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2025 Supreme(Online)(NCLT) 5983
NATIONAL COMPANY LAW TRIBUNAL
Brajendra Mani Tripathi, J, Man Mohan Gupta, T
Small Industries Development Bank of India – Appellant
Versus
Krishnakant Bagree – Respondent
CP(IB)/62(MP)2023
For the Appellants/Petitioners: Ms. Bharti Nawlani
For the Respondents: Mr. G. Adhin
The limitation period for filing an application under insolvency law begins at default and is crucial for enforcing personal guarantees.
Headnote:This judgment pertains to an application filed under Section 95 of the Insolvency and Bankruptcy Code, 2016, initiated by Small Industries Development Bank of India against Krishnakant Bagree, alleging default on a personal guarantee. The Tribunal reviewed claims of limitation based on the date of default and previous demands made on the guarantor. Key findings concluded that the application was time-barred as the demand notice was made in 2015, while the application was filed in 2023, exceeding the limitation period set forth in Article 137 of the Limitation Act, 1963. The court found no valid acknowledgment under Section 18 of the Limitation Act to renew the limitation period due to the timing of OTS proposals relevant to the case. The petition was dismissed on the grounds of being barred by limitation.
| Table of Content |
|---|
| 1. application filed under ibc against personal guarantor. (Para 1 , 2 , 3 , 4 , 5 , 6) |
| 2. respondent's arguments against the application. (Para 9 , 10 , 11 , 12 , 14 , 15) |
| 3. court's observations and analysis on limitation issues. (Para 16 , 17 , 18 , 19 , 20 , 21 , 22 , 23) |
| 4. final decision on application based on limitation. (Para 24) |
ORDER
Delivered on 29/10/2025 The case is fixed for pronouncement of the order. The order is pronounced in open Court vide separate sheet.
JUDGEMENT
1. The Present Application is filed under Section 95 of the Insolvency and Bankruptcy Code, 2016 (Herein referred to as “IBC, 2016”) r/w. Rule 7(2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantor to Corporate debtor) Rules, 2019 by Small Industries Development Bank of India (“Financial Creditor”) for the purpose of initiating Personal Insolvency Resolution Process against Sh. Krishnakant Bagree, Personal Guarantor to Bagree Alloys Limited for default of an amount of Rs. 13,55,61,322.44/-.
2. The Applicant/Financial Creditor herein submits that at the request of the Corporate Debtor, the Applicant/Financial Creditor had sanctioned credit facilities to the Corporate Debtor for an amount of Rs.440 Lakhs. As against the said facilities other security documents were executed subject to the terms and conditions thereto. Pursuant to which, the Personal Guarantor viz. Respondent herein was one of the executors of the Personal Guarantee Deed dated 22.12.2008, 03.11.2009 and 22.06.2010 (Anx. 6 colly) thereby guaranteeing the debt.
3. On account of Corporate Debtor’s successive defaults in re payment of the outstanding amount disbursed under the afore- stated facility, consequently, the Financial Creditor classified the loan account of corporate debtor as Non-Performing Assets (NPA) on 08.06.2013.
4. The Applicant submits that on 12.03.2014, the Applicant issued a notice under Section 13(2) of the SARFAESI Act (Anx. 7) to the Corporate Debtor and all the Guarantors of Corporate Debtor (including the Personal Guarantor herein) seeking forthwith repayment of the outstanding amount along with the interest and accrued charges.
5. The Applicant respectfully submits that a Notice dated 25.08.2015 (Anx. 8) was issued to the Personal Guarantor invoking the personal guarantee and demanding payment of the outstanding dues. Thereafter, the Applicant issued Demand Notice dated 20.08.2022 (Anx. 9) to the Personal Guarantor in Form B, in accordance with Rule 7(1) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019. However, the debtor has not paid dues to the applicant despite the notices.
6. It was submitted on 16.03.2023 the applicant received One- time settlement letter from the Corporate Debtor (Anx.10) whereby the Corporate Debtor acknowledges the debt and extends the period of limitation for filing the present application.
7. This Tribunal Vide order dated 22.02.2024 appointed the resolution professional Ms. Megha Jain having registration No. IBBI/IPA-001/IP-P-02466/2021-2022/ 13857 to submit a report u/s 99 of the IBC 2016.
8. The Resolution Professional has submitted his report under Section 99 of the Insolvency and Bankruptcy Code, 2016 on 20.04.2024, recommending admission of the application filed under Section 95 of the Code. In the said report, the Resolution Professional has stated that no evidence of repayment of the debt by the Personal Guarantor was received. Furthermore, the Resolution Professional, vide letter dated 29.2.2024 sent through speed post, intimating the Personal Guarantor about his appointment and requested submission of proof of payment of the outstanding debt. However, it got returned with the remark “addressee left without instructions”.
9. The Respondent had filed reply dated 02.09.2024, submits that the application is devoid of merit and no
