In the matter of Karur Vysya Bank vs. Vaibhav Singhal,

The present IA No. 1611 of 2023 has been filed by Mr. Roshan Lal Jain (from now on referred to as the ‘RP’), of Personal Guarantor Mrs. Vaibhav Singhal (from now on referred to as the ‘Respondent’/‘Personal Guarantor’) placing therewith the Report prepared by the RP under Section 99 of IBC, 2016.

2. To put the facts concisely, the underlying main Petition CP (IB)- 417/ND/2022 was filed by Karur Vysya Bank against the Personal Guarantor namely, Mr. Vaibhav Singhal under Section 95 of IBC 2016, to initiate the IR process. Vide order dated 03.08.2022, this Adjudicating Authority appointed Mr. Vishva Deep Sharma as the Resolution Professional of the Personal Guarantor and directed him to file its Report under Section 99 of IBC, 2016. However, since Mr. Vishva Deep Sharma failed to discharge his functions as RP, he was replaced by Mr. Roshan Lal Jain as the RP of the Respondent Vide order dated 20.02.2023 of this Adjudicating Authority with a direction to him to file the Report within 14 days.

3. In compliance with the order dated 20.02.2023 passed by this Adjudicating Authority, the present IA-1611/2023 has been filed by Mr. Roshan Lal Jain RP enclosing therewith the Report under Section 99 of IBC 2016 recommending admission of the Section 95 application IB-417/ND/2022 in respect of the Personal Guarantor.

IA. No. 1611/ND/2023 in (IB)-417/(ND)/2022

4. The relevant paragraph of the Report filed with IA 1611/ND/2023 containing the recommendation of the RP reads thus:

5. While making its recommendation of admission of Section 95 application against the Personal Guarantor, the RP has submitted the following in its Report filed under Section 99 of IBC, 2016:

IA. No. 1611/ND/2023 in (IB)-417/(ND)/2022

6. On issuance of the notice on the Report filed under Section 99 of IBC 2016, Ld. Counsel for the Personal Guarantor appeared on 28.03.2023 and was granted 2 weeks to file a reply. Despite Opportunity, the Respondent/ Personal Guarantor failed to file its reply. Even during the final hearing of the matter on 20.11.2023, Ms. Pratiti Rungta, Ld. Counsel for the Personal Guarantor submitted that she has nothing to say in opposition to the application/report filed by the RP and she does not wish to file any reply. In this backdrop, she requested this Adjudicating Authority to pass appropriate orders.

7. We heard the submissions of the RP and Personal Guarantor. We have also perused the Application filed under Section 95 of IBC, 2016, and the RP’s Report filed under Section 99 of IBC 2016.

IA. No. 1611/ND/2023 in (IB)-417/(ND)/2022

8. The Creditor has placed on record the Guarantee Deeds/Agreements executed and signed by the Respondent herein Mr. Vaibhav Singhal on 30.04.2015 and 08.01.2016, thereby guaranteeing the loans granted to M/s Savemax Wholesale Club Private Limited and M/s Bishan Saroop Ram Kishan Private Limited respectively.

9. It is seen from the record that the loan account of the Corporate Debtors M/s. Savemax Wholesale Club Private Limited and M/s. Bishan Saroop Ram Kishan Private Limited became a Non-Performing Asset (NPA) on 30.05.2018 and 09.03.2018 respectively.

10. Further, it is seen from the record that the Creditor / Karur Vyasa Bank invoked the aforesaid Guarantees vide its Notice dated 07.11.2019 issued under the provisions of Section 13(2) of the SARFAESI Act, 2002 in respect of M/s. Savemax Wholesale Club Private Limited and Notice dated 13.04.2018 in respect of M/s. Bishan Saroop Ram Kishan Private Limited Wholesale Club Private Limited.

11. It is also seen from the record that the Creditor / Karur Vyasa Bank had sent Demand Notices in Form B under Rule 7(1) of Insolvency & Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process of Personal Guarantors to Corporate Debtors) Rules, 2019 via Speed Post dated 29.03.2022 to the Personal Guarantor. It has been added that the Demand Notices were served by Speed Post on 31.03.2022 and 02.04.2022 and the tracking reports are at Page 14 and 41 of the Application respectively.

12. The Application filed on 28.05.2022 is well within 03 years from the date of invocation of guarantees.

IA. No. 1611/ND/2023 in (IB)-417/(ND)/2022

13. Since despite opportunities, the Respondent failed to file its reply to the RP’s report, and during the hearing, its Counsel submitted that it has nothing to say in the matter, we proceed ahead in the matter.

14. Given the above, the Creditor has been able to establish its debt and default beyond doubt relating to the Guarantees given by the Respondent/ Personal Guarantor. Hence, we have no reason to disagree with the recommendation made by the RP for admitting the present Application. The Application is accordingly, admitted.

15. As a sequel of admission of the present application, the Moratorium under Section 101 of IBC, 2016 shall commence in relation to all the debts of the Respondent/Personal Guarantor. During the moratorium period – (a) Any pending legal action or proceedings in respect of any debt qua the Respondent shall be deemed to have been stayed;

(b) the creditors shall not initiate any legal action or legal proceedings in respect of any debt qua the Respondent; and (c) the Respondent shall not transfer, alienate, encumber, or dispose of any of the assets or his legal right or beneficiary interest therein.

The moratorium shall cease to have effect at the end of 180 days.

16. A public notice shall be issued by the RP, within seven days of passing of this order, inviting claims from all creditors within 21 days of such notice. The notice shall include details of the present order, particulars of the RP with whom the claims have to be registered, and the last date for the submission of the claims. The said notice shall be –

IA. No. 1611/ND/2023 in (IB)-417/(ND)/2022 (a) published in English and one Vernacular Language newspaper which is in circulation in the State where the debtor resides;

(b) affixed in the premises of this Adjudicating Authority; and (c) placed on the website of the Adjudicating Authority.

17. The RP shall discharge all such duties as are incumbent upon him in terms of the provisions of Sections 104, 105, 106, 107, 108, 112, and 113 of IBC, 2016, with due deference to the procedure enshrined in Regulations 5, 7, 8, 9, 11, 12, 13, 14, 15 and 17 of IBBI (Insolvency Resolution Process for Personal Guarantor to Corporate Debtors) Regulations, 2019 and also in terms of the other extent provisions of the aforementioned code/ regulations and/or any other provisions of law applicable to him, in the discharge of his duties as RP.

18. A copy of this order along with a copy of the application as well as the Report of the Resolution Professional shall be provided to the Creditor (Applicant), Respondent/Personal Guarantor, and IBBI, by the Registry/Court Officer within 07 days from today.

19. IA 1611/ND/2023 is disposed of accordingly. To come up for consideration of Status Report to be filed by RP, within 08 weeks.

Sd/- Sd/- (L. N. GUPTA) (ASHOK KUMAR BHARDWAJ) MEMBER (T) MEMBER (J)

IA. No. 1611/ND/2023 in (IB)-417/(ND)/2022