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2024 Supreme(Online)(NCLT) 1001
NATIONAL COMPANY LAW TRIBUNAL
SMT. BIDISHA BANERJEE, SHRI D. ARVIND, JJ
Sajjan Kumar Dokania VS
IA(I.B.C) - 852/2024
For the Petitioner:BINAY KUMAR UPADHYAY
The failure of a Personal Guarantor to submit a repayment plan justifies a declaration of insolvency under the Insolvency and Bankruptcy Code, 2016.
Headnote:(A) Insolvency and Bankruptcy Code, 2016 - Sections 95(1), 97(5), 99(2), 102(1), 102(2), 105, 113, 115(2), 121 - Application for initiation of Insolvency Resolution Process against Personal Guarantor - The Tribunal admitted the application for insolvency resolution and noted the failure of the Personal Guarantor to submit a repayment plan, leading to the creditors' resolution to declare him as 'INSOLVENT'. (Paras 3, 21, 29)
(B) Personal Guarantor's Obligations - The Personal Guarantor is required to provide a repayment plan to the creditors, and failure to do so can result in a declaration of insolvency. (Paras 11, 21)
Facts of the case:
The Punjab National Bank filed an application for insolvency against the Personal Guarantor, Mr. Vivek Dugar, due to unpaid debts. The Resolution Professional was appointed, and despite multiple requests, no repayment plan was submitted by the Personal Guarantor. (Paras 3, 11)
Findings of Court:
The Tribunal allowed the application for bankruptcy due to the absence of a repayment plan from the Personal Guarantor, as per the provisions of the IBC. (Paras 29)
Issues: The main issue was whether the Personal Guarantor's failure to submit a repayment plan warranted a declaration of insolvency. (Paras 21)
Ratio Decidendi: The court held that the lack of a repayment plan from the Personal Guarantor justified the creditors' decision to declare him as 'INSOLVENT' under the IBC. (Paras 29)
Result: Application allowed and Mr. Vivek Dugar declared as 'INSOLVENT'.
Per: Bidisha Banerjee, Member (Judicial) 1. The Court Congregated through a hybrid mode. 2. Learned Counsel for the parties present.
3. The Punjab National Bank Limited as “Creditor” filed an application bearing C.P. (IB) No. 648/KB/2020 on 25.02.2020 under Section 95(1) of the Insolvency and Bankruptcy Code, 2016 read with rule 7(2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019 for initiation of Insolvency Resolution Process against Mr. Vivek Dugar the Personal Guarantor to M/s. Kohinoor Steel Private Limited the Corporate Debtor.
4. Mr. Sajjan Kumar Dokania, having IBBI Registration No-IBBI/IPA- 001/IP-P00966/2017-2018/11587 was appointed to act as Resolution Professional under Section 97(5) of the Code vide order dated 22/12/2021.
5. The Resolution Professional issued notice via email and hardcopy to Mr. Vivek Dugar to furnish necessary information/evidence to prove the repayment of the debt claimed as unpaid by Punjab National Bank in accordance with Section 99(2) of the IBC, 2016 and filed his report dated 01.01.2022 under Section 99 of IBC, 2016.
6. This Tribunal agreed to the recommendation made by the Resolution Professional and admitted the application vide its order dated 02.03.2022.
7. In compliance with Section 102(1) & (2) of Insolvency and Bankruptcy Code, 2016, a public Announcement was made by the Resolution IA(IB) No.852/KB/2024 In C.P.(IB) No. 648/KB/2020 Page 3 of 8 Professional on 04/03/2022 in Ajkaal (Bengali, W.B Edition) & in Financial Express (English, W.B edition), informing the public at large about the commencement of Personal Insolvency of Mr. Vivek Dugar and last date to submit the claims was 24.03.2022. Pursuant to the Public Announcement, RP received claims against the Personal Guarantor and after perusal of documents accepted the claims as follows:
8. On 17/04/2022, notices were sent to Mr. Vivek Dugar and all the members of the CoC proposing 1st Meeting of Committee of Creditors (CoC) on 19/04/2022 via video conferencing with agenda.
9. On 19/04/2022 at the 1st CoC meeting held via video conferencing, all the financial creditors were present through their representatives.
However, Mr. Vivek Dugar did not attend the meeting. He was sent minutes of the 1st CoC meeting via email on 21.04.2022.
10. The revised claim position after UBI gave its claim on 28.04.2022 was: IA(IB) No.852/KB/2024 In C.P.(IB) No. 648/KB/2020 Page 4 of 8
11. It is submitted that the debtor has failed to give a repayment plan in consultation with Resolution Professional which shall contain a proposal to the creditors for restricting of his debts or affairs in terms of Section 105 of IBC.
12. The Resolution Professional wrote several emails and letters to the “Personal Guarantor” requesting the repayment plan and filed affidavit for service of notices, reports, minutes of the committee of Creditors (CoC) meetings and orders.The revised claim position was shared with the Financial Creditors via email dated 17/06/2022.
13. On 20.06.2022 this Tribunal vide its order dated 26.06.2022 directed the RP to serve a copy of the Report (1st CoC meeting minutes) to Mr.
Vivek Dugar. Meanwhile, On 23/06/2022, claims were received from Bank of India and after obtaining necessary clarifications and IA(IB) No.852/KB/2024 In C.P.(IB) No. 648/KB/2020 Page 5 of 8 documents/information, claim of Rs.169.16 crores were accepted by the Resolution Professional on 04.08.2022. 14. On 27.06.2022, the Resolution Professional even requested the Ambassador Extraordinary & Plenipotentiary, Embassy of Nepal at New Delhi through email as well as hard copy by speed post for help for execution of order of Hon'ble NCLT, Kolkata and on 13.07.2022, the Ministry of Corporate affairs.
15. On 22.07.2022, claims were received from Indian Overseas Bank. 16. Progress reports were filed from time to time till 13.09.2022. In the meantime, due to stay by Hon'ble Sup
