Matter: State Bank of India v. Savita Gowda
Order date: 20 January 2022
Summary:
Corporate insolvency resolution process (CIRP) was initiated against Sharon Bio-Medicine Ltd. (Sharon Bio-Med) and a resolution plan was approved by the NCLT. In the meanwhile, State Bank of India (SBI) filed an insolvency application against Ms. Savita Gowda (Guarantor), the personal guarantor of Sharon Bio-Med and the erstwhile promotor of Sharon Bio-Med. As a resolution plan for Sharon Bio-Med was already approved by the NCLT, though still pending implementation, the Guarantor sought dismissal of the petition filed by SBI for initiating insolvency process against her. The question before the NCLT was whether the petition
filed for initiation of insolvency process of the Guarantor was maintainable in view of the fact that the resolution plan against Sharon Bio-Med was approved.
The NCLT held that the since CIRP of Sharon Bio-Med had commenced and the resolution plan was approved by the present Bench of the NCLT, so the jurisdiction to entertain the petition against the Guarantor is also vested in the present Bench. Once Sharon Bio-Med was admitted into CIRP and a resolution plan was approved, the NCLT Bench would have the territorial jurisdiction to hear any applications filed for insolvency of the personal guarantor. Accordingly, insolvency proceedings were initiated against the Guarantor.
