Debtor further issued a proposal for settlement on 05.02.2018. 2.5 A notice under Form B was issued by the State Bank of India to the Appellant on 11.02.2021 and Section 95 application was filed in January, 2022. 2.6 Resolution Professional was appointed by the Adjudicating Authority who was permitted ....
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.... Petition on 05.08.2025 based on the loan recall notice dated 05.04.2016, it will be clearly time barred which amendment could not be allowed. No reasons have been provided by the State Bank of India for amending the petition after three years. Amendment of the Company Petition takes away the valid defence of non-invocation of personal guarantee by the Appellant. It is well settled principle of law that by amendment no time barred debt can be permitted to be introduced. The amendment which changes the earlier case of the Bank could not be allowed. 5. Learned counsel for the State Bank of India refuting the submission of learned counsel for the Appellant submits that by amendment application, the State Bank of India has not changed its case. The application for amendment of date of default has to be made by the State Bank of India since contention was raised by the Appellant of non-service of Section 13(2) notice under SARFAESI Act when the matter was heard on 29.04.2025. Impugned order itself amply safeguards the Appellant's rights and Appellant has been allowed to file reply to the amended petition. Issue of limitation is to be determined during adjudication of the amended peti....
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....ty-Six Thousand Four Hundred Twenty- Three and Paise Seventy-Nine Only), along with interest at the rate of 15.25% per annum with monthly rests and penal inter est at the rate of 1% per annum on a simple interest basis, with effect from 01.04.2016, till the date of payment. The notice called upon the Corporate Debtor and the Respondent to clear the said dues within seven (7) days from the date of receipt of the notice. However, despite due receipt of the Recall Notice, neither the Corporate Debtor nor the Respondent repaid the amounts due to the Applicant. The Applicant craves leave to refer to and rely upon the documents annexed to the Petition and the Additional Affidavits filed by the Applicant in the captioned Company Petition, as and when required. 10. The Applicant states that the Corporate Debtor and the co-guarantors of the Respondent, in their capacity as Directors, from time to time acknowledged their liability to repay the debt including during the period from 2021 onwards. Such acknowledgments are binding on the Respondent in terms of the Guarantee Agreement executed by her as a Personal Guarantor. The Corporate Debtor acknowledged its liability in its audited ....
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....e, as argued by Mr. Shivshankar, the Adjudicating Authority was not precluded from considering the same. The documents were brought on record before any final decision was taken in the Petition Under Section 7 of IBC." 9. The above observations were made by the Hon'ble Supreme Court with regard to filing of document at any stage. The said is also true for filing application for amendment in pleadings. The Adjudicating Authority in the impugned order has relied on the judgment of this Tribunal in "Sanjeeb Ranjeet Das Vs. Punjab National Bank and Another, 2024 SCC Online NCLAT 887" which was also a case where amendment in the date of default was permitted in Section 95 application. 10. Learned counsel for the Appellant has relied on the judgment of Hon'ble Supreme Court in "Life Insurance Corporation of India Limited vs. Sanjeev Builders Private Limited & Anr., (2022) 16 SCC 1" wherein the Hon'ble Supreme Court laid down various principles with regard to Order 6 Rule 17 i.e. allowing amendment of the pleadings. In para 71 final conclusion have been given by the Hon'ble Supreme Court. Para 71.1 to 71.11 are detailed conclusion, which are as follows: "71. Our final concl....
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.... 71.8. Amendment may be justifiably allowed where it is intended to rectify the absence of material particulars in the plaint. 71.9. Delay in applying for amendment alone is not a ground to disallow the prayer. Where the aspect of delay is arguable, the prayer for amendment could be allowed and the issue of limitation framed separately for decision. 71.10. Where the amendment changes the nature of the suit or the cause of action, so as to set up an entirely new case, foreign to the case set up in the plaint, the amendment must be disallowed. Where, however, the amendment sought is only with respect to the relief in the plaint, and is predicated on facts which are already pleaded in the plaint, ordinarily the amendment is required to be allowed. 71.11. Where the amendment is sought before commencement of trial, the court is required to be liberal in its approach. The court is required to bear in mind the fact that the opposite party would have a chance to meet the case set up in amendment. As such, where the amendment does not result in irreparable prejudice to the opposite party, or divest the opposite party of an advantage which it had secured as a resul....
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....tor shall constitute invocation of guarantee and the Respondent shall have opportunity to explain their case on that basis. Further, the amendment in date of default has been upheld by Hon'ble NCLAT in Sanjeeb Das (Supra) and there is no dispute that additional documents can be accepted before conclusion of proceedings. Accordingly, we consider it appropriate to allow the applicant to carry out the proposed amendments as such amendment shall be necessary or effective and proper adjudication of the controversy between the parties in relation to occurrence of default. Needless to say, the applicant shall serve a copy of amended petition to the Respondent, who shall be at liberty to file their reply to the amended petition within two weeks after receipt of the amended petition." 13. As noted above, learned counsel for the Appellant has contended that when the application was heard on several occasion and Bank failed to bring material to prove service of notice under section 13(2), the amendment application has been filed. A reply has been filed by the Personal Guarantor in Section 95 application objecting to the amendment, which reply has been referred by the Adjudicating Authority....
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....roduced for the first time, there would have to be some explanation and secondly, the plaintiff would have to g show his bona fides, particularly because such claims by way of an amendment would have the effect of defeating the rights created in the defendant by the lapse of time. When we see the present facts, it is clear that no such attempt is made by the plaintiffs anywhere more particularly in the amendment application." 16. Judgment of Hon'ble Supreme Court in "Patasibai vs. Ratanlal, (1990) 2 SCC 42" and judgment of High Court of Madhya Pradesh, Division Bench in "Kanhaiyalal Vishwamberdayal Agarwal vs. Muktilal Rameshwardas Naredi, AIR 2007 MP 1 (DB)" are to the same effect. 17. It is further submitted that amendment could not be allowed where the amendment takes away a valid defence or has effect of withdrawing the admission. Present is a case where Appellant is not withdrawing its admission in respect of issuance of notice under section 13(2). Appellant's case is that subsequent to the said notice another loan recall notice was issued on 05.04.2016, which date is sought to be changed as date of default. By introducing the date of default as 05.04.2016 no defence is ....