Note: The present appeal and the appeal filed by Rahul Arunprasad Patel challenged the impugned order dated 17.05.2024. Given the common factual premise, the court relied on the pleadings in Company Appeal No. 1826 of 2024 for adjudication.

Facts & Background:

• Amit Dineshchandra Patel, the personal guarantor of SBI Cap, was the Appellant.
• The State Bank of India (SBI), the party to COR Common Loan Agreement, was the Respondent No. 1, and Mr. Sunil Kumar Kabra, the Resolution Professional, was the Respondent No. 2.
• On 21.09.2015, Respondent No.1, Bank of Baroda and IDBI Bank appointed SBI Cap as their Security Trustee under a Security Trustee Agreement to hold and manage security including guarantees under the Guarantee Agreement.
• On 09.02.2016, Respondent No.1, Bank of Baroda, and IDBI Bank entered into a Common Loan Agreement with Shirpur Power Private Limited for financing under the COR Facility Agreement. The Appellants executed a Personal Guarantee Agreement with SBI Cap as the Security Trustee on the same date.
• On 29.11.2017, Respondent No.1 classified the principal borrower's account as a Non-Performing Asset (NPA) due to its failure to repay the loan. Subsequently, on 10.05.2018, Respondent No.1 recalled the outstanding loan amounts under the Common Loan Agreement (CORLA).
• On 02.06.2018, Respondent No.1, acting as the Lender’s Agent, invoked the Appellant’s personal guarantees and issued a demand certificate directing payment under the COR Facility Agreement within seven days.
• On 04.03.2020, Respondent No.1 initiated proceedings under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC), leading to the admission of the principal borrower into the Corporate Insolvency Resolution Process (CIRP).
• On 20.10.2020, Respondent No.1 invoked the Appellant’s personal guarantees and issued a demand notice under Rule 7(1) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019.
• On 29.04.2021, Respondent No.1 filed an application under Section 95 of the IBC 2016 before the National Company Law Tribunal, Ahmedabad, to initiate insolvency resolution proceedings against the Appellants, which were admitted on 17.05.2024.
• Hence, the present appeal.
  

Main Issue:

1. Was Respondent No.1 Bank entitled to invoke the personal guarantee?
2. Whether Mr Nitin Kumar Chauhan, the signatory, was authorised to file an application under Section 95 of the Insolvency & Bankruptcy Code, 2016? (Paragraph 6)