Procedural compliance under Sections 95, 99, and 100 of the IBC is essential before admitting insolvency proceedings against personal guarantors.

JUDGMENT

(Hybrid Mode)

25.07.2024:

Oral Judgment : Justice Sharad Kumar Sharma, Member (Judicial):

1. The Prime question which engages consideration in these Company Appeals and calls for a reply by this Tribunal is as to ``whether the impugned judgments which are under challenge in these 4 Company Appeals satisfy the parameters required to be satisfied under Section 99 to be read with Section 100 of the I & B Code, 2016, for the purposes of initiation of Insolvency Resolution proceedings under Section 95 in light of the directives as issued by the Hon’ble Apex Court, in the matter where the vires of Sec. 95 was the subject matter of consideration’’.

2. Before dealing with the aforesaid issue as argued by the respective learned Counsels appearing for the parties, we feel it apt to precisely deal with the controversy which has been attempted to be argued by the learned Practising Company Secretary appearing for the Appellant, as against the impugned order, by virtue of which, Section 95 of the I & B Code, 2016, has been directed to be admitted and consequent to it, the IRP proceedings had been initiated.

3. In Company Appeal (AT) (CH) (INS) No. 169 / 2023, the challenge is given by the Appellant to the Impugned Judgment dated 28.04.2023, passed in the Company Petition (IB) No. 181 / 95 / HDB / 2022, Bank of Maharashtra V. Smt. Nukala Savithri & Anr., by the learned Adjudicating Authority, NCLT, Hyderabad. As a consequence of the Impugned Judgment, Section 95 proceedings has been admitted to be initiated as against the Appellant, i.e. the Personal Guarantor.

4. In the Company Appeal (AT) (CH) (INS) No. 171 / 2023, the challenge is given to the Impugned Order dated 28.04.2023 as passed in CP (IB) No. 183 / 95 / HDB / 2022, Bank of Maharashtra V. NNBV Venkateshwara Rao & Anr., passed by the learned Adjudicating Authority, consequently admitting the Appellant to face the IRP proceedings under Sec. 95 of the I & B Code, 2016.

5. The Company Appeal (AT) (CH) (INS) No. 238 / 2023, Shri. Manda Satyanarayana V. Bank of Maharashtra & 2 Ors., stood instituted before this Tribunal on 30.04.2023, wherein the Appellant has questioned the propriety of the Impugned Order dated 31.03.2023, which was passed by the learned Adjudicating Authority, NCLT, Hyderabad, in CP (IB) No. 179 / 95 / HDB / 2022 and as a consequence to the judgment impugned, the Appellant / Personal Guarantor was admitted to the IRP proceedings under Section 95 of I & B Code, 2016.

6. In Company Appeal (AT) (CH) (INS) No. 239 / 2023, Manda Venkata Mahalakshmi V. Bank of Maharashtra & 2 Ors., the Appellant has put a challenge to the Impugned Judgment dated 31.03.2023, as passed by the learned Adjudicating Authority of the National Company Law Tribunal at Hyderabad Bench in CP(IB) No.173 / 95 / HDB /2022, by virtue of which, the Personal Guarantor i.e. the Appellant herein was admitted into the IRP proceedings under Sec. 95 of the I & B Code, 2016.

7. All these Appeals are circumscribed by a common set of facts which are required to be considered to arrive at a conclusion as to whether the said facts justify admission of the said Personal Guarantors into IRP proceedings under Section 95 of the I & B Code, 2016.

8. Before we delve into these pleadings, we need to dwell upon the basic principles, as enunciated under the Statute, as to under what circumstances the proceedings under Section 95 could be initiated against the Personal Guarantors. For the aforesaid purpose, the key point will be the stage at which the Resolution Plan is submitted by the Resolution Professional, which will then be examined, by the learned Adju