TaxTMI 
TaxTMI 
2026 (4) TMI 1089
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....solvency) No. 874 of 2024 & I.A. No. 3152 of 2024 JUSTICE ASHOK BHUSHAN CHAIRPERSON AND INDEVAR PANDEY MEMBER (TECHNICAL) For the Appellant : Mr. Siddharth Sangal, Ms. Mrinalini Tandon, Ms. Richa Mishra, Mr. Kashish, Advocates. For Respondents : Mr. Shubhanshu Tiwari, Advocate. JUDGMENT ASHOK BHUSHAN, J. All these Appeal(s) have been filed by the State Bank of India ("SBI") challenging the order dated 07.03.2024 passed by National Company Law Tribunal, Ahmedabad (Court-III) dismissing application filed by the SBI under Section 95 of the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as the "IBC") against the Respondents to the Appeals - the Personal Guarantors of the Corporate Debtor ("CD") - M/s Yogiraj Ginning and Oil Industries Pvt. Ltd. 2. Separate Company Petitions were filed against each of the Respondent(s) in these Appeal(s), for example Company Appeal (AT) (Ins.) No.865 of 2024 has been filed against the order dated 07.03.2024 in CP(IB)No.236/NCLT/AHM/2022, which was filed by SBI against Mr. Anopsingh Kiritsinh Sarvaiya; similarly different Company Petitions under Section 95 were filed by SBI against other Personal Guarantors, who are Re....
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....h Sarvaiya. Similary, C.P.(IB) No.174/NCLT/AHM/2023 filed against Devendrasinh Ranjitsinh Jadeja; C.P.(IB) No.237/NCLT/AHM/2022 against Kuldipsinh Anopsinh Chudasma; C.P.(IB) No.171/NCLT/AHM/2023 against Aliben Shamlabhai Movaniya; C.P.(IB) No.42/NCLT/AHM/2023 against Lakhmaben Kimabhai Monaviya; C.P.(IB) No.169/NCLT/AHM/2023 against Shamlabhai Momaiyabhai Monaviya; C.P.(IB) No.173/NCLT/AHM/2023 against Kimabhai Momaiyabhai Monaviya; C.P.(IB) No.172/NCLT/AHM/2023 against Dhirajlal Girdharbhai Chaniyara; and C.P.(IB) No.170/NCLT/AHM/2023 against Ansuyaben Mansukhlal Chaniyara. (v) The Adjudicating Authority appointed RP in the application, directing him to submit a Report under Section 99. The RP submitted a Report recommending initiation of proceedings under Section 95. The Personal Guarantors in their objection claimed that revival letter dated 19.09.2017 has not been produced along with the application. It was pleaded that date of default according to NeSL was 30.06.2018 from which date, the application is filed beyond two years. The limitation for filing an application as per judgment of the Hon'ble Supreme Court in Suo Motu Writ Petition (Civil)....
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.... other Personal Guarantors, in separate orders, the same reasoning has been adopted by the Adjudicating Authority, i.e., the application is beyond limitation and there is no appropriate invocation of the personal guarantee. 4. We have heard learned Counsel appearing for the Appellant and learned Counsel appearing for the Respondents. 5. Learned Counsel for the Appellant challenging the order passed by the Adjudicating Authority submits that applications under Section 95 were filed on 31.03.2022 and date of default was mentioned in Section 95 application was 24.12.2019. The applications were well within the period of limitation. It is submitted that personal guarantee was invoked by letter dated 25.10.2019, which letter clearly invoked the personal guarantee and demanded payment within 60 days. The Demand Notice under Rule 7 of 2019 Rules was issued thereafter on 21.10.2021 as required by Rules and thereafter application under Section 95 was filed on 31.03.2022, which was well within time. Learned Counsel for the Appellant submitted that with respect to the limitation for filing an application under Section 95, this Tribunal specially with respect to extending the benefit of o....
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....nce, the period of limitation cannot be counted from the said date. The Adjudicating Authority has rightly observed that application is defective. Observation of Adjudicating Authority that if date of notice is considered, the date of default as per application is 24.12.2019, there is no invocation of guarantee. The Adjudicating Authority has rightly observed that the Applicant itself is not sure that when there was date of default. 7. We have considered the submissions of learned Counsel for the parties and have perused the records. 8. From the facts as noted above, there is no dispute that CD - M/s Yogiraj Ginning and Oil Industries Pvt. Ltd. was sanctioned credit facilities by the SBI. Personal guarantees were executed by the Personal Guarantors [the Respondent(s) herein]. The personal guarantee dated 24.03.2015 has been brought on record as Annexure A-3 in Company Appeal (AT) (Ins.) No.865 of 2024, which mentions name of 11 Personal Guarantors and the amount of guarantee was Rs. 19.65 crores and the CD was borrower. Clause-1 of the Guarantee Deed states as follows: "1. If at anytime default shall be made by the Borrower(s) in payment of the principal sum and / or....
