The Insolvency and Bankruptcy Code is not a shield for evading liabilities arising from fraudulent conduct, and petitions lacking full disclosure of material facts are subject to dismissal.

ORDER

Per Coram

1. The Personal Guarantors have filed these two Petitions, each offering personal guarantees for the same debt of the same Corporate Debtor. Given that the legal and factual issues in these cases are identical, they have been heard together, and a common order is being passed.

2. These Petitions number CP(IBC)/26/KOB/2024 and CP(IBC)/27/KOB/2025 have been filed under Section 94(1) of the Insolvency & Bankruptcy Code, 2016 , read with Rule 6(1) of the Insolvency and Bankruptcy (Application to (hereinafter ‘the Code’) Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019. The relief sought is to initiate an Insolvency Resolution Process (hereinafter referred to as the IR Process") against the Personal Guarantors of M/s. Tenny Jose Limited (Corporate Debtor) for the default amount of Rs. 73,77,18,785.56/- (Rupees Seventy-Three Crore Seventy-Seven Lakh Eighteen Thousand Seven Hundred Eighty-Five Rupees and Fifty-Six Paisa Only) in respect of credit facility availed from the various Banks.

3. The salient facts of the case are as follows:

i. The Petitioners are among the Personal Guarantors, promoted M/s. Tenny Jose Limited, a family-owned, closely held public company incorporated on 11.10.2011. The company operated in paper products, building materials, roofing structures, and steel, and qualifies as an MSME under the Micro, Small and Medium Enterprises Development Act, 2006. It availed working capital loans from the State Bank of India (SBI) and South Indian Bank (SIB), with facilities renewed annually. The Petitioners and their family provided personal guarantees and mortgaged their assets, while M/s Steel House Pvt. Ltd., another promoter-owned company, gave a corporate guarantee.

ii. It is stated that the financial troubles of the Corporate Debtor began in November 2018 after the Government of India imposed an anti-dumping duty on copier paper imports from ASEAN countries. Before this, the company had expanded its operations nationwide in partnership with Asia Pulp and Paper-Indonesia, committing significant capital based on strong sales in South India. The sudden duty disrupted imports and halted growth. The situation worsened during the COVID-19 pandemic, as paper demand fell sharply due to office and school closures. This led to halted imports, heavy detention and demurrage charges, and major losses, pushing the company into a severe financial crisis.

iii. The loan accounts of the Corporate Debtor were declared as NPA by SBI on 28.06.2021 and by SIB on 23.02.2021.

iv. An operational creditor of the Corporate Debtor, M/s Korea Trade Insurance Corporation, initiated proceedings under Section 9 of the Code to commence the Corporate Insolvency Resolution Process (CIRP) before this Tribunal. This Tribunal admitted the Corporate Debtor into CIRP on 21.12.2021 and subsequently ordered its dissolution on 31.10.2023.

4. On presentation of the Petitions, this Adjudicating Authority vide order dated 07.08.2024 appointed Mr. C J Davis, having Registration Number: IBBI/IPA-003/ICAI-N00343/2021- 2022/13660 as Resolution Professional, directing him to file a report under Section 99 of the Code.

5. The Resolution Professional submitted reports dated 17.08.2024 as IA(IBC)/394/KOB/2024 in CP(IBC)/26/KOB/2024 and IA(IBC)/395/KOB/2024 in CP(IBC)/27/KOB/2024, under Section 99 of the Code. These reports recommended the admission of the Company Petitions filed under Sect