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....ven by Adjudicating Authority for rejecting the application is that the application is filed beyond limitation. The said observations are made on the basis that the revival letter dated 19.09.2017, not filed along with the application, hence, the limitation cannot be counted from 19.09.2017. In Paragraph-10 of the impugned order (Company Appeal (AT) (Ins.) No.865 of 2024), following has been observed: "10. The revival letter as well as acknowledgement of service of notice was not filed along with application. No reason given for not filing the same. Those were filed later-on, which creates doubt of their genuineness. Hence, the application is not within the period of limitation without revival letter. However, it will be in the interest of justice to decide the matter on other aspects so as to avoid remand of matter." 11. The order of the Adjudicating Authority itself notices that although revival letter dated 19.09.2017 was not filed along with the application, but the said letter was subsequently filed. Filing or non-filing of revival letter dated 19.09.2017 has no relevance in the facts of the present case. We have extracted Part-III of Section 95 application, where ....
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....here the limitation would have expired in between 15.03.2020 & 28.02.2022, irrespective of actual balance period the persons shall have limitation period of 90 days from 01.03.2022 and so on. Thus, it is clear that when the limitation period expired during 15.03.2020 till 28.02.2022, the directions in Para-III will be applicable." 12. The view taken in Paragraph-18 of the impugned order by the Adjudicating Authority is that if the date of default is taken into consideration as 30.06.2018, the actual balance period of limitation remains is grater than 90 days from 01.03.2022 shall apply. The observations made in Paragraph-18 of the order are as follows: "18. The case in hand, the date of default mentioned is 30.06.2018 and the date of demand notice is 14.06.2019. When a limitation period is expired during the period between 15.03.2020 to 28.02.2022 the directions are specifically given in para-III of the order. The directions clearly give 90 days further period from 01.03.2022. It is also mentioned that in the event of actual balance period of limitation remains is greater than 90 days from 01.03.2022 in that case longer period shall apply. So if the date of default is t....
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....on 24.09.2018. 15. We have noticed above that in the application, the date of default mentioned as 24.12.2019 on the basis of notice under Section 13, sub-section (2) of the SARFAESI Act, 2002 dated 25.10.2019. Copy of the notice dated 25.10.2019 has been brought on the record as Annexure A-4. Both the notice dated 14.06.2019 and 25.10.2019 were issued under Section 13, sub-section (2) of the SARFAESI Act, 2002 have been brought on record. The SBI having relied on notice dated 25.10.2019, we need to notice contents of the said notice. The Adjudicating Authority has further observed that there is no invocation of guarantee after notice dated 14.06.2019 and 25.10.2019, hence the said issue also needs to be considered. The notice dated 25.10.2019 has been sent to the Personal Guarantors of the CD (Respondents herein) mentions the name of all the Personal Guarantors. Notice mentions that facilities granted has become irregular and account was classified as NPA from 27.09.2018. The names of Personal Guarantors are also mentioned in the notice. It is useful to notice Paragraphs 4 and 5 of the notice, which are as follows: "4. You have also acknowledged subsistence of the liab....
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....d incidental expenses, costs as stated above in terms of this notice u/s. 13(2) of the act within 60 days from the date of notice, the Bank will exercise all or any of the rights as detailed under Sub-Section (4) of Section 13 and under other applicable provisions of the SARFAESI Act." 17. The above statement in the notice clearly demands the payment from the Personal Guarantors. Paragraph-6 mentions "Therefore, the Bank hereby calls upon all of you to discharge in full your liabilities within 60 days". Thus, the notice dated 25.10.2019 is notice clearly invoking the personal guarantee of the CD and observation of the Adjudicating Authority that personal guarantee was not invoked after 14.06.2019, is incorrect and not according to the record. The Demand Notice under Rule 7 of 2019 Rules was issued on 21.10.2021, in which also the date when default occurred was mentioned as 24.12.2019. Along with the Demand Notice dated 21.10.2021, the recall notice dated 25.10.2019 issued by the Bank was also annexed. It is useful to notice Paragraph-2, Item No.14 of the Demand Notice, which reads as follows: "14. List of documents attached to this notice in order to prove the existence of....